Mallya and Gopinath are all set to create history in Indian aviation
It took no rocket science to predict a serious churn in the industry, when liquor-turned-aviation baron Vijay Mallya sounded his bugle on the Deccan stake buyout last year. And as Mallya gradually increased his stake to take control of Deccan Aviation (parent to Air Deccan), he indisputably branded himself as the monarch of Indian skies.
Late last year, Air Deccan embraced the flying-bird logo of Mallya’s Kingfisher airlines and the combined entity has gone on to straddle both the high-end and low-cost segments of air travel in the country. Talks of a reverse merger are now doing the rounds for the merged entity, with Mallya as Chairman and Capt. Gopinath as Vice Chairman.
However, as Kingfisher Airlines enters 2008, so do clouds of suspicion and skepticism. The ‘Mars and Venus furor’ by Gopinath that captured headlines till some days before the 26% stake buyout have now truly become symbols of a mega experiment, about which some in the trade are skeptical. The logic is that two carriers from different spectrums have never been a profitable couple. However, if all goes well, the combined entity may well stake a generous claim to a hefty market share in the Indian skies. On the one hand, Air Deccan will fight on the price front (it is already the largest player in the LCC segment) and on the other, Kingfisher Airlines will target the high-end travellers. In addition, if and when the reverse merger with Air Deccan is complete, Kingfisher will also have access to international routes (since Deccan would soon be eligible for flying abroad going by government’s five year waiting-period rule), destroying any advantage that Jet currently has.
“I have succeeded in creating an Airline Group with the largest domestic fleet, network and market share co-leadership in just over 2 years,” says Mallya, hailing it as a move toward consolidation in the industry. With the Indian aviation sector growing at above 20% over the last few years, all are now keenly watching Mallya & Gopinath’s tango, as they offer both low-cost and premium offerings, under a single roof. If they manage to pull off this mega experiment (and we wish them the very best) it would then pave the way for another chapter in the history of aviation...
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Source : IIPM Editorial, 2008
It took no rocket science to predict a serious churn in the industry, when liquor-turned-aviation baron Vijay Mallya sounded his bugle on the Deccan stake buyout last year. And as Mallya gradually increased his stake to take control of Deccan Aviation (parent to Air Deccan), he indisputably branded himself as the monarch of Indian skies.
Late last year, Air Deccan embraced the flying-bird logo of Mallya’s Kingfisher airlines and the combined entity has gone on to straddle both the high-end and low-cost segments of air travel in the country. Talks of a reverse merger are now doing the rounds for the merged entity, with Mallya as Chairman and Capt. Gopinath as Vice Chairman.
However, as Kingfisher Airlines enters 2008, so do clouds of suspicion and skepticism. The ‘Mars and Venus furor’ by Gopinath that captured headlines till some days before the 26% stake buyout have now truly become symbols of a mega experiment, about which some in the trade are skeptical. The logic is that two carriers from different spectrums have never been a profitable couple. However, if all goes well, the combined entity may well stake a generous claim to a hefty market share in the Indian skies. On the one hand, Air Deccan will fight on the price front (it is already the largest player in the LCC segment) and on the other, Kingfisher Airlines will target the high-end travellers. In addition, if and when the reverse merger with Air Deccan is complete, Kingfisher will also have access to international routes (since Deccan would soon be eligible for flying abroad going by government’s five year waiting-period rule), destroying any advantage that Jet currently has.
“I have succeeded in creating an Airline Group with the largest domestic fleet, network and market share co-leadership in just over 2 years,” says Mallya, hailing it as a move toward consolidation in the industry. With the Indian aviation sector growing at above 20% over the last few years, all are now keenly watching Mallya & Gopinath’s tango, as they offer both low-cost and premium offerings, under a single roof. If they manage to pull off this mega experiment (and we wish them the very best) it would then pave the way for another chapter in the history of aviation...
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
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