"Some 60-80 engineers have already quit the carrier in the last 4-5 months, as they could not sustain non-payment of salaries. And more are planning to do so," airline sources said.
Also read: Kingfisher Airlines flies towards point of no return
Some more engineers are in the process of bidding good-bye to the carrier, they said, adding that "if the trend continues, the airline may face severe shortage of engineers".
Here are five reasons the airline needs to worry:
1. The airline is now at the bottom of the market pie with its share nose-diving to a mere 5.2 per cent in May from as high as 20 per cent last year on account of a truncated flight schedule.
2. The airline, which has not posted profit since its inception in May 2005, made a loss of Rs 1,151.5 crore in the March quarter, has debt of over Rs 7,500 crore and an equal amount of accumulated losses. The Bangalore-based carrier, which has also been defaulting on tax payments as well as bills to its vendors, has been seeking fresh bank funds since last December apart from trying to raise overseas funds unsuccessfully.
3. The airline’s shares have plummeted more than 80 per cent since the beginning of 2011, shrinking the airline's market value to just under $100 million.
4. India's plans to allow foreign airlines to invest up to 49 per cent in local carriers, which Kingfisher has lobbied hard for, has not yet to be approved, adding to its funding crisis. Mallya has repeatedly insisted that several domestic and international investors are interested in his company, and for months the names of many foreign airlines and local tycoons have been reported as prospective "White Knights", but so far there has been much talk and no money.
5. Kingfisher needs at least $500 million immediately to keep flying, according to the Centre for Asia Pacific Aviation. If Kingfisher fails to turn the airline around, its lenders would be left to pick over the carcass in a country that does not have a formal bankruptcy process. European aircraft maker Airbus has already accommodated Kingfisher by pushing its aircraft deliveries back in the queue. The company would lose orders for 92 planes with a combined list price of $12 billion if Kingfisher is unable to pay up. It would also see Kingfisher's fleet enter the second-hand market.
With inputs from agencies