Kingfisher + Deccan: Hope trumps reality

Bangalore: When liquor baron Vijay Mallya and low-fare aviation pioneer Capt GR Gopinath decided to tango on Thursday, the prime reason they gave for the decision was synergy. Using the your-beauty-and-my-brains logic, the two said that Kingfisher’s upmarket full-service carrier (FSC) will complement the no-frills airline’s mass market, with infrastructure being shared for cutting costs for both airlines.
History, unfortunately, is not on their side. Full-service carriers and low-cost carriers (LCCs) belong to separate worlds, and their DNAs seldom match.
It happened when UK’s full-service carrier British Airways got together with budget carrier Go. It was repeated with Delta Air and Song. When Germany’s Lufthansa tried to soar high with GermanWings, it crashed, too.
But if Mallya and Gopinath are looking for more cheerful examples, they should look down under. Australia’s full service airline Qantas took a shot at running no-frills airline Jetstar Asia and came up trumps. So what clicked with Qantas?
Industry players and experts say Qantas’ model has worked because Jetstar’s operation was insulated from any Qantas influence.
And it’s not just economic issues that necessitate an arm’s length distance between two. Culture clashes can also cause havoc.
“While one is used to pampering its passengers by totally focusing on services, the other is used to taking out frills from services and saving cost. Apart from engineers and pilots, even the workforce - the cabin crew, airport staff and others - cannot be common as they are tuned to different cultures,” says SpiceJet Ltd CEO and chairman Siddhanta Sharma.
Says IndiGo president and CEO Bruce Ashby: “There were several of such experiments in the US but they were eventually abandoned.” United Airlines started ‘Shuttle by United’, Delta tried with ‘Delta Express’ and US Airways tried ‘MetroJet’.
02/06/07 Praveena Sharma/Daily News & Analysis

To Read the News in full at Source, Click the Headline

Categories: Air Deccan Jun 2007, Kingfisher Jun 2007