Kingfisher Airlines will not be able to fly for the time being. The Directorate General of Civil Aviation (DGCA) has suspended its licence as the airline failed to satisfy the directorate that it had a “safe, efficient and reliable service”.

The airline will have to stop selling tickets immediately.

Civil Aviation Minister Ajit Singh said that the licence had to be suspended due to safety concerns. The airlines can always come back after it meets the requirements, he said. He said that the DGCA cannot compromise on passenger safety.

Kingfisher is also likely to lose its slots around the country. “How long can we wait for them to come back? Now that the order has been issued, slots will automatically go to whoever wants them. Kingfisher can seek them when it comes back but only after clearing previous dues,” a person-in-the-know said.

On October 1, the airline suspended all operations after its engineers refused to certify the aircraft for schedule flights, a prerequisite for any aircraft to take to the skies. The engineers, like other employees earlier, were protesting non-payment of salaries for the last seven months.

DGCA’s decision today to suspend the licence came barely 24 hours after the expiry of the deadline set by the regulator for the airline to reply to its show-cause notice on why its licence should not be suspended or cancelled.

The airline replied to the show-cause notice, but instead of tackling specific issues relating to payment of salaries and when it expected to restart operations, and sought more time from the regulator. In a message to staff members, a senior Kingfisher officer said: “A suspension is temporary and we can have it reversed once we submit a concrete plan to the DGCA. So, let us all hope for some good news with the meeting next week.”

Terming the suspension on “expected lines”, Chief Executive Officer, Centre for Asia Pacific Aviation, Kapil Kaul, said that the suspension will allow the airline to rethink about a complete revival or assess damages due to possible closure rather than restarting operations with five aircraft.

Terming the suspension of Kingfisher licence as unfortunate but not unexpected, Amber Dubey Partner and Head, Aviation, KPMG, felt that the suspension may not have any further impact on airfares as this has already been factored in by other airlines during the summer season when Kingfisher reduced its fleet.

Many are seeing the suspension of Kingfisher’s licence as the end of the road for the airline. “It will be difficult for an airline to rebound once it shuts down. But if the Diaego deal works out then one cannot say anything. However, at the moment it seems a bit unlikely that Kingfisher will come back,” said Kaul.

Debt-strapped Kingfisher Airlines has been facing problems for close to a year now.

Also read: Suspension and after

(This article was published on October 20, 2012)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.