Fresh from completing its merger with Air Deccan, India's Kingfisher Airlines is embarking on a major international expansion which will see it launch up to 15 overseas routes over the next three months as it tries to offset its highly unprofitable domestic operation.
Kingfisher has taken delivery of its first batch of widebodies and plans to begin serving its first international destination, London Heathrow, at the end of August or beginning of September. Chairman Vijay Mallya unveiled Kingfisher's first Airbus A330-200 and new long-haul in-flight product at July's Farnborough air show.
Kingfisher will take by October five A330s and five A340-500s, both in two-class configuration with 30 and 36 "Kingfisher First" seats respectively, plus 187 and 201 in economy. The A330s will be used to serve Heathrow from Bangalore and Mumbai while the A340s will be used to connect Bangalore with San Francisco.
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Kingfisher First features lie-flat massager beds, custom built by B/E Aerospace, and a 17in Thales IFE screen. What Mallya is most proud of is the staffed bar, surrounded by bar stools and two sofas, which he says is designed "to put back style into travel that over the years has disappeared". He points out some Boeing 747s were initially equipped with bars upstairs but "we don't see them anymore. They've all been replaced by seats".
Mallya adds: "Kingfisher First will sell for prices slightly higher than business class prices but for all practicable purposes offer a full first class experience. The only thing we don't have is a partition and individual cabins but I think those are necessary in today's economic environment.
"As a product I think we have an unbeatable super business or first classI believe there will be people that will pay to fly in style. That is what Kingfisher First delivers."
In addition to launching long-haul operations, Kingfisher is also planning to redeploy several of its 51 Airbus A320s, all of which are in two-class configuration, from domestic to short-haul international flights. Over the next three months flights will be launched to the UAE, Qatar, Kuwait, Thailand, Malaysia, Singapore, Sri Lanka, Bangladesh, Pakistan and the Maldives.
Mallya wants to move as many A320s to international routes "as quickly as we can because the yields are better and the tax is lower". India's domestic market is currently highly unprofitable and suffering from overcapacity. Kingfisher has already slashed capacity domestically and has dramatically slowed down deliveries of A320s and ATR 72s. The carrier's fleet will surpass 100 aircraft by year-end with well over 100 more aircraft still on order.
Mallya acknowledges it is currently impossible to be profitable in the Indian market but he does not want to let high fuel prices get in the way of his long-planned international expansion. "We have huge cash flows," he says. "If it means seeing Kingfisher through turbulent times we will."
Kingfisher is able to begin international services on 26 August, which is the day Deccan turns five years old. In India carriers must operate for five years in the domestic market before starting international services. Kingfisher parent UB Group began acquiring Deccan last year and in December unveiled plans for a full merger, which was completed in July. Without the merger Kingfisher would have had to wait until 2010 to launch international services.
Mallya had been looking at taking over a second Indian low-cost carrier but in July he was outbid for a stake in SpiceJet by US private equity firm WL Ross & Company. "I made an offer that makes sense to Kingfisher Airlines," Mallya says. "They [had] aspirations I cannot meet."
Mallya says more consolidation is needed in India but adds: "Kingfisher is not as vulnerable as the other Indian airlines."
To see inside Kingfisher's new A330, see our video with Mallya: flightglobal.com/kingfisher
Source: Airline Business
