Kingfisher extends lockout for another week

Last Updated: Fri, Oct 12, 2012 14:50 hrs

New Delhi/Mumbai, Oct 12 (IANS) Debt-ridden Kingfisher Airlines hurtled towards a dead-end Friday, grounding its fleet for another week days after the aviation regulator sent a show cause notice to the management.

The airline said that it was extending the lockout till Oct 20. The lockout was declared Oct 1 after negotiations with striking employees failed amid reports that the airline was unable to pay full salaries to employees since its lenders had refused fresh funding.

"The partial lockout declared as a result of employee related issues is being extended until Oct 20. At this time, the airline is hopeful of resuming operations starting October 21," Prakash Mirpuri, vice president, corporate communications, Kingfisher Airlines said in a statement.

The situation at the airline has not improved even after the regulator hauled it up and cancelled all 50 flights Oct 1, as employees went on strike demanding payment by Oct 5 of their salaries pending since March.

Key personnel like aircraft maintenance engineers, whose airworthiness clearance is mandatory for any flight to take off, also struck work.

The employees claim that non-payment of salaries has affected their morale and built up stress levels that can also affect operational safety.

Meanwhile, the Directorate General of Civil Aviation (DGCA), which had issued the notice "as the airline has failed to establish a safe, efficient and reliable service", said it was yet to receive any communication from the company .

As per Section 15(2)(b) of Schedule XI of the Aircraft Rules 1937, DGCA may cancel or suspend the permit of an airline if it is satisfied that the permit-holder has failed to establish a safe, efficient and reliable service.

The airline had the lowest market share in August, which stood at 3.2 percent. The airline has a total debt of Rs.7,000 crore with a consortium of banks.

According to a report by the Centre for Asia Pacific Aviation (CAPA), Kingfisher Airlines may have to shut down operations if $600 million is not infused in it in the next two months.

The company reported a net loss of Rs.650.78 crore ($117 million) for the quarter ended June 30.

Currently, the airline has only 10 operational aircraft from an earlier strength of around 66 planes a year ago. It was also the country's second largest airlines by passenger traffic.

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