Kingfisher Airlines Failure
It's hard to establish an airline business however, it's even more challenging to sustain it in the long run. Kingfisher was dubbed "The King of Good Time," was a major airline for passengers. It was established at the end of 2003 through United Breweries Group, a Bengaluru-based company. It quickly grew to become the country's fifth largest passenger airline that offers customers international and domestic flights for reasonable rates. Kingfisher's founder, Vijay Mallya was a professional in the industry of brewing. He is now regarded as the baron of liquor. Despite his experience in the area, he was not experienced in managing companies such as airlines, leading to the loss of the Kingfisher Airlines.
These are some of the main reasons Kingfisher was unable to complete the task
Purchase of Air Deccan
Expansion of The International Arena
Instability At The Apex Management Level
Moving to Premium Class Airline into the low-budget segment
Acquisition of Air Deccan
First, the company acquired Air Deccan, a low-cost airline. While KFA took over all Air Deccan's market and aircraft as well, it also took on the losses.
Expanding in The International Arena
Another option that affected KFA's performance was the rapid introduction of overseas services. After the acquisition of Air Deccan, KFA entered the international market. The entrance into a huge market could have been great following the consolidation of the domestic service that had taken a large share in the Indian market. KFA's attempt to expand internationally was an unqualified fail. This was always going happen. It was always to end up. In the tumultuous ocean of global competition, would someone without any experience with domestic airlines be successful? Emirates and Etihad for instance had a monopoly on international airspace and had a loyal customer base. It was difficult for the newly formed KFA to break the dominance, and ultimately was unable to succeed.
Instability at the Apex Level of Management
Lack of consistency within the highest levels of the organisation is another factor that led to the downfall of KFA and its eventual demise. The KFA owner, as was previously mentioned was a newcomer in aviation, and the CEO was responsible for the direction of the company. There was no CEO in contrast was employed with KFA over one year. If KFA had employed a seasoned CEO such as Gopinath from Air Deccan and kept him for the entire term of five years it could have turned out differently. Malley's business interests, apart from brewery operations and KFA were diverse and desperate. Since the breweries were managed by highly skilled workers and his company was booming, his booze business grew. KFA On the other hand, didn't get the same fortune. Because of his political connections (Vijay Mallya was an Rajya Sabha member of the House of Representatives)
Moving between Premium Class Airline into the low-budget segment
KFA was recognized as a top airline catering to the demands of top-ranking political leaders and business executives. In a brief time the airline steadily built its reputation. But it began to lose its appeal when it began to enter the low-cost marketplace. The market with low costs was not an easy one to navigate. The market was dominating by Indigo, SpiceJet as well as other competitors. It was a challenge, particularly on the domestic market. There was a lot of competition and KFA's hopes of making quick cash ended up being a failure. The service of KFA deteriorated with time, and people switched their loyalty towards other carriers.
Conclusion
The inability of the team to make sound decisions has resulted in KFA's demise as one India's top airlines. Acquisition of Air Deccan, the service's rapid expansion into the international market and the shift of its segments, which led to the rivalry, were all major elements in the demise of KFA. External factors like the cost of aviation fuel might be a factor. The price of fuel used by KFA increased over time. Every airline, even competitors of KFA are facing this problem however they have come up with strategies to deal with the issue.
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