Kingfisher Airlines Resumed Wage Payments

Thursday, 12th April 2012 at 12:51pm

The financially troubled Kingfisher Airlines recently received good news and is sharing them to its employees. Kingfisher Airlines' chief promised to give the long overdue wage payment to its employees as the government unfroze Kingfisher's bank accounts

Kingfisher already owe a lot of suppliers, lenders and even its own staff millions of dollars, but the airline who is very much in danger of a collapse got its first breather as its bank accounts were unfrozen after Kingfisher was able to pay its tax arrears.

Kingfisher owner and liquor magnate, Vijay Mallya, wrote a letter telling the airline staff that he can finally get on with giving the employees their pay checks. Kingfisher employees, especially those who weren't able to receive their pay since December, no longer believe Mallya's assurances and are demanding that they be paid their wages the soonest time possible.

Kingfisher was able to pay $12.5 million tax arrears giving way to the Indian government's move of unfreezing of the airline's bank accounts. Kingfisher is said to have about $1.5 billion net debt and at least $400 million for this month alone to stay in the air, this according to an industry consultancy, the Centre for Asia Pacific Aviation.

Although India's private airlines is in a fast-growing market, most airline companies are still struggling because of high fuel costs and the fierce competition in the market. Analysts say that by far Kingfisher's problems have to be the worst, a problem caused also by its excessive rapid expansion.

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