Hello, guys today we will discuss about Kingfisher airlines and reason why Kingfisher airlines failed? The Chairman of the airline is Mr.vijay Mallya a very rich businessman of India and Kingfisher had a huge brand equity in airlines. Kingfisher Airlines was India’s only five–star airline and the only one to offer premium first class service on domestic routes. the first and only airline in India to offer in-flight entertainment, Kingfisher offers live TV on many domestic routes in India.Vijay Mallya provided a good experience, luxury, and lifestyle to their passengers but still, the airlines failed.So today we will discuss why airlines failed.?
Reasons For The Downfall Of Kingfisher Airlines-
- Mismanagement turned into a scam or lack of management- In the airline of Vijay Mallya, there was no any (MD) managing director or any (CEO)chief executive officer from the beginning that’s why airline became mismanagement.Because Vijay Mallya was busy in their parties and to live a luxurious life so, nobody was there to handle the airline.but after so long Mr. Sanjay Aggarwal had been came as a CEO but at that time airline was not in the condition for survival.
- Frequent Changes On Focus and no sustainable business model-Firstly, Kingfisher was provided an economy class service to their passengers, but later on, they shifted focus to luxury business class on their aircraft, on the other hand, other air travelers appreciated the hospitality, aircraft condition and it’s quality but Kingfisher focus was on luxury premium first class service. but After acquiring the Air Deccan they suddenly shifted focus on low-cost air traveling, frequent changes in the hospitality and aircraft ambience made travelers lose their interest in the brand, they didn’t focus on highly profitable routes in domestic area, acquired Air Deccan air crafts(Kingfisher Lite) use to run at the same time as Kingfisher , there was no proper management between Kingfisher Lite & Kingfisher Airlines. kingfisher lite becomes the competitor of Kingfisher airlines. Mr. Gopinath who is the ex-founder of Air Deccan expressed his view that Kingfisher airlines treated Air Deccan as a stepchild, they never managed the operations for profitable use.
- Acquisition For Expansion- Vijay Mallya knews that Kingfisher airlines has suffered heavy losses but still he acquired the Deccan airlines which were already suffered from loss, so the result to acquired the Deccan was that both airlines have competed with each other. they never tried to control these two companies to improve their profits with its merger.
- Economic Slowdown- Both the airlines (kingfisher & Deccan) were suffered from heavy loss, So Kingfisher started it’s international route from Bangalore to London in 2008. kingfisher already suffered from loss and the idea of international routes were all in vain because for international routes huge investment was required and there were a high competition and the margins of profit was very low. And in the same year recession affected the whole world, which is indirectly affected the air travel occupancy in international routes, because of the recession, airplane fuel prices raised, airport charges for landing are very costly in international airports around the world, all these external factors caused the Kingfisher airlines to downfall.