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Monday 01-Aug-2011

Kingfisher may hive off low cost arm Kingfisher Red

The move is aimed at giving a better focus to the full service operations, which has been struggling to grow its market share

By  Traveltechie Bureau | Mumbai

Kingfisher Airlines is looking to hive off its low-cost arm Kingfisher Red into a separate entity, an official familiar with the development told moneycontrol.com. The move is aimed at giving a better focus to the full service operations, which has been struggling to grow its market share even as low cost rivals like Indigo and SpiceJet are steadily narrowing the gap as per a report in Moneycontrol by Shaheen Mansuri.

Kingfisher has a market share of 19.8% and is the number two player in the domestic sky. With its losses mounting, Kingfisher Airlines has been struggling to foot its fuel bills, which led to its dozen flights being grounded on a single day last month. The airline’s financial advisors have recommended hiving off Kingfisher Red into a separate division, as it will help the airline command more flight slots, and give it a better shot at improving market share.