Low-cost carrier Kingfisher Red will shut down in four months with the airline group chief Vijay Mallya on Wednesday saying several measures have been initiated to face financial problems caused by high interest burden and burgeoning fuel costs.
Low-cost carrier Simplify Deccan will be rebranded Kingfisher Red, a separate brand identity from Vijay Mallya-promoted full-service carrier Kingfisher Airlines.
IndiGo gained a market share of 14.7 per cent, closely followed by Kingfisher Red at 13.3 per cent whereas Kingfisher slipped two notches to the fifth position at 11.6 per cent. Kingfisher stood at No.3 in October, followed by Kingfisher Red and IndiGo at fourth and fifth, respectively.
Plans to remove onboard bar to create space.
The decision to close down Kingfisher Red was announced by airline group chief Vijay Mallya yesterday who said this was being done 'because we don't intend to compete in the low-cost segment'.
To add aircraft, more services this year, even as full-service airlines hold their expansion plans.
Low cost carriers have 55 per cent of the market, up from 45 per cent in Q1 last year, and 30 per cent two years back. Does it mean India really is an LCC market? The performance of the airlines also seem to suggest that. While budget carrier Spicejet announced a small profit for Q1, all the big boys in the industry seem to be in trouble.
Kingfisher Red topped the list of loss-makers with Rs 79,8.34 crore (Rs 7.98 billion).
Kingfisher Airlines has begin flights between Mumbai and Nasik. The airline's offers an all inclusive fares starting at Rs 885 for travel from Nasik to Mumbai and Rs 883 for travel from Mumbai to Nasik.
Confirming the airline industry's estimates of a slowdown in the aviation sector, domestic passenger traffic for the calendar year 2008 showed a decline of 5 per cent compared to the previous year. Also, the Kingfisher-Kingfisher Red combine ousted Jet-JetLite as the largest Indian carrier combine in the month of December 2008.
Air Deccan, which was renamed Simplifly Deccan after the merger with Kingfisher last year, is now called Kingfisher Red. According to the data released by the civil aviation ministry on Thursday, IndiGo's market share is 10.3 per cent, while that of Air Deccan trailed behind at 10.2 per cent.
With oil reaching record highs and competition intensifying, Captain Gopinath's chances of keeping his carrier afloat would have been more than slim. Employee's jobs and salaries would have been at stake if he had not sold to Vijay Mallya, says Anjuli Bhargava.
The airline would offer Re 1 ticket to a few passengers through a lucky draw as part of its promotional campaign.
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