Kingfisher Airlines is due to become the first Indian carrier to join one of the global alliances after oneworld announced this week that the carrier will be formally integrated into the grouping from February 10, 2012. The positive news was released as reports in Indian media claimed that the independent Indian carrier had just grounded around 15 of its aircraft due to financial issues.
Over the past few months Kingfisher has been forced to restructure its operations and cut its network, in the process slipping from being the second to third largest operator in the country by seat capacity. Like many airlines in the business it has been hit hard by economic instability and fuel price volatility, but its flamboyant founder, Vijay Mallya, the liquor tycoon, has said the company has no major liquidity concerns, although additional investment is being sought.
“Kingfisher Airlines will expand oneworld’s network substantially in a key region of growing travel demand, with a carrier that matches our demanding requirements, while enabling Kingfisher Airlines to offer its customers a truly global network on quality partners,” said Bruce Ashby, Chief Executive Officer, oneworld. “We are looking forward to welcoming them to the oneworld alliance in February.”
Kingfisher currently serves a network of 54 locations in nine countries and will bring an additional 40 destinations to the alliance’s network, all of them in its India home. This is a key growth for oneworld as India is the world’s second most populous market and forecasted to be the world’s second biggest economy within two decades. Its middle class population is expected to grow tenfold by 2025 – to nearly 600 million, according to analysts.
Currently seven of oneworld’s established airlines – American Airlines, British Airways, Cathay Pacific, Finnair, Japan Airlines, Qantas and Royal Jordanian - serve five Indian gateways, in Delhi, Mumbai, Bangalore, Chennai and Hyderabad. The Indian carrier will be the first carrier from the subcontinent to join any of the global airline groups - Air India had been due to join the rival Star Alliance this year but its financial predicament and concerns over its business strategy meant its proposed membership was cancelled.
For Kingfisher, joining oneworld will strengthen its competitive offering and its financial position. It received the green light to join the alliance this week after successfully completing a thorough review of its readiness with the oneworld central team. It has been helped through the entry process by sponsor British Airways, leading to rumours that the British carrier’s parent International Consolidated Airlines Group (IAG) could be interested in acquiring control of the carrier.
“Becoming part of oneworld will be one of the most significant steps in Kingfisher Airlines’ history. It will enable us to offer our customers a truly global network served by partners who include some of the best known and most admired airlines in the world,” said Vijay Mallya, Chairman, Kingfisher Airlines. “It will also strengthen us financially, through revenues from passengers transferring to our network from our oneworld partners and the cost reduction opportunities the alliance offers.”
Kingfisher will be the first of three airlines to join oneworld in 2012, its biggest membership expansion drive for five years. German carrier airberlin is set to follow during the first half of the year, while Malaysia Airlines will join later in the year. Its entry will boost the oneworld network to nearly 800 destinations in almost 150 countries, served by a total of almost 8,500 departures a day operated by a combined fleet of more than 2,250 aircraft, carrying 305 million passengers a year, with annual
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