Dubai Air Show

Bold Kingfisher splashes more cash on twinjets

 - December 7, 2006, 9:05 AM

Airbus’ solid sales showing at this year’s show continued yesterday with Kingfisher Airlines’ announcement that it would take another 30 Airbus A320-family jets starting in 2008. Meanwhile, almost simultaneously back in Toulouse, the company announced a deal with TAP Portugal for 10 A350s and seven A330-200s, scheduled for first deliveries in 2013 and 2007, respectively. Today, Airbus expects to add to its total with at least one more order and likely two, according to a source close to the company.

Led by one of India’s most charismatic figures, UB Group chairman Vijay Mallya, Kingfisher has placed seven A320s into service in the course of six months, allowing the company to take 6 percent of the country’s air transport market. It plans to add three more A319s and another A320 by January.

On Sunday Kingfisher confirmed an order for 20 ATR 72-500 turboprops, scheduled for delivery over a three-year period starting next March. By the time it gets all its medium-range and regional aircraft, Kingfisher expects to have proven its mettle to the Indian government, which requires five years of successful and safe operation before it will issue an airline approval to fly internationally. In preparation for that eventuality, Kingfisher earlier this year placed an order for five A380s, scheduled for delivery in 2010, and five A350s, due to arrive in 2012.

In a seeming departure from its discount-fare character, Kingfisher plans to fit 15 of the 30 new A320s in a two-class configuration. Mallya said the airline will offer first-class seating starting in February 2006. He also confirmed he planned to take the company public “some time in 2006” to help pay for his expansion plans.

Mallya’s aggressiveness has raised some questions about his chances of long-term success given India’s still creaking air transport infrastructure, serious pilot shortages and the demands placed on A320 delivery slots from all over the world.  

“We constantly have this argument about delivery slots,” said Mallya. “We have our needs covered through 2007. Then these deliveries start in 2008 and see us through 2011.”

Mallya also expressed confidence that the new Indian administration possesses the will and ability to follow through with its plans to build a modern air transport system by 2010. “The [airport] bottlenecks are exaggerated…and the shortage of pilots is not an impossible situation.”

Also on hand for the announcement, India’s minister for civil aviation, Prafel Patel, did his best to dispel any residual skepticism. “This is not just about buying planes and in the case of Airbus selling them,” said Patel. “For a long, long time we have neglected the [air transport] infrastructure…We will spend $8- to $10 billion in the next three to four years. I assure you we will have all our plans accomplished by 2010.”