VintageKrug - 23/02/2010 08:18 GMT
Some exciting news for oneworld, which has been one of the slower alliances in growth terms.
Kingfisher to join shortly:
Tuesday, 23 February 2010: India’s leading domestic carrier and only five-star airline, Kingfisher Airlines, is lining up to join oneworld ® after signing a memorandum of understanding as its first step towards full membership of the world’s leading quality airline alliance, subject to Indian regulatory approval.
The agreement was concluded at a meeting between Kingfisher Airlines’ Chairman Vijay Mallya and Chief Executives from oneworld’s 11 existing member airlines, which include some of the best and biggest names in the industry.
Kingfisher Airlines today applied to India’s Ministry of Civil Aviation for authority to proceed with its membership of oneworld.
A target date for Kingfisher Airlines to join the alliance will be confirmed once this approval is gained. The process to bring any airline on board normally takes around 18 months to complete, so Kingfisher Airlines could be expected to start flying as part of oneworld during 2011.
Home@FL350 - 23/02/2010 08:55 GMT
Good news indeed. I have enjoyed flying Kingfisher domestically for a number of years now (I have found their Y class equal to or better than many European carriers' short-haul J class) and will now enjoy doing so on some of my frequent trips to India from LHR (whilst still earning BA or AA credit!).
VintageKrug - 23/02/2010 09:45 GMT
I get the feeling that Kingfisher started out with a very similar ethos to www.virginamerica.com
My understanding was, though, that many of the domestic services had recently been curtailed and changed to single class operation..?
wanula1 - 23/02/2010 10:17 GMT
Good news for OneWorld especially as Air India are joining Star.
I was wondering when and who but to be honest had expected Jet Airways to be the option as they are already linked to QF (code shares to India) as well as AA and CX.
Still having additional access to the 58 additional Indian cities and being able to earn points will be a plus point.
ScottWilson - 23/02/2010 10:28 GMT
Excellent news indeed.
One thing I had noticed is how the liberalisation of the Indian aviation sector had seen competition on quality arise (given the standards Air India is sadly known by it isn't surprising). It is clear that the likes of Kingfisher and Jet both aim, with hard and soft product, to win people over for being good quality airlines.
The contrast with US carriers is telling, perhaps reflecting India's core airline market being middle class aspirationally driven people who appreciate quality, whereas in the US growth has been driven by LCCs making point to point travel as cheap as possible.
VintageKrug - 23/02/2010 10:36 GMT
I think it's just different stages of market development; you only have to take a look at some of the historical photographs of the interior lounges on Continental's 747 domestic services to see what luxuries were offered when air travel first "took off" in the US:
www.postcardpost.com/cw45.jpg
I only flew on Braniff twice (never on their Concorde service), but it was a memorably excellent carrier in its early days:
www.braniffpages.com/747lounge2.jpg
jet airways is confused. They think they can survive on the emirates model. did succeed for a while but the recession got them into trouble.Now they are just in the leasing buisness.THey have leased most of the 777 to who ever they can find.Now they can only join sky team
Home@FL350 - 24/02/2010 09:04 GMT
Certainly not on the routes I ply, VK (normally BOM to DEL or BOM to MAA). Very much a 2 class service (noting that the pointy end is First, not Business...).
The service starts when you get out of the taxi at the airport, with a porter who runs up to you to ask if you are travelling Kingfisher. If so (regardless if you are flying economy or premium), the porter takes your bags to check-in and then doesn't even fish for a tip! Once on board (in Economy), water (in a bottle) is serrved prior to take-off, along with a hard candy. I don't even get this type of service whilst flying Club Europe (my flight ARN - LHR 2 weeks ago, for example, didn't see any drinks until 30 minutes after wheels-up.).
Kingfisher's economy pricing (for domestic flights) tends to be some 15% higher than the no-frills competitors (Spicejet, Indigo, Jetlite, GoAir) however the flights seem to always have a very good load factor. In addition to the in-flight entertainment (headphones free for Y pax) the airline's owner, Vijay Mallya (a real Richard Branson type) makes an announcement and encourages anyone with suggestions/comments to email him "personally." The last time I remember any airline chief doing anything similar is when the black book used to be passed around the Upper Class of Virgin (soliciting feedback). A colleague of mine actually had Richard Branson call him personally to follow up on one of his comments.
Again, I think Kingfisher will be a much-welcomed addition to OneWorld.
So poor old Kingfisher has had the drawbridge raised - pretty much at the last minute, since they were due to join oneworld within a week of the announcement of that being postponed. I am not sure I understand the reasoning for this - after all, Mexicana has gone spectacularly bust and stopped operating, Malev ditto, American Airlines has gone into Chapter 11... At least Kingfisher isn't in bankruptcy and is still flying (albeit somewhat reduced over the last months).
Strangest of all, the Economic Times of India estimated that joining oneworld would allow Kingfisher to boost earnings by 5 percent so postponing entry would seem to cut off some additional revenue. So why the postponement? One cannot help wondering if this means that Kingfisher and oneworld have recognised that bankruptcy is virtually inevitable and oneworld wants to avoid the embarrassment and publicity of a fourth member going to the bankruptcy courts.
Gin&Tonic - 06/02/2012 08:58 GMT
Watch out for Ethiad making a move on them!
Thanks for your post Ian_From_HKG. It’s quite simple. Kingfisher is no longer a member of the IATA Clearing House. One of the selling points of any alliance is that members accept each others tickets.”
http://www.thehindubusinessline.com/industry-and-economy/logistics/article2854304.ece
Alex McWhirter
Thanks, Alex - but if that is the case, why an indefinite postponement and the statements by Kingfisher referencing their recapitalisation efforts? Surely recapitalisation wouldn't be a prerequisite to rejoining the clearing house?
We were once given a talk at a BSCC event in Geneva from the CEO (I think) of IATA.
Rather like a bank, if BA say owe 10m to Quantas, and Quantas owe 11m to BA, then BA will receive the difference of 1m. If BA in turn owe 1m to say Swiss, then BA will get nothing as that 1m will be paid to Swiss and so on.
It's a bit simplistically put but that is why an airlines market capitalization is important since if Kingfisher were running a negative capitalisation, in many countries it would be regarded as being bankrupt.
IATA have to know an airline is financially capable of meetings its financial obligations and this is why it's balance sheet is such an important factor in approving and maintaining membership.
Saffjoyfox3 - 07/02/2012 09:29 GMT
I agree, Ian. I think it looks very difficult for Kingfisher to survive, despite its recapitalisation efforts. It will be likely to be elThere is a lot of competition in the Indian aviation market. In addition to the full service carriers like Jet and Air India/Indian Airlines, there are lots of LCCs such as SpiceJet, IndiGo and Jet Lite. Kingfisher was once excellent, but its very wobbly now.
OW needs a reliable Indian member given India's huge internal routes and the massive growth of business.
RichHI1 - 07/02/2012 09:37 GMT
WHilst not central to the topic, I think there is a need to look at the IATA strcutures which were developed in a time of National FLag Carriers subsidized by Governments (and as we all know that does not happen any more....). Many airlines have very different financials models to the original flag carrriers with mostly leased assets and limited access to addtional capital, focussing their attention on revenue.
LuganoPirate, thank you for the explanation (although I already understood how clearing houses work), but (with respect) the key issue for such arrangements from an operational perspective is solvency (ability to pay debts as and when they fall due, which is a cashflow issue) rather than capital - although, of course, there can be a knock-on effect since lenders may not be willing to provide funds to keep a company solvent unless it has enough capital (as we have all seen in recent years). This issue of solvency is distinct from bankruptcy (owing more than you own) and for companies, the issue under so-called bankruptcy laws is in fact commonly one of solvency rather than bankruptcy (you can be insolvent without being bankrupt, just as you can be bankrupt but solvent). Having said that, I don't know whether IATA specifically require members to pass a net-worth test (where capital would be relevant). They may even require posting of collateral/margin, for all I know. In any event, though, Kingfisher have said they have paid all their dues to IATA and that the non-payment was only a technical glitch (http://articles.economictimes.indiatimes.com/2012-02-03/news/31021228_1_kingfisher-airlines-kingfisher-flight-kingfisher-spokesperson), so one wonders if that is really the reason for the oneworld suspension
Saffjoyfox - I hope you are wrong about Kingfisher's survival prospects. I like their service, and was looking forward to my future Indian trips being on them while still being able to clock up oneworld miles and status. Fingers crossed they sort it all out soon (although at the moment I am not scheduled to go back to India until Q3)
Saffjoyfox3 - 07/02/2012 10:55 GMT
Ian, I also hope that Kingfisher survives as I always enjoyed my flights within India on them. Their service was always excellent - and it was always amusing when the cabin crew offered to clean the passengers' spectacles. Since their woes, I have moved to Jet for my internal flights while in India as the Kingfisher flight schedules were not reliable. I have not flown with them on their India-LHR routes, but know people who have and who thoroughly enjoyed the experience.
I have had a few domestic trips on Kingfisher, which were fine but nothing special.
I have also only done one international trip, but that was quite something. I forewent my endless search for oneworld miles (to maintain my status) and opted for the Kingfisher flight from Mumbai to HK instead of CX. I haven't enjoyed a flight so much for years. Apart from the fact that despite my best efforts I wasn't able to get just one of the massage zones on the seat working (I could only get all five at once), which was the only problem during the entire flight, it was a delight.
Instead of the usual dynamic where all the business class passengers don't want to talk to each other, or even acknowledge each other's existence (I normally fall squarely into this camp, I must admit), as soon as the seatbelt sign went off everyone bundled into the bar and started chatting. Although it was an overnight flight, I spent the entire journey in the bar chatting to various passengers including a delightful Dutch family who were based in India, as well as to the ever-helpful barman. The only disruption was due to occasional turbulence, when I left my barstool and took up residence on one of the sofas (because they had seatbelts). The only time I spent in my own seat (apart from take-off and landing) was for the meal, which I think would be the only drawback if you didn't like Indian food.
Fortunately I love spicy food so thought it was wonderful. I was very much looking forward to reliving that experience, but will have to wait for oneworld membership to get back on track!
LondonCity - 15/02/2012 16:53 GMT
http://articles.economictimes.indiatimes.com/2012-02-14/news/31059164_1_kingfisher-pilots-kingfisher-airlines-jet-airways
According to The Economic Times dated February 14, Kingfisher has not paid its staff since last December. Surely this must be affecting staff moral which in turn will impact on service standards ?
The article also notes than Jet Airways staff haven't been paid for January although payment may come through today.
