First, the Maharaja became a pauper, and now it is the turn of the ‘king of good times’. Kingfisher Airlines, India’s premier luxury air operator, is facing the same fate that the national carrier has faced in recent times. Like Air India, Kingfisher too is going through a severe financial crunch, an exodus of pilots and industry observers say they won’t be surpised if it goes turtle soon.

The cash-strapped airline has grounded more than 120 flights over the last four days. More than 130 staff pilots have also quit in the past few weeks.

While civil aviation minister Vayalar Ravi has said that the government will make efforts to speak to banks for a possible bailout of Kingfisher, aviation experts feel that the bailout will not solve the issue, as an Air India like debt recast is not possible in this case.

Ravi spoke to finance minister Pranab Mukherjee and oil minister S Jaipal Reddy after ‘king of good times’ Vijay Mallya sought his help. Kingfisher’s loss is more than Rs 1,000 crore in this financial year and bank loans of Rs 7,000 crore have hit the performance of the airline.

Jitendra Bhargava, an aviation expert and former executive director of Air India, says, “The debt-ridden company is struggling with a deep financial crisis and the bailout will prove to be a futile effort. Only a right business model will help the airlines to continue flying. The whole climate needs a change, otherwise most other airlines will meet the same fate. Low-cost carriers are not able to recover their cost so a good policy may help.”

Sources reveal that Delhi International Airport Ltd (DIAL) and the Airports Authority of India (AAI) have also pulled back their support and imposed cash-and-carry on the airlines. It means the company will have to pay first to use their services and no more credit will be offered to it. Kingfisher owes about Rs 220 crore to AAI alone.

Kingfisher also owes more than Rs 600 crore to the state-run Hindustan Petroleum (HP). Like HP, Bharat Petroleum is also not supplying fuel to the airline due to non-payment of about Rs 250 crore. Indian Oil Corporation is also working on cash-and-carry model.

The sources also say that the companies which have lent aircraft to Kingfisher are planning to withdraw them.

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Troubled Kingfisher seeks govt help, flight curtailment on

Facing serious financial turbulence, Kingfisher Airlines has sought government help for a bailout even as it continued its flight curtailment spree for the fifth consecutive day on Friday and its stocks plummeted by over 19 per cent to an all-time low but recovered slightly later.

The seriousness of the crisis was underlined by the urgent request Kingfisher owner Vijay Mallya made to finance minister Pranab Mukherjee and civil aviation minister Vayalar Ravi to help Kingfisher in infusion of funds through banks at low interest rates, besides other concessions in line with what Air India was getting, sources said.

However, there was no official word immediately on whether any step was being taken on Mallya's request made earlier this week.

Some 50 pilots and cabin crew did not turn up for duty by reporting sick as over 40 flights were cancelled across its network on Friday.

Innumerable passengers across the country cancelled Kingfisher flight tickets to travel by other airlines, though after paying 20-40 per cent higher at the last moment.

The airline, which had earlier said it would restore its flights after October 19, has now indicated that it would take a few more weeks to normalise the flight schedule, that would go into the peak winter season air traffic.

Apart from taking aircraft off flights to reconfigure and install business class seats in them, airline CEO Sanjay Agarwal told PTI, "We decided to reduce frequency in some of the routes where we had multiple flights like Delhi-Mumbai or low passenger load like Nanded-Mysore."

This exercise was part of route rationalisation to improve profitability and revenue productivity of the flights, he said.

Asked whether they had responded to the show-cause notice issued by the Directorate General of Civil Aviation (DGCA), Agarwal said, "We are in close touch with them. We are explaining to them that these cancellations are temporary in nature. We are keeping them informed."

DGCA has issued the notice under Rule 140(A) of the Aircraft Rules, 1937, asking Kingfisher why it had not taken the regulator's prior approval to curtail its flight schedules as required by this rule. It has also sought to know whether the airline had taken any step to facilitate the passengers inconvenienced by the cancellations.

Meanwhile, all the oil PSUs -- HPCL, IOC and BPCL -- have denied extending credit line to the liquor baron Mallya-owned airline and asked it to pay for lifting jet fuel on a daily basis.

The airline has suffered a loss of Rs 1,027 crore in 2010-11 and has a mounting debt of Rs 7057.08 crore.

To questions on alleged exodus of pilots and cabin crew from the airline, Agarwal, "There is a process of natural attrition. Pilots and other staff come and go. If you put the number of pilots who have left in over 7-8 months, it could be 100.

"This has not happened all of a sudden as is being projected. Not a single Kingfisher flight has been cancelled due to shortage of crew as is being reported. We have over 650 pilots on our rolls now," the airline CEO maintained.

Industry sources said the lessors of Kingfisher's leased turboprop ATR aircraft fleet have put the airline on notice and want urgent payments for the lease.

The cash-strapped carrier also has unpaid dues to the operators of airports and other agencies, which have also been putting pressure on it to expedite payment.

Meanwhile, Kingfisher's shares slumped by over 19 per cent to an all-time low on the bourses, before recovering some ground.