The Pakistan International Airlines, once one of the most profitable institutions of the country, has been hit by a series of wrong decisions and mismanagement.
PIA employees' unions have made it clear to the management that they would not extend their services for these leased aircraft. A union spokesman, confirming the decision following a meeting, said that the Corporation is always criticised for being over-employed while the management keeps on taking aircraft on wet lease.
This means that another around 100 crew members would be on PIA's payroll to fly the leased aircraft like the ones from Hellinic Airways.
He said that, on average, seven aircraft of PIA fleet are stranded in hangars for want of spares. Instead of arranging spares for these aircraft, the management is taking more financial burden through these decisions.
PIA flights, whether domestic or international, due to mismanagement of coordinators of the leased aircraft, more often than not, are late by six hours, as a normal routine, and hundreds of passengers get stranded on airports.
Even the Dubai airport management has issued a warning to PIA, following passengers' protest against delayed flights and non-availability of luggage in their flights at Dubai airport.
"National flag carrier's management has absolutely no clue of how to manage an airline with a fleet of 39 aircraft and more than 100 flights a day as they themselves are marred by corruption, nepotism, inefficiency and severe mismanagement of all kinds," according to unions' representatives.
They said that earlier PIA had entered into a dubious deal with Hellinic Airways for lease of two Boeing 747-200, while its own 747-300 are parked in the hangars for want of spares. Strangely enough, while keeping two of its own Boeing 747 of much latest series '300' on ground, PIA management struck a deal, spending millions of dollars for two Boeing 747 of older '200' series.
It is learnt that the 6 RB 211-524 engines of stranded Boeing 747-300 were sent to JALCO in Amman, Jordan, for overhauling--a routine matter--while the company had been requesting for payments of overhauling of engines done for Hajj operations 2010.
On an average, $ 0.5 to $0.8 million are charged for overhauling, depending on the condition of engines. Previously, 747-300 engines were sent to Hong Kong for overhaul through a contractor called HAESL, but PIA went into litigation with the company on the issue of over-charging, etc.
According to experts, much less amount would have been needed if the management had asked for timely overhaul of engines, which are more fuel-efficient than leased '200s', and nothing extra, like daily allowance to crew, hotels, and lease money, etc would have been paid.
The swiftness of current management, which is facing severe shortage of aircraft and needs to act quickly in a cost-effective manner, could be judged by an internal Memo which was moved in December 2010 by Engineering Department to request clearance of dues of JALCO from previous Hajj operations so that Hajj operations could be planned well in time. The Memo was responded by managing director's office only in June 2011.
As per agreement, PIA was supposed to pay $ 1.1 million on the start date of operations, as advance payment. PIA shall pay another $ 400,000 on start date and $ 500,000 at start of post-Hajj operations. Reconciliation and payment shall be made within 30 days, after the operations, after adjustment of the maintenance cost of work already performed by PIA on the leased aircraft.
PIA was due to pay $ 1.125 million as advance for minimum guaranteed block hours against SX-TIE aircraft on receiving CACA clearance from Saudi Arabia and an additional amount of $ 1.125 million as advance payment for minimum guaranteed block hour after 15 days of start of operations.
PIA was to pay approximately $ 10-12 million to Hellinic Airways for two aircraft as rental, while it could have had at least 8-10 engines overhauled against the same amount.
It is puzzling, indeed, that despite having a $ 700 million credit line available through another deal, though equally dubious, with Transworld Aviation for supply of spares, PIA still had to look for options other than having its own aircraft repaired.
The Society of Aircraft Engineers of Pakistan (SAEP) of PIA had expressed grave concern on awarding the contract to Transworld Aviation FZE, a Dubai-based US firm, which lacks the qualifications and expertise to carry out the assigned task.
It had pointed out that Transworld Aviation FZE has no experience in dealing with commercial airlines. Moreover, as required under the tender issued in this regard, Transworld refused to submit its annual accounts, which automatically disqualified it from participation in the tender.
