The Hindu : Business : No poaching on IA or AI for pilots

Online edition of India's National Newspaper
Sunday, May 01, 2005

Business

Business

No poaching on IA or AI for pilots

S.Dorairaj

Kingfisher to target the new generation Indians with world class service

Vijay Mallya

TOULOUSE (FRANCE): The Chairman and Managing Director of Kingfisher Airlines, Vijay Mallya, has made it clear that the newly launched aviation company will not poach on the Indian Airlines (IA) or Air India (AI) for recruitment of pilots.

Before taking delivery of the new airlines' brand new A320 Airbus here, he told the The Hindu that Kingfisher had ordered 30 A320 and three A319 aircraft at a total cost of $1.93 billion (Rs.8, 492 crores). Of them, the first 11 aircraft would be delivered before December 2005.

On the Kingfisher's policy with regard to recruitment of pilots, Mr. Mallya said, "we are comfortable with the first 11 aircraft. Even if there is shortage, I have issued clear instructions not to poach from the AI or IA. I sympathise with both the public sector airlines as they have been rendering good service to the country." But he also made it clear that the no-poaching deal was not applicable to private airlines, particularly in a free-market environment.

When asked about maintaining mandatory feeder services to the Northeast and other regions, he said according to a recent deal, the IA would fly to these areas on behalf of the Kingfisher.

The Kingfisher would pay Rs.115 crores to the IA annually for maintaining these services, he added.

As Kingfisher would outsource from the IA for its ground handling operations, the new airlines would not incur any expenditure on capital cost, he said. "Kingfisher is not a low cost airline. It is a full service one. By keeping the over-heads low, we will ensure that the operating cost becomes less. The airlines will target the new generation Indians by offering them world class service."

Referring to the project cost, he said finance was not a problem for taking the aircraft on lease. Arrangements had already been done in the case of taking delivery of ten planes. Kingfisher had appointed Caylon to negotiate and secure financing for the new aircraft. It was able to clinch the deal at a competitive list price financed through the ECA financing route, he pointed out.

Asked if he would make use of the `open sky' policy to operate to the neighbouring countries, Mr. Mallya said a decision would be taken on the basis of the assessment system built by the airlines.

Mr. Mallya said the airline would go public if necessary. As of now the focus would be on "building the value of the mother unit, United Breweries (UB). The Kingfisher has 100 per cent UB holdings." Emphatically denying that the UB would sell its stakes in other units, he said, "people keep spreading such rumours but my companies are not run with a `for sale' board. However, I am free to buy and sell shares, he added.

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