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SriLankan downplays PIA delay in taking over leased A330-300
Pakistan International Airlines (PIA) has delayed taking over an A330-300 aircraft it agreed to lease from SriLankan Airlines.
“PIA has been under a huge workload due to unrelated issues reported in the press,” said SriLankan Chief Executive Officer, Suren Ratwatte. In mid-2016, PIA took possession of one A330-300 which it leased from SriLankan. It also signed agreements for two more of the same.
One of these was to have been taken over in December. “This has been postponed to January,” confirmed Mr Ratwatte. “The third aircraft will be taken over in March or April, subject to crew availability.”
On December 7, a PIA plane on a domestic flight, crashed in a mountainous area killing all 47 passengers. Reports say the incident plunged the airline “into a serious operational crisis”. Among other things, it was forced to ground 18 of its 34 planes.
“PIA had a crash of a smaller aircraft in the week they were due to take the second A330,” a SriLankan official said. “That is an awful event and they have been coming to terms with it since. We have given PIA time and space to recover.”
It is alleged that SriLankan had sustained massive losses by grounding the respective airplane in anticipation of PIA taking charge of it. But the CEO vehemently rejected this, claiming that the company had used the aircraft heavily during the busy Christmas period. The A330-300 was even flown to destinations such as Male and Chennai, despite it being a long-haul aircraft.
“Utilisation was very high,” Mr Ratwatte reiterated. However, it was not possible to independently verify this, as he flatly refused to disclose average utilisation rates for each of SriLankan’s A330-300s. He maintained it was confidential information and only repeated that SriLankan was using the aircraft “well above industry norms”.
It has also been reported that PIA had fallen behind in its rental for the one A330-300 in its possession. However, Mr Ratwatte attributed any delay to bank holidays in the United States over Christmas. Payments, he claimed, were up to date. Again, it was not possible to independently verify his claim.
Meanwhile, PIA, which is, by all accounts, in serious financial difficulty, has asked for a discount on the lease rental for the other two A330-300s. “Discussions are ongoing,” the CEO said, without commenting on specifics. “The rental price is not agreed on yet.” There is a three-way conversation now between SriLankan, PIA and the lessors to reach agreement.
The SriLankan Management’s decision to lease the A330-300s to PIA has been heavily criticised in some quarters where it is felt, the better option would have been to retain the European routes (shelved in October 2016, but for London) and to fly them on those.
SriLankan has itself leased the A330-300s from AerCap, the US-based aircraft leasing and aviation finance company. The deal with PIA is, therefore, a re-leasing operation.