The UB Group, which owns the Kingfisher beer brand, will invest US$750 million in buying 12 A-320 aircraft for a January 2005 launch.
The airline's branding will follow the image of the beer label and will carry the tagline, 'Fly the good time', echoing the beer brand's 'King of good times' positioning.
Mallya, chairman of UB Group claimed the airline would bring multiple strategic advantages to the group. "I couldn't advertise the beer brand due to regulations, therefore I made it a lifestyle brand that's also into bottled water and fashion. The airline industry presents huge growth opportunities and, besides other players might have to invest in building their equity, we already enjoy recognition of the Kingfisher brand."
The airline is also breaking new ground by grounding itself on a lifestyle platform and using images that drive it as a "funliner". It has also roped in leading fashion designers to create the aircraft's interiors, with every seat offering in-flight entertainment on demand and in-flight "silent auctions". Mallya has also dropped conventional flight attendants for "flying models", who will be selected following a Kingfisher 'Flying models contest'.
The airline is hoping to attract the young, upwardly mobile segment.
However, the airline's launch comes as a number of rival, low-cost airlines make their debut, including the Bombay Dyeing Group and India's national carrier Air India.
Despite its entry into the low-cost segment, Mallya added "my business model is certainly not to sell this airline cheap. It will not be a low-cost airline but a value based single-class airline".
While Kingfisher has not invited agengies to pitch, an airline spokesperson confirmed that J. Walter Thompson, which currently handles the Kingfisher brand, and Rediffusion DY&R, have sent in proposals.