NEWS| Jet-Kingfisher to prune flights as part of deal

Senior officials of Jet Airways and Kingfisher are working out the contours of the alliance that the two airlines announced earlier this month, even as they fight for survival with their backs to the wall. The key issues being thrashed out revolve around the level of transparency between the two airlines and ways to ensure trust and reciprocity.

On the cards is a significant pruning of flights on routes where both operate, a pooling of assets and co-ordinated dealing with third parties like travel agents, global distribution system companies and hotels. Data shared would have to be about the fares at which they sell their seats, load factors on each of these flights and other such information, sources close to the developments said.

An initial confirmation came on Monday. Jet Airways CEO Wolfgang Prock-Schauer said on Monday that six of the airline’s large aircraft (Boeing 777 and A330s) will be grounded to reduce capacity and stem operating losses. The airline lost $60m on international routes, where these aircraft are deployed. A similar cut in capacity would be expected from Kingfisher, once the alliance goes on stream.
Consulting firm Accenture is advising the two on the structure of the deal. Vic Dungca, a close confidant of Jet Airways’ chairman, Naresh Goyal, and director on the airline’s board, is spearheading the talks from the Mumbai carrier, while the Kingfisher team is being headed by chief operating officer, Hitesh Patel, and the former Air Deccan CEO, Ramki Sundaram.
The alliance is critical to the financial health of the two airlines. Jet Airways posted a loss of Rs 384 crore in its Q2 results. The Kingfisher-Deccan combine is scheduled to declare its results for the first half of this fiscal on October 31, and is expected to announce similar losses.
29/10/08 Moneycontrol.com