Flying high or lying low?
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Kussi Amma Sera was reading the Lankadipa newspaper when she came across, what she later called “rasawath puvathak (interesting news)”, this Thursday morning.
“Paththare kiyanawa Shri Lankan guwan sevaye godak guwan gaman parakku-wela kiyala (It says here that there were many flight delays by SriLankan Airlines),” she said.
“Meda peradiga yana samahara magey yaluwanta mae parakkuwa saha guwan gaman avalangu kireem balapala thiyenawa (Some of my friends going to West Asia were also affected by the delays and in some instances the flights were cancelled),” noted Serapina.
“Shri Lankan guwan sevaye mae karadara hadisiyema patan aran. Mokada danney nae (The problems at SriLankan Airlines are suddenly happening. I wonder why),” asked Mabel Rasthiyadu.
“Eh lipiya kiyanawa karya mandalaye goda denekta pita rata rassawal labila kiyala (The article says that many of their staff have got overseas jobs),” added Kussi Amma Sera.
Indeed, the national carrier is going through trying times adding to the loss of revenue during the COVID-19 pandemic followed by the debilitating economic crisis last year.
At this point, the home phone range. It was ‘Human Resource’ pundit HR Perera, popularly known as HR, calling this morning.
“I say……SriLankan Airlines seems to be in a lot of trouble. It has been delaying or cancelling many flights these days,” he said.
“This trend is not good for the airline and the country, with a large number of arrivals expected during the winter season – locals and foreigners – from around next month (November),” I said.
“Ever since the airline didn’t renew a partnership with Dubai-based Emirates in March 2008 following a dispute between the two airlines, the national carrier has been suffering huge losses,” he said.
“Whenever politics precede business interests, it results in losses and in this case, the moment Emirates exited the airline, it was clear the airline was going the wrong way,” I said.
In 1998, the government sold a 40 per cent stake to Emirates worth US$70 million. Emirates then exited the airline end-March 2008, deciding to withdraw when the partnership agreement came up for renewal. The airline was reporting profits under Emirates management but after the foreign operator withdrew, the airline began reporting huge losses.
According to official sources, the recent delays in flights or cancellations happened due to technical issues resulting in a number of aircraft being grounded at the same time. The airline has been rapidly losing staff, particularly pilots and technical officers.
In a statement on September 29, the airline said that over the last few days, SriLankan Airlines has had to cancel several flights mainly due to a number of technical issues which required temporary grounding of aircraft. “These are routine issues and aircraft maintenance follows very strict procedures which necessitate repairs or replacement of parts before the aircraft is cleared to fly. Unfortunately, in this case we suffered a number of groundings at the same time,” it said. Some delays and cancellations continued thereafter. The airline has 24 narrow and wide body aircraft, some of which are not in service for technical reasons.
The airline has been suffering heavy carry-forward losses in the midst of showing operating profits with SriLankan Airlines CEO Richard Nuttall saying recently that the airline posted a profit of $3 million in the past 12 months. According to its last-issued 2021-2022 annual report, the airline’s carry-forward loss for the year was Rs. 163 billion.
According to Mr. Nuttal, the airline is aiming to recruit 80 new pilots as they face an alarming reduction in required personnel to man its fleet.
He told the media recently that the airline plans to hire 30 pilots this year and another 50 by mid next year to fill the gaps in its pilot cadre.
It has lost about 50-60 pilots within the past 10-12 months, with pilots joining overseas airlines. “In a worst case scenario, the airline may have to cancel flights as well if the pilot vacancies are not filled,” he said.
The airline’s other business – ground handling and catering – were also affected by the economic crisis and large-scale public protests last year.
During a meeting this week chaired by Minister of Ports and Aviation Nimal Siripala de Silva, it was revealed that the airline incurred $6 million in losses due to flight delays. SriLankan Airlines management and all affiliated trade union representatives at the Ministry of Ports, Shipping and Aviation attended the meeting.
During the discussion, the representatives of the engineers’ trade unions stated that the recent flight delays were caused by technical failures in several aircraft. However, the authorities of SriLankan Airlines have claimed that this situation arose as a result of certain trade union actions.
The Aviation Minister said that the airline has to pay back loans amounting to a total of $1.2 billion as well as their interest.
In a related issue, the country is also facing a severe shortage of air traffic controllers with many going abroad after securing jobs to escape acute economic conditions at home.
Amidst the crisis, the restructuring process of the national carrier continues with the government on the look-out for partners, offering a 49 per cent stake to private investors in this process with expectations to raise $500-600 million from the sale of the two subsidiaries (catering and ground handling) and more from the sale of the airline.
While no bids have been called so far, local media has said an Indian air operator has shown interest in investing in the national carrier. Officials involved in the restructuring process say this work would take more than a couple of months (calling for bids and eventual selection of a partner).
Bringing in a foreign partner would be the third time the airline is doing so after Singapore Airlines in 1979 offered its expertise to run the airline followed by the Emirates partnership.
As I wound up my column, sipping my second mug of tea brought by Kussi Amma Sera, my thoughts were on the plight of unskilled migrant workers who depend on scheduled flights to take them to the country of work, and also tourist arrivals.
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