KINGFISHER AIRLINE

It was a India based airline group founded in 2003, headquarter

Mumbai,Mharastera. Its parent company was United Breweries Holdings
Limited, headquarter is in Bangalore city, it had 50% stack in kingfisher
red and its low-cost career. Mr.Sanjay Aggarwal was the CEO of this group
and Mr.Vijay Mallya

was the CMD of Kingfisher Airline. Its first hub was Bangalore
International airport and secondary hubs are Chhatrapati Sivaji
international airport,Pune international airport.It was basically focus on
Chenni international airport and Pune international airport.Companies
tagline was FLY THE GOOD TIMES.The number of employees in Kingfisher
was 5,696. The airline started commercial operation on 9 may2005with a
fleet of four new Airbus A320-200s operating a flight from Mumbai to
Delhi. It started its international operations on 3 September 2008 by
connecting Bangalore with London . In May 2009, Kingfisher Airlines
carried more than 1 million passengers; giving it the highest market share
among airlines in India.Kingfisher also won the Skytrax award for India's
best airline of the year 2011. Kingfisher Airlines is also the sponsor of F1
racing outfit, Force India, which Vijay Mallya also owns.

What went wrong so Kingfisher Fail to save the existence in

market and closed?
 The only marketing failure that can be find out in the entire gamut of
things was the takeover of Air Deccan and formation of Kingfisher
Red and thereby diluting the brand value, KFA stood for . Dr Mallya
wanted to change the thought or wanted us to believe that airlines
were no more a means of going from place A to B.But the general
middle class and also upper class in India consider travelling as a
means of transport .There is a few selected class that wouldlike to
pay extra for getting luxury while travelling.
 Competition: Aviation Industry is presently in the state of more
supply and less Demand .Indigo,Spicejet, GO Air offered comfortable
flights at the same time as Kingfisher did. They were almost as old as
Kingfisher Airlines but what new about them was that they had
restructured themselves with time but had always stayed on course
with it comes down to business model. There is still a big class of
people who prefer to travel by Indian Railways and therefore the
strategy of Kingfisher was more suited for the Business class
customers .With the Launch of Kingfisher Red their entry into the
Low Cost Carrier (LCC) segment did not prove to be a success .
 In-flight interruption: Unlike road or rail transport, where there’s
much of scenery around to keep you busy, flights are usually boring.
Much of the travel through flights between metros is covered in less
than two hours. In-flight entertainment or a movie is started only
after the seat-belt signs are off. And then there’s interruption of
 meals being served. Most passengers on domestic flights are not
looking forward to in-flight entertainment. Offering in-flight
entertainment to keep one busy for two or more hours was/is a
smart move, but it adds up to infrastructural costs. A tie-up with
Dish TV for live entertainment meant installation of more than 50
customized dishes on aircrafts. Offering free headphones was also an
added cost for the company.
 Acquisition of Air Deccan: Kingfisher Airlines decided to introduce
Kingfisher Red and then it automatically entered into a price war
against all other carriers especially domestically. Airline business has
extremely long gestation periods. For Kingfisher, Air Deccan was a
totally new business so it should have considered that Kingfisher Red
will take some years to completely reap benefits of being a low cost
carrier but Kingfisher believed that Air Deccan had been in the
market much before Kingfisher Airlines so it should bring Kingfisher
Airline’s financial statements into green very soon. The business
fliers which were earlier loyal to Kingfisher Airlines used all their
frequent flier miles, bought free tickets, gave the same to their
families and did not return back. As soon as Kingfisher realised that
they had committed a mistake by changing model of Air Deccan, it in
a haphazard way increased prices of Kingfisher Red and brought the
same on par with other airlines. At this point of time Kingfisher Red
had become a lost opportunity and even the management was
confused if it would call it a normal carrier or a low cost one. Finally
in February 2012 the brand Kingfisher Red was officially declared
non-functional, marked one of the biggest examples of failed
consolidation and became a land mark failure in terms of mergers
and acquisitions.
  Fair fares: While KFA truly offered a premium and luxury service it
took pride in calling itself a budget airlines. It refrained itself from
calling itself an LCC (Low-cost-carrier) as though its fares were higher
than the LCCs, it kept its fares lower than Jet Airways, Indian Airlines
(now Air India) and the erstwhile Sahara.
 High Fuel Costs: Amidst this all, Dr Mallya forgot that he was
operating in a business where fuel costs are variable and taxes are
discretionary. Add to all this the costs of high-blitz advertising,
including the deal with Ms Padukone, putting up exclusive lounges at
airports, gourmet cuisine, tele-booking centres in Kingfisher First,
aircraft costs, acquisition costs of Air Deccan… and what not. It was a
clear case coming true of the Indian proverb: Aamdani atthani,
kharcha Rupaiya.

Market Share of Aviation Companies (FY 2012)

Market Share of
GoAir; 7.00% Aviation
Kingfisher; 7.00% Companies;
Indigo; 5.00% 16.00%

Air India; 19.00%

Jet Airways; 25.00%

Spicejet; 21.00%

Could the organization have been turned around?