Leaving behind talks of the past glory of the monopoly era, PIA still has two most enviable assets i.e. World Routes and Name recognition.
Little known reasons for the downfall
The back-breaking causes of fall, apart from four lethal air crashes during the last 30 years that include Kathmandu A-300, Multan Fokker, Havelian ATR-42 and Karachi A-320, another list of five completely scrapped aircraft during last 10 years includes, BHJ (ATR-42) aircraft landed off the runway during cross-wind landing at Lahore and declared scrapped, BHP (ATR) skidded off the runway at Gilgit and scrapped, and BKW (bigger version ATR of 72 seats) became out of control of Engineering personnel during Engine Testing and scrapped.
Strangely, one BHN (ATR-42) aircraft has been dismantled to provide parts to other aircraft due to shortage of parts owing to procurement procedures intricacies. For imagining the loss, a smaller ATR-42’s market price is around 15 Million US$ and an ATR-72 price is around 25 Million US$.
Further, 98% of PIA Aircraft Engineers are Not Graduate Engineers. They are Apprentice Mechanics who got certifications through technical courses and recognized by Civil Aviation as aircraft engineers. 75% of employees have got their children employed in PIA. Even, a few have got all of their children employed in PIA.
In 2009/10, 100 fresh diploma holders were employed as senior technicians who have never been provided Apprentice Training. In the past, PIA used to get selected young cadets through competition and send them to PAF Risalpur to become aeronautical engineer.
This practice must be started and agreement be made with the likes of Air University Islamabad and PAF institution at Korangi Creek Karachi so that graduate engineers to apprentice mechanic engineers ratio should be like 20:80 or 70:30. It’s about safety of the nation.
The biggest loss to PIA is that high yield ethnic Pakistanis of North America and Europe have started travelling by Gulf airlines and biggest advantage PIA has is direct flight option
Its time to recognize the irreparable damage by prolonged confines of Public Procurement Rules since 2004 that proved to be 2nd nationalization and broke the backbone of the spirit of sourcing and supplies and wreaked havoc with the serviceability of aircraft, airport equipment and onboard supplies.
These rules have limited the supplier numbers and have given the selected ones so much of leverage, they go and seek stay orders at will and hardly leave PIA. These rules should be simplified to the extent of open bidding and sufficient Bidding Time by amending PIAC Act and nothing more. In the interim, the purchasing department must be de-centralized into engineering purchase, catering purchase and airport handling purchase for prioritized supplies.
Revenue streams within PIA
To offset revenue loss due to open sky policy, PIA should be declared the sole ground handler like Dnata in Dubai. This business is worth US$30 to 40 Millions currently shared by 3 other private companies including one belonging to a previous govt aviation advisor.
A 350 plus room hotel owned by PIA at Karachi Airport be given a General Manager from 5 stars hotel industry instead of a discarded executive from airline head office. Due to hotel’s big spread, more than ample parking space and safe vicinity, arrangements may be signed with Trading Development Corporation of Pakistan for this property to be used as an alternative venue to EXPO Exhibition Centre.
Two more setups with a mammoth potential of earning foreign reserve are the Aircraft maintenance setup and two Pilot Training Simulators for the training of B-777 and B-747 crew are required to be run commercially by catching other airlines business through highly competitive commercial executives to be based in its actual market, Dubai.
A revenue-maximizing reservation system is available for passengers version only while every inch of aircraft Cargo hold also needs to be exhausted fully by having revenue management system for cargo also. Further, both systems required to be operated on their own with zero human interruption to avoid revenue loss and fraud.
Non-core business includes Airport Ground Handling, Airport Hotel, Catering Business, Engineering Services. While Airline core business be separated and called as PIA
The biggest loss to PIA is that high yield ethnic Pakistanis of North America and Europe have started travelling by Gulf airlines and biggest advantage PIA has is direct flight option. If one country is served with One Aircraft (OCOA), like aircraft ABC goes only to Germany, starting from Lahore to Frankfurt then returning Frankfurt to Islamabad, From Islamabad to Munich and then Munich to Karachi hence covering the whole of Germany. There may be thin traffic initially but definitely goes a long way to capitalize Insha Allah if persisted by the airline. And the same for Spain, France, Italy etc.
Catalysts to materialise
To materialize, two Catalysts are: amend the PIAC Act and make the HR as per market practice and secondly, the agenda of Daily Briefing Meeting must be Business and Not Operation only.
Separating core and non-core functions of PIA
To persevere following a fruitful conclusion, Non-Core functions be put under Foundation in line with Armed Forces Business Model and be called as PIA Foundation. The non-core business includes Airport Ground Handling, Airport Hotel, Catering Business, Engineering Services. While Airline core business is separated and called as PIA. The core business includes aircraft ownership, flight operations (Cockpit/Cabin Crew management), PIA Training Centre, Flight Simulator, Pax/Cargo Sales/Marketing and Only Small Supporting Admin/Finance. PIA Board is competent to approve this.
The writer is a former PIA official having 20 years of aviation experience in different departments of the airline including MIS, Ramp, Passenger Handling, Situation Room, HR, and staff duty etc. He can be reached at email@example.com. The views in this article are the author’s own and do not necessarily reflect the editorial policy of Global Village Space.