Kingfisher Airlines to raise air fares?

Tuesday, October 21, 2008 at 2:10 am

Kingfisher Airlines head Vijay Mallya on Monday (Oct 20) said that unless the government intervened and helped the aviation sector the airlines may be forced to raise air fares. He also added that the slump in the market has affected India and if this continues then a number of flights may be grounded which would affect the work force as well.

“Firstly, the cost of fuel has become too high, secondly the sales tax imposed by the states is very high. If we increase the air fares people don’t want to spend too much money in this economy. So the government should rethink about the taxes,” Vijay Mallya, Chairman Kingfisher said.

“If the slump in the market continues then the number of flights will have to go down…. and when we ground the planes it will have effects,” Mallya, a former MP, told reporters outside Parliament. He was responding to a question on whether airlines may lay-off more employees in the near future.

He, however, refused to say whether he had met any minister or government official over the crisis in the aviation sector. Jet Airways chief Naresh Goyal today held a meeting with Finance Minister P Chidambaram.

Jet had recently removed 1900 employees only to reinstate them a day later, allegedly due to government pressure. However, Goyal had said that he changed his decision on humanitarian grounds. Mallya said the airline industry was going through a bad phase.

The flamboyant industrialist, who also has major stakes in the liquor business, said he did not have any complaints over the government’s response to the demands of the airline industry. “The government response has been a lot more urgent and a lot more decisive. The government has other issues to deal with in the national interest and we hope our turn will come sooner than later,” he said.

Asked about the turbulence in the economy, Mallya said, “This is not the first example, there are several examples in the world and governments have reacted to them.”

(Agencies)

( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by APakistanNews.Com.)

Kingfisher Airlines to raise air fares?

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