Kingfisher sues IAE over ‘defective’ Airbus engines

Vijay Mallya's United Breweries (Holdings) Ltd (UBHL), the holding company for the virtually defunct Kingfisher Airlines, has filed a case seeking about $236 million in damages from engine-maker International Aero Engines AG for allegedly supplying "inherently defective" engines, the airline said.

UBHL has filed a lawsuit against International Aero Engines and its shareholders in a court in Bangalore, Kingfisher said in its annual report, which was published on Monday.

IAE, part-owned by United Technologies Corp's Pratt & Whitney unit, competes with CFM International - a joint-venture of General Electric and France's Safran - to supply engines for Airbus A320 jetliners.

"IAE cannot comment on pending litigation," said Heather Waldron, communications manager for the US-based engine firm.

The lawsuit alleges that the IAE V2500-A5 engines supplied to Kingfisher were "inherently defective, both in design and manufacture", Kingfisher said.

Kingfisher has not flown since last October because of a funding crunch. Its flying licences expired at the end of last year and the company has so far had little success in a bid to revive operations.

Kingfisher, which had never reported a profit during its eight years of operations, is in talks with one potential investor in the airline as of 14 August, it said in the annual report, without naming any company.

A difficult operating environment as well as the engine problems "severely affected" its operations and finances during the year to March 2013, Kingfisher said.

The carrier had grounded 14 Airbus A320-family aircraft that used the V2500 engines during the year to March 2011 due to technical problems relating to the engines, it had said in its annual report for that year.

A Kingfisher spokesman did not comment beyond the annual report.