Pakistan International Airlines laid a proposal plan according to which it will be restructuring. The airline will slash half of its workforce, cut unprofitable routes, and replacement of its fleet. PIA intends to become a leaner and efficient airline by 2023. It appears to be a revival plan.
Restructure Plan of PIA
The Pakistani Cabinet has approved the proposal of PIA. The 14,000 employed individuals working for the carrier will be cut out to half. The rotation in PIA includes a cut of long-haul routes, which brought loss to it. There will further be no expansion in the fleet. PIA operates a fleet of 27 aircraft.
Moreover, the prime minister’s advisor commended that the state plans to outsource the management contract of PIA. Or sell a 26% stake in the airline after improvement in the balance sheet. The restructuring plan is to overcome the loss in revenues from the past.
Also Read: Reviving PIA with Restructuring (Part 2)
Challenges met by PIA
PIA is the national flag carrier of Pakistan. Due to various reasons, it had been facing a visible downfall. In the year 2020, PIA endured a loss worth 35.5 billion. Particularly, the pandemic served a major role in the deprivation of the airline. Most of the countries imposed a ban on carrier’s entry due to Covid-19.
The airline is stagnant in terms of success and a struggling position. Previously, the hindrance in approval of the revival plan was due to the protests by employees. The adamant interference of political bodies was another obvious reason for the denial of the plan. Now, the carrier is coherent about its revival.
PIA is operating a fleet of three types of aircraft with an average fleet age of 14.7 years. It will turn into a leaner fleet. The state is planning to make PIA profitable by 2023. The flag carrier airline is ready to step up as an efficient organization.
“This time there are no grandiose plans to become like Etihad or Emirates or Qatar.”Dr. Ishrat Hussain, the prime minister’s advisor, said,
PIA aims to show excellence in its operations. The future goal is to focus only on its own performance.