Kingfisher airlines to exit low-cost sector

India-s biggest airline in terms of total market share Kingfisher Airlines has announced to exit the low cost airline sector within next 4 months. Kingfisher Airlines bought India-s first low cost airlines Air Deccan in 2007 to convert it to Kingfisher Red to cater to the low cost sector. In spite of trying for 4 years, Kingfisher Red has failed to gain any market share from other low cost airlines Indigo and Spice jet. While they are posting handsome growth, Kingfisher Red is still struggling to regain market share and turn the airlines into profit. The main reason behind its exit is high competition in that particular sector.

As of financial year 2010-11, Kingfisher Airline-s total debt crossed Rs 7,000 crore and has been continuously making losses since its launch. After exiting the low cost sector, it will retain its luxury service Kingfisher Class where the competition is comparatively less. The promoter of Kingfisher Red, UB holdings has also decided to restructure its total debt.