Can PIA fly through tough times?

By
anjum
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On a recent Pakistan International Airlines (PIA) flight, water flowed from the toilets through the aisles during the entire journey from London to Islamabad. “What if it reaches some electrical wires and puts us in danger?” said one concerned passenger to another after flight attendants brushed off repeated complaints. “This could be a catastrophe.” PIA, like Pakistan, always seems to be on the brink of disaster. But now that seems closer than ever for the national flag carrier, once a source of pride for the country.
The airline is haemorrhaging hundreds of millions of dollars a year while being pummelled by competition from sleek Gulf giants like Emirates, Etihad and Qatar Airways. A quarter of its 40 aircraft are grounded because the airline can’t find enough money to buy spare parts. Flights are regularly cancelled and engineers say they are having to cannibalise some planes to keep others flying.
“The situation has worsened to the extent of rendering this airline almost financially unviable,” said the State Bank of Pakistan in a report on the state of the economy.
PIA lost Rs 19.29 billion ($212.7 million) in the first nine months of 2011, almost double the losses in the same period in 2010. The airline, like the Pakistani economy, has relied on bailouts to stay in the air, and is negotiating with the state for another rescue package.
“Just like PIA has the potential to do well, Pakistan’s economy does too. But both haven’t because of mismanagement. In the end that is the story — mismanagement,” Salman Shah, Pakistan’s former finance minister, told Reuters. PIA officials were not available for comment on the challenges facing the airline despite repeated requests.
Overloaded: Over the years, critics say, governments have manipulated state corporations like PIA for political and financial gain, giving jobs to so many supporters that the size of the workforce has become unsustainable in the face of mounting losses. “We don’t have people in the right places in typical Pakistani fashion. It’s about who you know, not what you can do,” said a PIA pilot, who like other employees asked not to be identified for fear of being fired.
“Politically motivated inductions have been the major cause of the significant increase in human resource burden in this organisation,” said the central bank. “It cannot be corrected without taking drastic steps for rightsizing and increasing operational efficiency.”

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