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Flight of trust: Kingfisher crashes to ground zero
The erosion has been steady for the Kingfisher airline brand in the past year or so.
From a valuation of about $500 million (or Rs 2,500 crore) two years ago, the brand on Wednesday is down to zero as planes remain grounded, its licence to fly suspended and lenders lose patience with it.
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Flight of trust: Kingfisher crashes to ground zero
On Tuesday, a consortium of creditors, led by the State Bank of India, decided to recall all loans, amounting to Rs 7,500 crore (Rs 75 billion), to the airline operator.
This move will include the sale of pledged assets and invoking promoter Vijay Mallya's personal guarantees.
While the airline's fall from grace has been rapid, the other aspect has been a clear trust deficit it suffers with consumers.
According to N Chandramouli, chief executive, Trust Research Advisory, which releases the annual Brand Trust Report, a ranking of brands based on the trust they enjoy among consumers, Kingfisher ranks nowhere among the airline operators in the country.
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Flight of trust: Kingfisher crashes to ground zero
This is in stark contrast to the scenario two years ago, when it led the pack by a comfortable margin.
"On an all-India basis, Kingfisher was ranked 97th in 2011, ahead of Air India.
"Among carriers, these were the two most-trusted brands in our ranking then. By 2012 and now 2013, Kingfisher has dropped out of the list, while Air India continues to be there, despite having problems of its own.
Air India was the most-trusted airline brand in 2012, with an all-India ranking of 150, followed by Jet Airways at 273.
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Flight of trust: Kingfisher crashes to ground zero
"This year, IndiGo Airlines, ranked at 104, has emerged as the most-trusted brand, followed by Air India at 145 and Jet at 387," said Chandramouli.
Rival carriers have wasted no time in filling the slot left vacant by Kingfisher in the last two years.
"IndiGo wasn't even in the list two years ago; on Wednesday it leads the pack," he added.
Many factors seem to have worked for IndiGo, say experts, from on-time performance to fiscal discipline and prudence.
"All this goes a long way in establishing your credibility with consumers, as well as allied stakeholders," says Nabankur Gupta, founder-CEO, Nobby Brand Architects.
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Flight of trust: Kingfisher crashes to ground zero
Contrast this with the picture that Kingfisher presents and there is hardly anything to write home about, say experts.
The debt-laden airline has been grounded since October 2012 and there is no revenue that it earns as a result of this.
"In my view, the Kingfisher brand hit rock-bottom six months ago when it reneged on its word to pay salaries and other dues," says Harish Bijoor, CEO, Harish Bijoor Consults.
Despite this, Kingfisher CEO Sanjay Aggarwal has said that the operator hoped to pay employee salaries shortly, besides looking to resume operations this summer.