Kingfisher Airlines halts flights

The airline owned by brewery tycoon Vijay Mallya (pictured below) has suspended international flights.

Kingfisher Airlines is laden with debt to the tune of US$1.3 billion and has announced an end to all international flights throughout the summer, though it will continue to operate domestic flights within India.

It has been in serious debt since at least 2005 and in the last quarter of 2011 posted a loss of US$90m.

The airline was recently suspended from the International Air Transport Association (IATA) following a freeze on its bank accounts by tax authorities.

Mallya said after a meeting with India’s civil aviation authority: “We have decided to suspend our international operations as we are not on IATA platforms.”

Another smaller airline formerly owned by Mallya, Air Deccan later rechristened Kingfishers Red, was shut down in 2011 due to financial difficulties.

Several other Indian carriers are in financial difficulty at present, a situation blamed on high fuel costs, landing tariffs, price wars and currency fluctuations.

The situation is so severe for some companies that some papers have even carried stories recently of passengers made to pay extra for the fuel if they wanted their plane to take off.

Mallya is the chairman of the United Breweries Group and as well as owning a brewing empire and – now struggling – airline, he is the co-owner of the Formula 1 team, Force India, and the Indian cricket team Bangalore Royal Challengers, as well as two Indian football teams.

In May 2007, United Breweries announced that it was buying Scotch whisky maker Whyte & Mackay, making the distilling arm of the business one of the largest in the world.