PIA to be completely revamped

KARACHI: They used to be ‘Great People to Fly With’ but, over recent years, PIA has suffered in more ways than one. An organization that was responsible for launching Emirates, one of today’s most successful airlines, PIA is now in need of a saviour who would rescue it from the quagmire it currently finds itself in. The past few decades have been marred with mismanagement and corruption leading to an off-colour financial performance and issues which translated into flight delays and poor cabin service.
While a weak financial position, political interference and the devaluation of the local currency are all serious problems that PIA has had to contend with, the sharp increase in oil prices over the years also severely hampered its ability to perform well. Until recently, the price of jet fuel was very high and, much like other international airlines, PIA also struggled to make ends meet as the fuel cost ate into the airline’s revenues. PIA suffered a major loss during 2005-2008, a consequence of the high fuel prices and steady decline of the Pakistani rupee in the international market.
However, the precipitous dip in international oil prices recently has turned out to be the most significant albeit unexpected force in the global economy. Thanks to a combination of increased production and low demand, the price of crude oil has fallen considerably and one of the beneficiaries of this drop has been the transportation sector, particularly the airline industry. It is good to see that owing to various corrective measures and a more proactive management, PIA’s profitability is picking up and the airline is creeping towards better operating results. PIA made a profit of Rs2.83 billion in the first quarter of 2015, while during 2014 first quarter, it reported a loss of Rs3.93 billion. The reduced fuel prices and induction of fuel efficient aircraft have led to a 49 percent decline in fuel costs for the airline.
Experts say the example of PIA serves as a classic case in the aviation industry because this is one airline which has returned from the edge of collapse simply because its management and staff refused to be cowed down by failure.
The fact that PIA has gone for dry-leased aircraft has also worked well for the airline. The PIA fleet is now being rationalized through induction of modern, fuel efficient, narrow bodied aircraft. In this connection, two Airbus A-320 aircraft have been recently acquired on dry lease. This has increased the number of A-320 aircraft in the PIA fleet to five. From June, 2015, more A-320s would be added to the fleet. PIA has also added two ATR-72-500 turboprop aircraft to its fleet for short and feeder routes and more such aircraft are to be added soon.
PIA has also brought about noticeable improvements in punctuality and passenger handling. The result is that more PIA flights depart and arrive on time than before which is improving passenger confidence in the airline. It is important to remember that through all the smooth and rough, PIA has maintained a very good safety record and offers passengers the prospect of a safe and secure flight whether operating within Pakistan or on international routes. The issues of terrorism and militancy have also not been allowed to mar its services.
Overstaffing is an area that has been bothersome for the airline; it has at present one of the highest aircraft-to-staff ratios in the industry. However, it needs to be remembered that besides functioning simply as an airline, PIA is engaged in so many other ground-based activities which require additional staffing and this aggravates the overall employee numbers. The management is looking at ways to bring down the ratio through staff rationalization. Addition of more aircraft will also serve to improve the ratio.