Crisis of Kingfisher Airlines

Topics: Indira Gandhi International Airport, Airline, Chhatrapati Shivaji International Airport Pages: 25 (6449 words) Published: June 8, 2013
Crisis of Kingfisher Airlines (Competitive SWOT Analysis, PEST and Porter Modle application)

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Table of Contents

I. Crisis of Kingfisher Airlines – Abstract . . . . . . . . . . . . . . Page 3 II. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 5 III. Competitive Advantage for Apple Inc. . . . . . . . . . . . . . . Page 5 IV. PC industry over view . . . . . . . . . . . . . . . . . . . . . . . . . Page 7 V. Porter’s Five Forces Model . . . . . . . . . . . . . . . . . . . . . . Page 10 VI. Apple’s Macintosh Business overview . . . . . . . . . . . . . . . Page 12 VII. Apple’s iPod-iTunes Business overview . . . . . . . . . . . . . . Page 14 VIII. Apple’s iPhone Business strategy. . . . . . . . . . . . . . . . . . .Page 15 IX. References

INDIAN AVIATION INDUSTRY……………………………………………………………9

- EVOLUTION……………………………………………………………………………….09

- PESTE ANALYSIS…………………………………………………………………………13

- PORTER’S FIVE FORCE ANALYSIS………………………………………………..19

- SWOT ANALYSIS…………………………………………………………………………22

- PORTER STRATEGIES…………………………………………………………………..24 CRISIS OF KINGFISHER AIRLINES

Abstract

The Indian air market is estimated to be the ninth largest in the world but with the population size the country has, the Indian government believes it will become the world’s third largest market by 2020. 87 foreign and five Indian airlines fly to and from India to 40 countries. Approximately five million Indians fly every month domestically. Domestic traffic more than doubled between Jul-2006 and July 2011, with growth of 101%. One reason for the growth was the deregulation of Indian domestic aviation in 2003- 2004 followed by international deregulation in 2007-2008

India has three full service airlines Air India, Jet Airways, Kingfisher Airlines and four Low cost carriers:  GoAir, IndiGo, JetLite (owned by Jet airways), and SpiceJet. Kingfisher also had a discount version: Kingfisher Red known formerly as Simplifly Deccan and before that Air Deccan. 

Ironically the Indian aviation despite a market growing at 18 per cent for last 11 months, five out of six Indian airlines are bleeding leading to the failure of one of the leading aviation player - Kingfisher Airlines.

Kingfisher Airlines, a subsidiary of UB Group (United Breweries Holdings Ltd), founded in May 2005 operates a passenger airline in India. It was the first airline in India to provide premium first class service on domestic routes with all new aircraft. In May 2007, it announced it would acquire a 26% stake in Air Deccan, a low cost carrier (LCC) for 5.5 billion rupees ($135 million). Kingfisher Airlines Limited came to become one of the country’s largest airlines, operating more than 400 flights a day and having a wide network of destinations, with regional and long-haul international services touching almost 60 destinations.

At one point the Kingfisher Airlines had the second largest share in India's domestic air travel market. However due to the severe financial crisis faced by the airline, it has the fifth largest market share currently. Even the company have no funds to pay the salaries to the employees and is facing several other issues like fuel dues; aircraft lease rental dues, service tax dues and bank arrears.

As Kingfisher airlines is in the midst of a financial turmoil, the case will aim to understand the various factors which are fuelling the growth / decline and those which are/will be critical for the company’s performance in the near term.

Introduction

History of the Indian Airline Industry

In December 1912, the first domestic air route was opened between Delhi and Karachi by the Indian State Air Services (in collaboration with Imperial Airways of the UK). This marked a new beginning in India. Three years later, Tata Sons started a regular airmail service between Karachi and Madras. At that time, there were a few transport...

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* Reference - Business Standard, June 3, 2007, p-4
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