The PIA albatross

Few can doubt that the Pakistan International Airways (PIA) is in desperate trouble and has been for many years. Many hark back to a golden past, the days when PIA provided the seed-corn which enabled the startup of the now hugely successful Emirates airline in 1985. The days when PIA’s service was an airline industry benchmark. Golden pasts are rarely regained, sick airlines have a global tendency to fail and PIA has been hemorrhaging money at a rate which virtually guarantees a massive restructuring. The government of Nawaz Sharif inherited the PIA albatross from its predecessor, which had done little to alleviate the systemic problems of chronic over-manning, indifferent or inept management and a questionable maintenance record. The government plans to sell off 26 per cent of the troubled carrier in a partial privatisation, but the 16,600 employees are hoping that their current management are going to protect their jobs with a plan unveiled on September 23.

The managing director appeared confident that by adding profitable routes it would be possible to increase revenues and possibly break-even within a year. This would be a startling turnaround if achieved. He claimed that the salary bill was not the biggest of his problems and that staffing would drop to 12-13,000 over the next five years — which would still leave PIA with the highest manning level per aircraft in the world. The airline has 26 operational aircraft out of a fleet of 38 and needs new aircraft — which it cannot afford. Pakistan cannot afford a national carrier that eats three billion rupees a month and although the PIA management appears to be taking an upbeat position, the reality is that the surgery of privatisation is fundamental to the airlines continued existence. Buying time with hopeful paper strategies is not going to work today any more than it has in the past. There may be pride in having a national airline but pride does not pay the bills, profit does. Time for change, PIA.

Published in The Express Tribune, September 25^th,  2013.

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