PIA adds A-320 to its fleet
Aircraft dry leased for six years, plans to include two more to fleet.
KARACHI:
Pakistan International Airlines (PIA) announced the induction of an Airbus 320 in its fleet and plans to include two more such planes to bolster domestic and regional flight operations.
The 180-seat aircraft has been dry leased from GE Capital Aviation Services for a period of six years at a critical time when the country’s aviation sector has been under immense scrutiny.
“It is an achievement of PIA employees that they made sure this deal materialised because no one is enthusiastic about giving us planes,” said PIA Managing Director Junaid Yunus. “And we badly needed new aircraft.”
PIA recently returned four A-320s and Boeing 727-800 aircraft, which it had brought in on a much shorter wet lease in December 2013. It now has 31 aircraft in its fleet with an average age of 16 years but some of them are 24 to 27 years old.
“We need newer, fuel-efficient planes like A-320s to run on shorter routes within Pakistan and in the Middle East. Around 74% of our business comes from these places. If we only have 14 such aircraft, this airline would come out of the red,” said Yunus.
The state-owned carrier has been struggling to arrange funds for leasing more planes for months now. However, it plans to open another tender for another 10 narrow body aircraft. Insufficient numbers of aircraft was also one reason that led PIA to book its worst loss of Rs43.65 billion in 2013. “There is nothing we can do without the planes,” says Yunus.
The government has all along maintained that PIA and other loss-incurring public sector enterprises, which are a drain on the national exchequer, will be privatised. PIA is now hanging in the balance as government support remains imperative for its revival.
It pays billions of rupees every year in interest payments, shrinking its limited margins. The loans also requires it to seek government guarantees as banks are reluctant to lend the airline on basis of its balance sheet with entire equity being wiped out after successive losses.
On its part, the airline has taken multiple steps to regain the market share lost to domestic and regional carriers. It is focusing on improving its products by adding facilities like Wifi and phone service to appease customers.
Published in The Express Tribune, June 29th, 2014.
Pakistan International Airlines (PIA) announced the induction of an Airbus 320 in its fleet and plans to include two more such planes to bolster domestic and regional flight operations.
The 180-seat aircraft has been dry leased from GE Capital Aviation Services for a period of six years at a critical time when the country’s aviation sector has been under immense scrutiny.
“It is an achievement of PIA employees that they made sure this deal materialised because no one is enthusiastic about giving us planes,” said PIA Managing Director Junaid Yunus. “And we badly needed new aircraft.”
PIA recently returned four A-320s and Boeing 727-800 aircraft, which it had brought in on a much shorter wet lease in December 2013. It now has 31 aircraft in its fleet with an average age of 16 years but some of them are 24 to 27 years old.
“We need newer, fuel-efficient planes like A-320s to run on shorter routes within Pakistan and in the Middle East. Around 74% of our business comes from these places. If we only have 14 such aircraft, this airline would come out of the red,” said Yunus.
The state-owned carrier has been struggling to arrange funds for leasing more planes for months now. However, it plans to open another tender for another 10 narrow body aircraft. Insufficient numbers of aircraft was also one reason that led PIA to book its worst loss of Rs43.65 billion in 2013. “There is nothing we can do without the planes,” says Yunus.
The government has all along maintained that PIA and other loss-incurring public sector enterprises, which are a drain on the national exchequer, will be privatised. PIA is now hanging in the balance as government support remains imperative for its revival.
It pays billions of rupees every year in interest payments, shrinking its limited margins. The loans also requires it to seek government guarantees as banks are reluctant to lend the airline on basis of its balance sheet with entire equity being wiped out after successive losses.
On its part, the airline has taken multiple steps to regain the market share lost to domestic and regional carriers. It is focusing on improving its products by adding facilities like Wifi and phone service to appease customers.
Published in The Express Tribune, June 29th, 2014.