PIA BoD Approves Dry Lease of 12 Airliners in 2012

[Abbas Ali]

October 29, 2011 - According to Geo News, PIA Board of Directors (BoD) meeting has approved induction of 12 airliners on dry lease in PIA fleet in year 2012.

Details about aircraft types not provided by the news channel.

Hopefully details about required aircraft types will appear in tender notices that should be expected in newspapers in coming weeks/months.

These aircraft will be acquired by PIA with airline's own resources. PIA will neither seek financial assistance nor guarantees from Government of Pakistan for acquiring these aircraft.

PIA Business Plan also has been approved in this meeting. The Business Plan sees PIA as a profit making airline by the end of year 2013.

Abbas

[aviator007]

I think BOD are gone crazy, I believe A/C are leased on finances Does PIA have the finances, secondly they prepared their Business Plan and approved themselves.....

If they really want to turn around PIA the should first get rid of MRO Champion and hired a professional from out side so he will not be involved in RAT Race..

October 29, 2011 - According to Geo News, PIA Board of Directors (BoD) meeting has approved induction of 12 airliners on dry lease in PIA fleet in year 2012.

Details about aircraft types not provided by the news channel.

Hopefully details about required aircraft types will appear in tender notices that should be expected in newspapers in coming weeks/months.

These aircraft will be acquired by PIA with airline's own resources. PIA will neither seek financial assistance nor guarantees from Government of Pakistan for acquiring these aircraft.

PIA Business Plan also has been approved in this meeting. The Business Plan sees PIA as a profit making airline by the end of year 2013.

Abbas

[Abbas Ali]

Initially six narrowbody airliners (most likely Boeing 737 or Airbus A320) and four ATR 42 turboprops will be inducted in PIA fleet under three-year Business Plan 2011-14 approved by PIA Board of Directors, according to following news report on APP website.

Six Boeing 737-300s of PIA will be replaced under this plan.

PIA to induct 10 new aircraft in its fleet: NA told

ISLAMABAD, Nov 23 (APP): Parliamentary Secretary for Defence Azeem Daultana on Wednesday informed the National Assembly that the PIAC Board has approved three-year Business Plan 2011-14 under which six Boeing 737 airplanes would be replaced besides induction of six additional narrow body new generation and four ATR-42 aircraft into the aging fleet of national flag carrier.

Replying to various questions in Question Hour, he said that the Pakistan International Airlines Corporation (PIAC) had 39 aircraft, out of which 23 were very old. A comprehensive plan has been chalked out to overhaul the aircraft in a year, he added.

He said the PIAC would overhaul all these planes from its own resources and would not take any financial assistance from the national kitty.

To a supplementary question, he said that some aircraft were hired on lease from Greece for the Hajj Operation.

He said that the government had no intention to ban unions in the PIAC. A code of conduct has already been circulated to different unions and associations.Violation of this code of conduct would lead to disciplinary action under applicable law, he added.

To another question, Azeem Daultana said that the PIAC suffered Rs 78.19 million during the last year on account of cancellation of flights due to strikes and protests.

He said that a separate Cabin Maintenance Division was set up to improve cabin services in the planes.

Azeem said private airlines offer lucrative salaries, perks and privileges to their employees.

He said that during the financial year 2010, the corporation achieved its highest ever revenue in excess of Rs.107.5 billion as compared to Rs.95.5 billion in 2009 despite the volcanic eruption and strikes.

To a written reply, the House was informed that the accumulated losses of the PIAC stood at Rs.111.543 billion on September 30, 2011.

Source: APP

[TAC777]

Six narrow body aircrafts will be inducted to replace B737s as soon as possible.Probably they will be inducted before Summer 2012 schedule .(March 2012)

[Abbas Ali]

Is PIA leasing new or used narrowbody jetliners ?

ATR turboprops most likely will be brand new aircraft.

Hope they make some announcement in this regard after the end of post-Hajj flights operation on December 10 or give some advertisement for leasing/buying aircraft.

Abbas

[mustafahasan82]

I think the aircrafts most likely are a320s........ Even though palpa had suggested that pia goes for 737ngs

[Uzair Ansari]

My Sources says the same,They are going to A320's and some ATR's/Lets what they come up with.

[Amaad Lone]

A320 should be a natural choice, as the A321 should be acquired to replace the six leased A310s.

[haroon_ek]

A320 should be a natural choice, as the A321 should be acquired to replace the six leased A310s.

Amaad you say this, but just asking a question that would it be feasible for PIA to replace the A310s with A321/A320?

PIA has been using A310s for non-stop routes to European destinations e.g Germany, UK etc, whereas using A321 aircraft, it would be impossible to do non-stop journey without a fuel-stop like AirBlue does for Manchester flights.

If PIA has to go for different type of aircraft than current fleet, I only think that A330 would be best.

However, I would like to also hear from experts and current employees of PIA about A330 induction if it is feasible or not.

[Amaad Lone]

A320 should be a natural choice, as the A321 should be acquired to replace the six leased A310s.

PIA uses its six "LEASED" A310-324s extensively on routes to UAE, Middle East and dometic trunk routes.

While for Europe it mostly uses its own six GE powered A310-308s.

The leased A310-324s carry between 184-192 passengers, and with no sign of PIA passenger traffic expanding or growing, I would suggest to the "PIA experts" to keep a similar capacity aircraft on these routes, and that is going to be the A321-200.

The A330-200 carries around 275 passengers, and would cost a whole lot more to lease/buy and operate.

So why carry 180 passengers to to Dubai, Abu Dhabi, Dhaka or Kuwait in an A330 when the same job can be done much cheaper in an A321.

This is obviously if the airline goes for the A320 first.

[Aer Pakistan]

WEL SAID Amaad
i think PIA should go for A320/321 or B737-900 for national, regional, middleasten routes, and they should pull out B777';s from short haul flights like RUH,DXB, DAH, BOM. if PIA going to have 10 of these narrow body aircarfts in fleet would make difference. plus i think PIA should operates into europe with two cities per flights i.e example ISB-FRA-BRU-ISB, PAK-CDG-LHR-PAK, PAK-ROM-BCN-PAK, ISB-OSL-CPH-ISB, only ISB-LHR-ISB and ISB-MAN-ISB should be direct flights. so PIA can use more B777 into Euro with more flights per week.

[saadm80]

Personally PIA should go for A319/320. Mostly 320s would be suitable.

[Abbas Ali]

PIA advertisement that appeared in December 4 newspaper.

Pakistan International Airlines (PIA) invites “Sealed Bids” from interested parties for dry lease of narrow body jet aircraft.

* Number & schedule of deliveries. As specified in the bidding document.

* Aircraft type. Narrow body jet aircraft of identical type, make and configuration.

* Passenger seating capacity: Around 140

* Condition: New for all aircraft delivered after 2013. Aircraft delivered in 2012 and 2013 should preferably be new. However aircraft manufactured after 2007 are also acceptable.

* Lease period: 10 years with option to purchase or return any time after five years, at six months’ notice.



Abbas

[Abbas Ali]

Five-year plan for PIA aims to double revenues

* Reduction in operational cost by Rs 14.22bn under the plan

* Replacement of 40% national carrier’s fleet with addition of 10 new aircrafts also included

By Sajid Chaudhry

ISLAMABAD: Five year business plan of the Pakistan International Airlines (PIA) aims at doubling of the airlines revenues in five year period, reduction in operational cost by Rs 14.22 billion, replacement of 40 percent of national carrier’s fleet with addition of 10 new aircrafts and replacement of 6 existing aircrafts.

According to the official details of Ministry of Defence provided to the parliament, government of Pakistan (GoP), is examining a five-year business plan prepared by PIAC duly approved by their Board of Directors on the direction of Ministry of Defence and Ministry of Finance.

PIA does not incur any non-development costs but have direct (cost of services) and indirect costs (distribution, administrative and others) relating to operations. To control the indirect costs and to improve the financial health of the corporation, government of Pakistan, is examining a five-year business plan prepared by PIAC duly approved by their Board of Directors on the direction of Ministry of Defence and Ministry of Finance.

Salient of the plan are to strengthen culture of ethics and compliance, aggressive marketing plans for revenue enhancement, doubling revenues in 5 years, operational restructuring to cut costs and improve efficiencies, resulting in savings of Rs 14.22 billion which is 5 percent of the controllable cost, replacement and expansion of the fleet (10 additions, 06 replacements, 40 percent of present fleet), recapitalisation to pay for legacy losses. PIA is confident that these strategies combined with the support of the GoP will put the airline on path of profitability and return PIA to its past glory.

The total income of the national carrier Pakistan International airlines stood at Rs 133.66 billion during 2010 and January-March period of 2011, July-March period of the last fiscal year 201-11 compared with expenditure of Rs 147.091 billion in the said period showing an income shortfall of Rs 13.431 billion.

Incomes: Income from passenger was Rs 87.212 billion in 2010 and Rs 23.198 billion in first quarter of the ongoing fiscal year 2011, making a total of Rs 110.41 billion in three quarters of the last fiscal year 2010-11 (July-March 2010-11). Revenues from Hajj have been estimated at Rs 8.531 billion in 2010. Incomes from excess baggage were Rs 1.072 billion in 2010 and Rs 290 million in first quarter of the year 2011.

Total incomes from freight income have been recorded at Rs 6.406 billion during 2010 and Rs 1.390 billion during the first quarter of the 2011. Air lifting of mail and post has enable the national carrier to bag Rs 440 million during 2010 and Rs 102 million during fist quarter of the 2011. National carriers has earned Rs 461 million from aircraft charters (Passenger, Cargo) during 2010 and this has earned Rs 477 million to it in first quarter of the year 2011. By rendering engineering services to other airlines national carrier has earned Rs 1.250 billion in 2010 and Rs 222 million in first quarter of the year 2011. Other revenues of the national carrier were Rs 2.161 billion in 2010 and Rs 504 million in first quarter 2011.

Expenditure: Total expenditures of PIA during 2010 and first quarter of the year 2011 were Rs 147.091 billion. The cost of Fuel and Oil born by the national carrier during the said period was Rs 44.707 billion in 2010 and Rs 13.107 in first quarter of the year 2011.

Passenger Services expenses amounted to Rs 3.694 billion in the 2010 and Rs 936 million in first quarter of the year 2011. Aeronautical, Landing, Handling charges that have been paid by the national carrier were Rs 10.422 billion in 2010 and Rs 3.139 billion in first quarter of the year 2011. Maintenance cost born by the national carrier amounted to Rs 6.796 billion in 2010 and Rs 1.679 billion in first quarter of year 2011. General and Administrative expenses were recorded during 2010 at Rs 5.243 billion and Rs 1.472 billion during first quarter of the year 2011.

Depreciation cost born by the national carrier estimated at Rs 6.214 billion in 2010 and Rs 1.473 billion in 2011. Employee pay, allowances and other benefits have put a financial burden of Rs 18.569 billion in 2010 and Rs 4.382 billion during first quarter 2011.

IS and Communication services cost born by the airlines stood at Rs 1.469 billion in 2010 and Rs 497 million in first quarter of year 2011. PIA spent on advertising services Rs 782 million in 2010 and Rs 218 million in first quarter of year 2011. Expenses on GDS were Rs 1.555 billion in 2010 and Rs 307 million in first quarter of year 2011. Finance Cost was recorded at Rs 9.300 billion in 2010 and Rs 2.393 billion in first quarter of year 2011.

Exchange rate losses were Rs 2.092 billion during 2010 and Rs 734 million in first quarter of the year 2011. Other expenses of PIA were Rs 6.039 billion during 2010 and Rs 1.341 billion during first quarter of year 2011.

Source: Daily Times

[Abbas Ali]

A total of 39 narrowbody jet aircraft will be acquired on dry lease by PIA between 2012 and 2020, according to details in bidding document available on official website of PIA.

Here's planned delivery schedule for dry leased aircraft:

Time Period 2012-2013
Aircraft condition: New or used manufactured after 2007
Five in April 2012 and one every month starting from May 2012 up to Dec 2013.
Number of Additional Aircraft: 25*

Time Period 2014-2016
Aircraft condition: New
Number of Additional Aircraft: 6
Two each year

Time Period 2017
Aircraft condition: New
Number of Additional Aircraft: 2
Number of Replacement Aircraft: 7
Nine aircraft (Seven as replacement for aircraft delivered in 2012-2013)

Time Period 2018-2020
Aircraft condition: New
Number of Additional Aircraft: 6
Number of Replacement Aircraft: 18 aircraft - Eight each year (six as replacement for aircraft delivered in 2012-2013)

*Aircraft delivered before 2017 will be replaced one by one by the latest model new aircraft @ minimum six each year so as to replace all the aircraft delivered up to 2016 by new technology aircraft by 2021. If new technology aircraft are available earlier, replacement plan shall be altered accordingly.

In case the bidders cannot offer the aircraft required during 2012-2013 in required condition as per above delivery schedule, PIA can consider an interim substitution of up to ten years old aircraft of similar type to be swapped later with required aircraft within 18 months.

PIA shall prefer those bids that have Trade-Off option of six (6) PIA Boeing 737-300 aircraft, three each against deliveries in 3rd and 4th quarter of 2012 (Specifications of PIA’s Boeing 737 airplanes to be traded off on “as is where is” basis can be obtained from Director Procurement & Logistics Office).

Aircraft Configuration

Seating Capacity 12 Business Class and Remaining Economy

Class Divider (soft/moving) partition with rails up to first 6 rows in

Economy Class Seat Pitch Minimum 40” in Business Class and 31” in Economy Class (for old Seats) 30” in Economy Class (for Trim Seats)

Lavatories Minimum 3
Coat Closet Forward
In-Flight Entertainment (IFE)

* Business Class – In seat Video (ISV) 10” screen
* Economy - Drop down 14” screen at the most after every 10 rows

Cabin Attendant Seats 7
Cargo Compartment Ventilation and temperature control in
forward or aft compartment

Source: PIA - Tender Notices