Kingfisher to submit recovery plan

Financially troubled Kingfisher Airlines Ltd is due to submit a recovery plan to the aviation regulator by end-March so it can continue flying, according to a Livemint.com report.


IATA has suspended Kingfisher


Financially troubled Kingfisher Airlines Ltd is due to submit a recovery plan to the aviation regulator by end-March so it can continue flying, according to a Livemint.com report.

This plan reportedly entails a further cutting of international operations, pulling out of all loss-making routes, renegotiating high-cost aircraft lease rentals, tapping foreign loans for working capital and getting back its US$40 million deposit from the International Air Transport Association (IATA).

IATA has suspended Kingfisher for the second time in two months from the IATA clearing house (ICH) system for defaulting on payments. “Mallya had met IATA director general and chief executive officer Tony Tyler to discuss the issues. If IATA agrees, it will help the airline give salaries in a phased manner,” the reports quoted an unnamed executive at the carrier as saying. Kingfisher plans to disburse salaries in a phased manner to its employees, who have not been paid since December.

The regulator has issued a showcause notice to the airline asking
why it should be allowed to continue operations. DGCA can initiate tough measures against the airline if it fails to convince the regulator about its potential for recovery, since the cash crunch can affect flight safety.