PIA 1 and PIA 2

[Amaad Lone]

PIA is the state owned airline of a country that is going through a financial nightmare.

Pakistan added 1.2 trillion rupee debt in the month of July with total government debt reaching 33,000 billion rupees.

Pakistani tax revenue is very low and the ratio of interest payments is very high and after paying the provinces 2.3 trillion rupees the government is not left with enough money to cover defense or interest payments.

In such a scenario do you think PIA should be getting 40 billion a year handouts. Just to save 15000 jobs. How much is each job worth???

The government immediately needs to do what Nawaz Sharif planned but could not do. PIA1 and PIA 2.

Move most loans and liabilities to PIA 1 and keep PIA 2 as the healthy airline with like 6-7000 employees and the fleet plus routes.

Sell the two hotels in Paris and New York to pay off as many loans and liabilities of PIA 1.

PIA 2 without any previous loans and liabilities should be able to survive on its own with out government bailouts.

Nawaz Sharif had a good idea dont know why he did not do it.

[fahadshakeel]

NS had this idea but his political aids within Aviation weren't in favour of doing this. We all know why.

They molested the original idea towards PIA Premiere Service and hoped to expand this service in the future. 5 or 8 Dreamliners were in ordering phase but a wet-leased srilankan aircraft was a mistake which eventually fired back in terms of losses.

I wish if NS could have waited a while and stood firm on acquiring 787s to start this service instead of short-term acquisition. Because a brand new company can't be run only on motivations & hopes. It needs more & improved assets along services to keep the company in profit from day1.

I am not 100% sure but on the same forum as well as in a casual meetup with few PIA officials; I came to know that PIA premiere is just a start, later all profit-making routes will come under PIA Premiere over new mid-wide body aircrafts. All existing aircrafts will serve PIA with major domestic, religious operations as well as low-profit routes.

I still believe this wasn't an excellent solution because starting a new airline with new assets but probably shared officials could've led to more turbulence. The only & viable solution was to review the aviation policies, negotiate & then freeze the outstandings on govt guarantee and then improve service. Keep the outstandings frozen until it comes to profitability and then schedule the payments. I know it's not near to impossible but possible.

[amjid84]

PIA is the state owned airline of a country that is going through a financial nightmare.

Pakistan added 1.2 trillion rupee debt in the month of July with total government debt reaching 33,000 billion rupees.

Pakistani tax revenue is very low and the ratio of interest payments is very high and after paying the provinces 2.3 trillion rupees the government is not left with enough money to cover defense or interest payments.

In such a scenario do you think PIA should be getting 40 billion a year handouts. Just to save 15000 jobs. How much is each job worth???

The government immediately needs to do what Nawaz Sharif planned but could not do. PIA1 and PIA 2.

Move most loans and liabilities to PIA 1 and keep PIA 2 as the healthy airline with like 6-7000 employees and the fleet plus routes.

Sell the two hotels in Paris and New York to pay off as many loans and liabilities of PIA 1.

PIA 2 without any previous loans and liabilities should be able to survive on its own with out government bailouts.

Nawaz Sharif had a good idea dont know why he did not do it.

I dont agree to selling the hotels - these make money for the airline.

What needs to happen is PIA be declared bankrupt - payout all employee entitlements and start fresh. They need newer aircraft. Q400 / ATR & A320s for domestic; with the A320's for middle-east routes as well. A330's for Asia and some Europe routes, whilst B787 or B777 for UK; USA & CAD routes. Obviously using larger aircraft for Hajj trips when required.

PIA need to upgrade their IFE and their website - also scheduling of flights, so that connections can be made as away of enticing transit passengers. At the moment there is no co-ordination of flights and even when booking on the website, it comes up with some random flights. An example being LHE-NRT (via KHI with stop of 20hrs+; ISB 15hrs+, then taking the ISB-PEK-NRT flight).

They need to hire someone with Commercial Business experience, particularly in Aviation.

I wouldn't mind seeing QR / EK or EY take a stake and operate as a domestic carrier - whilst feeding all flights to DOH/AUH/DXB and then onward connections on their respective metal.

[Amaad Lone]

I dont agree to selling the hotels - these make money for the airline.

yes the two hotels make money but how much money???? If the hotels make 20 million dollars in profit that is 3.2 billion rupees. Now the hotels are worth 200 billion so what is the rate of return on investment. PIA on loans of 200 billion are paying 24 billion in interest. Now look at the difference PIA is earing 3.2 billion but spending 24 billion on interest payments a difference of 21 billion. PIA can save 21 billion a year if the hotels are sold and loans paid off.

What needs to happen is PIA be declared bankrupt - payout all employee entitlements and start fresh. They need newer aircraft. Q400 / ATR & A320s for domestic; with the A320's for middle-east routes as well. A330's for Asia and some Europe routes, whilst B787 or B777 for UK; USA & CAD routes. Obviously using larger aircraft for Hajj trips when required.

PIA cannot start a fresh start, the government of Pakistan has given sovereign guarantees to banks for around 220 billion, that government has to pay whether PIA is there or not.

Either shut down PIA or sell the hotels and invest that money in PIA. Those hotels are giving PIA nothing.