25 May, 2019

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A Way Out For SriLankan Airlines

By Sarath de Alwis

Sarath de Alwis

Sarath de Alwis

We cannot solve our problems with the same level of thinking that created them” – Albert Einstein

If the government is serious about rescinding the uneconomical and extravagant re fleeting program of SriLankan airlines, the solution is staring it in the face.

The response in parliament by the Prime Minister to a question by JVP MP Sunil Handunneththi on SriLankan Airlines is a sobering reminder that this government is yet to decide its aviation policy and what it plans to do with debt ridden national carrier.

It is also a disturbing forewarning that the government is yet to evolve its strategy for global connectivity in its grand design of the western province mega polis.

On the purchase of the eight Airbus 350 aircraft the Prime Minister has said ‘the government would have to decide whether to cancel the deal or go ahead with it. He has further amplified that 1.4 million dollars would have to be paid monthly if the government went ahead with the deal.

SriLankan AirlinesIn the interest of transparency, the government should table in parliament the precise financial implications of the re fleeting of SriLankan airlines. The accurate details of this massive transaction remains shrouded in official obfuscation.

It now seems that the purchase of the five Airbus A330 aircraft and the two A321 neo aircraft is a done deal. The official rethinking if any is confined to the eight A 350-900 aircraft.

The State Enterprises Development Minister Kabir Hashim is on record stating that the state owned carrier is making losses on its long-haul routes.

He is also on record insisting that “Though we have ordered (A350s), we do not need them. Addressing parliament in December last year he has said ‘we have to pay 50 million dollars to cancel the order’ and has quite correctly observed that ‘A350 production slots have some demand and it is not clear whether any attempt has been made to trade them.’”

When will the government stop the rhetoric and make way for serious introspection and decide on a feasible strategy on Sri Lanka’s future trajectory in commercial aviation? If the government is serious about an economic recovery, it has to get out of the airline business.

The new CEO of Sri Lankan airlines Captain Suren Ratwatte has recently told the press that the Airline was delaying the delivery of an order of eight A350-900 aircrafts from Airbus until its acute financial position is sorted out.

“In view of the financial situation, the delivery of the eight A350-900 aircrafts will take longer than planned” he told the Business Times on December 2015.

The Prime Minister’s use of the Sinhala aphorism ‘Gedera giyoth ambu nasi, maga hitiyoth tho nasi’ while picturesque is a tacit admission that his Global advisory committee headed by Charitha Ratwatte has not kept him advised on the developments in the Middle East.

His Advisory Committee and SriLankan Airlines seem oblivious to the developments in commercial aviation as a result of Iran emerging from the isolation of international sanctions. The President of Iran lost no time telling the world “The legs of Iran’s economy are now free of the chains of sanctions, and it’s time to build and grow.”

Iran officials have signed two agreements with Airbus covering new aircraft orders. These accords were inked at the Élysée Palace, Paris, during Iranian President Hassan Rouhani’s official visit to France with French President François Hollande.

Iran Air agreement with Airbus covers the acquisition of the full range of new Airbus airliners (73 wide bodies and 45 single aisle). The agreement for 118 new aircraft includes 21 A320ceo family, 24 A320neo family, 27 A330ceo family, 18 A330neo (-900), 16 A350-1000 and 12 A380. [Source www.Airbus.com Press Centre]

According to both Bloomberg and Reuter’s reports the Iranian demand for Airbus aircraft will place huge pressures on air craft delivery.

The Iranian purchases of Airbus aircraft is therefore, a fortuitous window of opportunity for Sri Lanka. The only irritant may be the inflight facilities requested by Sri Lankan on their new aircraft.
Despite its determination to play catch up, the two Iranian airlines are unlikely to get in to the inflight luxury game. Religious orthodoxy will be a fact of life in Iran for the foreseeable future. But they do need the aircraft in a hurry.

At the recent aviation summit held in Iran, attended by all major stake holders in the aviation industry, the Iranians made clear that their focus was on leasing not buying air craft.

In sharp contrast to the ‘Pie in the sky’ approach to Air craft modernization of SriLankan aviation professionals, the Iranian demand for new aircraft is based on sound commercial logic.

Los Angelis is also called Teherangelis ! An Iranian diaspora of nearly 1.5 million in North America are aching, yearning to travel on Iran air. Europe also has a huge Iranian diaspora.

The Prime Minster should talk to the Ambassador of Iran. We should offer them the eight A 350s we have ordered. It may then turn out to be possible to say ‘Gedera Giyoyth Ambuwa hina wei! “.

Mr. Thirukumar Nadesan is the local agent for Airbus Indusrtrie. They could not have found a better mover and shaker to represent them in Sri Lanka. A mover and a shaker is a person who initiates events and influences people. This mover and shaker, certainly initiated events in the early morning hours of January 8th 2015.

The previous government may have entered in to an extravagant and unrealistic commitment. That is no excuse for the present management of SriLankan Airlines to go on the same reckless path. Opportunity is usually disguised as an insoluble problem.

Don’t throw good money after bad’ is a basic rule that successive governments have ignored. The problem with this government is understandable. The decision making Brahmins at its core are those associated with failed policies of the past. They are mired in the ‘sunk cost’ fallacies. So they ignore the basic rule that precludes taking to account irrevocable ‘sunk’ costs when making investments for the future.

If we continue to throw good money after bad, we may reach a point when we have to scream ‘Mehema Giyoth Ratama Nasi.’

 

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Latest comments

  • 18
    1

    It will cost $12 million to cancel the contract. Rajapske would not have signed the contract unless there was a sizable commission involved.

    These things must take a while to come off the production line. Perhaps the position in the queue can be traded with another buyer who cannot wait.

    • 4
      0

      Sarath de Alwis

      “On the purchase of the eight Airbus 350 aircraft the Prime Minister has said ‘the government would have to decide whether to cancel the deal or go ahead with it. He has further amplified that 1.4 million dollars would have to be paid monthly if the government went ahead with the deal.”

      $1,400,000 monthly.

      Assume they make $100 Gross Margin per seat.

      =$1,400,000/100 = 14,000 seats/month = 467 seats/day
      Say 20 Flights/day = 23 seats/flight.

      This is purely a business ad marketing decision based on the travel opportunity.

      That certainly need good managers, marketing people and promoters.

      Do they have them? Is Sri Lankan Airlines still loaded with incompetents?

    • 6
      0

      Sri Lankan has no future in Europe. The tour operators are selfish and is not allowing cancellation of Paris and Frankfurt. We are losing big time on these sectors.

      Beleive it or not !!! We have never made any money on passenger traffic since Emirates left us. Passenger traffic is a losing money every day. The only profitable areas are catering and ground handling since we are over charging and no competition. If you allow competition in these two areas, they will be loss making as well.

      Sri Lankan has been always used by politicians for their buddies to have fun inside the board room and outside.

      We need to keep Sri Lankan afloat to keep prices affordable. However it should be limited to Middle East, South India and East Asia.

      A few suggestions:

      Reduce staff since we have almost 80-100 staff per aircraft
      Close European routes
      Separate cargo and ground handling from passenger operations
      Professionalise the management
      Enter into a JV with a middle Eastern carrier
      Look at yields and load factors
      Review re fleeting plans

    • 0
      0

      Airbus is a European company they have strict rules when do business, They cannot offer bribes to anyone?
      Without iota of evidence it is shameful you accuse MR like you know everything!

      I am eagerly waiting until Mangala Samaraweera brings the 16 billion to our coffins!

      Their must be strict punishment for slander if you accuse people without any facts! Freedom of expression is one thing but slandering is another.

      • 0
        0

        Srinath, the most naivest MR appologist but living in London – please wait you will see it by your eyes sooner than later how devious, abusive, malicious MR has really been. Not many including his family are aware of his real colours. He is the most abusive lanken senior politician in the country. All investigations will prove his reality soon. That is crystal clear to me. Please be patient. We have waited long.. but lot more to wait… turth will come to surface soon.

      • 0
        0

        @srinath.gunaratne

        “Airbus is a European company they have strict rules when do business, They cannot offer bribes to anyone”

        Beg to differ. Look for “Airbus Affair” on Wikipedia. They are not the only ones. Lockheed, BAE Systems and others have sweetened the pot for potential purchasers

  • 8
    0

    Are you suggesting the man to go next door.( IRAN)Then both Husband and wife are safe
    and next door man will NASI.Iran will negotiate a better deal with Airbus as they do not need Commission

  • 9
    0

    I think it’s too late.. I have heard rumors that UL’s first 350 is already on the assembly line. there have been instances like Japan’s Skymark Airlines being unable to pay for their 380’s resulting in them idling in Toulouse. Sri Lankan cannot survive the longhaul market with 5 330-300s. Their 330-200’s made in 2000 will slowly be phased out within the next 5 years.

    UL also wastes longhauls on short route like Chennai and Male making them lose their number of cycles. US carriers use aircraft which are way into their 20’s because they are only used on longhaul sectors.

  • 4
    1

    The savings for the airline should come not from scrapping these aircraft purchases, but from streamlining its existing operating processes. There are long-term savings to be had from these more fuel-efficient aircraft that are not considered in this article. Trade-in benefits from the existing fleet are also not considered. Also, it is not particularly difficult to dispose of the A350 that is a model in demand should things not work out after a couple of years. The focus should be on fixing the actual elephant in the room that are the ground operations and inefficiencies that are bleeding funds, not going after the potential cash cow.

  • 4
    0

    The only way to erase the huge multi billion dollar public debt that resulted from atrocious “local” management of the national carrier that poor Sri Lankans are paying off in taxes on consumables, is for the present regime to resort to extravagances like 500 member retinues on state visits by its leaders (including extended family on shopping sprees in Dubai or Hong Kong)and free rides for ministers and their large contingents at the expense of ordinary travellers’ bookings.

    That way, the airline can soon be written off as a bad debt and all its assets can then be auctioned by the IMF or World Bank.

  • 3
    2

    We can buy and lease out the aircrafts to the Iranians, no ?

    Nadesan will be happy. Rajapaksa will be happy. Srilankan will be happy and the Govt will be happy too.

    A Win-Win-Win-Win situ.

    • 0
      0

      hi

      maybe you dont know how airline orders work
      theyre configured to your customisations which will be different to other airlines preferences.

      so unless the Iranians fly the same configuration they cant accept them

  • 7
    2

    Instead of debating whether we should buy new airplanes or not, it is much more sensible for the GoSL to sell off or shut down Sri Lankan and retain the two profitable divisions of it catering and the training school.

    President Rajapakse kicked Emirates out because they would not give him 30 business class tickets on short notice in the middle of the December holiday travel season after he had gone for the graduation of Yoshitha from some military academy in England. That insane decision has cost the taxpayer billions of rupees since 2008 when Emirates left.

    There is no war on, so there is no need for a national carrier since Colombo is served by so many airlines. Additionally, Sri Lankan is a bloated, ineffective organization full of unmotivated, unimaginative people. If Sri Lankan is shut down, most of the good people will be able to find jobs with overseas carriers on short notice since the global airplane travel market is going to double between 2015 and 2030 according to all reliable predictions. Those people employed will become foreign exchange remmitters to Sri Lanka at much higher rates than those poor domestic workers. The useless fellows who can’t find jobs will be off the GoSL payroll and won’t continue to be a burden to the tax payer.

    So, shut Sri Lankan down other than for catering and the training school. This is not rocket science, but simple arithmetic. We have much more pressing problems to solve than trying to keep this puppy on life support anymore.

    PS: If the security guys are really concerned and pride is wounded, then buy Lokka a small business jet on a wet lease so he can do his international visits on our version of “Guwan Hamuda Eka!”

    • 2
      0

      Even the most tinpot dictatorship has a national airline, and we aren’t there yet. There are certain factors of stability you don’t just “shut down” at the drop of a hat. Rather, they should file for bankruptcy like far larger and more prestigious airlines have done, restructure the operation by culling the fat (most of the costs are in excess staff) and then reemerge, probably in a smaller form and with a JV. Few large airlines (except the middle eastern ones that often rely on sovereign wealth) are profitable- most barely break even. In their quest in chasing profitability, Sri Lankan has forgotten to first stem the loss. Instead of flying down harvard professors to fix our economy, which we can do ourselves, they should spend that money on specialist consultants to look at the airline. As long as it’s in the hands of politicos and board members without balls, nothing will happen.

  • 4
    0

    Didnt Emirates make money managing UL and give a share to the SL govt? Where did we go wrong in running this airline?

    • 0
      0

      Emirates deal web of corruption – UNP will disentangle it

      The main opposition UNP yesterday slammed the AirLanka-Emirates deal as one of the most scandalous national fraud and pledged it would disentangle the web of corruption and expose and bring to justice all parties who benefited from this corrupt transaction.

      In a hard-hitting statement, General Secretary Gamini Atukorale charged that the deal would turn the national carrier AirLanka into a virtual feeder service of Emirates airlines while it also provide for the unconscionable irony of giving a ten-year oil subsidy to a rich oil-producing state at a time when subsidies to the poor people of Sri Lanka are being reduced.

      The statement says:

      “On 5th April 1998 the Sri Lanka Government through a sudden press release announced that AirLanka would be embarking upon a US $550 million Airbus re-fleeting programme. As part of this exercise it was also stated that a one-sided agreement on consessional terms had been signed making Emirates the manager and strategic partner of Sri Lanka’s Flag Carrier, AirLanka.

      “Through this device the PA Government successfully by-passed all established Government Procurement and Tender Procedures and moved swiftly to purchase Airbus airplanes and related equipment which is ultimately expected to cost around US $700 Million.

      The UNP is now convinced that the so-called AirLanka restructuring had only one objective; namely obtaining illegal commissions from what is the largest single procurement made by the Sri Lanka Government in the last decade. What is even more scandalous about this transaction is that the avarice for these commissions was so great that the deal was structured so that the PA administration literally gave away our national asset and flag carrier, AirLanka, alongwith valuable international route rights to Emirates in order to achieve this unholy objective.

      “As a result of information now available in the public domain, it is obvious that the massive investment involved and the commissions that go with it will not only enrich the PA and its cronies but will also enable Emirates to recover up front their so called investment in AirLanka.

      “As an added bonus it appears that deal has enabled Emirates to avoid paying millions of dollars in cancellation penalties to Airbus by transferring their own surplus orders to AirLanka. In addition, Emirates, which is a competitor to AirLanka, will be in a position to cannibalize our national carrier and rationalize its route structure to its own advantage. This is demonstrated by the fact that the Airbus A-330 Aircraft, which has now been ordered, will impede AirLanka’s ability to serve the Indian market adequately and in the long term move AirLanka away from being an International Carrier and convert it into a feeder service for Emirates out of Dubai.

      http://www.sundaytimes.lk/980412/news3.html#4LABEL1

      What short memories they have over in the UNP.

  • 2
    0

    The current Govt. is in existence for well over one year and the Prime
    Minister says that the Govt. is yet to decide on the aviation policy.
    The air traffic growth has increased 10 fold since 9/11 and with peace in Sri Lanka and being a tourist destination, it is suggested, that instead of retreating, go forward, developing aviation industry in SL.

    We read in the media that there will be talks with one of the richest
    airlines in the middle east, Qatar Airways, soon, on taking over the
    running of Sri Lankan airlines and why not discuss at the same time as
    to whether they could foot the bill for the purchase of those eight airbuses in stages, if they finalise a long term agreement between the
    two airlines. This money is peanuts for them and Qatar airways will be ever willing to assist as they want to out beat the other airlines in the area by becoming a regional power in aviation in the middle east. There will be enough potential for tourist traffic into the country in the coming years. If the Govt. free travel, unnecessary diversions to
    pick up Govt. VVIPs and employment of incompetent staff are avoided,
    there will be considerable savings, to begin with. To remain competitive in airline business, airlines should operate new aircraft
    hence, we should have another try at the purchase of those airbuses.

    • 2
      0

      Its in the works. Perhaps why my3 flew qatar airways on his trip to germany. Surprised none of the sinhale folks have pointed that out. I guess they arent very smart.

  • 1
    1

    Sri Lankan Airlines should make use of Sri Lanka’s strategic location, i.e being half way between Australia and Europe. Singapore, Thai, Emirates and many other airlines carry passengers between Australia and Europe but in all these airlines you get one long-haul and one short-haul flight. As far as I know almost all flights in/out of Australia are flying at full capacity.

    • 2
      0

      Aruna,

      You suggestion would certainly have worked for UL if implemented as far back as late 80s as proposed by then CEO by the name John C Flemming.However sadly though the Politcal Masters did not have the wisdom to see the merit of such a proposal whilst it was more important for them to maintain the Airline as their personal property instead.

      What we missed out then ,late entrants such as Emirates.Qatar Airways and Ethihad have diligently followed with great success.

      I am afraid we simply have missed the Bus ( or the Plane) perhaps

  • 13
    0

    Why sell the aircrafts, sell the whole airline, and save the bleeding from the country’s coffers. The funds saved would be put to good use for the people of the country instead of wasting the poor tax payers’ money. In the end we might end up with a better Air Line for the country.

    When Margaret Thatcher came to power British Airways was bleeding from all sides and was making a big hole in the British treasury. What she did, she checked up with her think tank, they suggested her to install a top and hard hitting team with a high target, in a given time frame to either get it to profitability or to break even.

    When they hit the target, she sold it in the London Stock Exchange and brought in a huge and handsome figure for the British public.

    If you have the will, you always have the ways to do it.

    Emirates was started late eighties with two Boeing 737-400 leased from PIA. First destination was Karachi and second was Colombo. At that time I was a frequent traveler on Emirates, for long period practically all the flights were empty. Immediately after take off and meals were served, I go to the middle rows and put the hand-rests up and have a good nap until the landing.

    From the inception to date the Chairman is Sheikh Ahmed Al Maktoum, the uncle of the ruler of Dubai Sheikh Mohamed Bin Rashid Al Maktoum. From the first MD/CEO Maurice Flanagan to present Tim Clark are ex – British Airways personnel. There are people from over 200 countries working for it. Right now, it is the biggest international airlines in the world. Over 100,000 thousand people are directly working for it and indirectly many more. At present it has over 300 aircraft and every day they are getting one or two new ones.

    When he had the meeting to start the airline, Sheikh Mohamed told his officials, there were six million people flying above us but I want to bring them down to Dubai. Now from the day one, Emirates has carried over 200 millions passengers. It’s making a huge contribution in so many ways to the economy of Dubai.

    First time when I went to Dubai in 1974, it had only three main streets and the airport had only one terminal for both arrival and departure with one run way. Now it’s four terminals and two run ways. The new airport at Jebel Ali – Dubai World Central Airport is the world’s biggest with six run ways and several terminals. Dubai Airport has beaten London Heathrow for the last two consecutive years as the world’s numbers one busiest international airport.

    Why I mentioned, all the above is to put it to the head of our people, if you put it your mind and work at, it it all possible. How it possible for about 300,000 to 400,000 desert normad people to do all these who were riding the camel few years ago.

    One might say, it’s money because of oil, no, Dubai had little oil and producing 100,000 barrels a day in off shore, it was in 70s and 80s. Only Abu Dhabi has oil. Though it’s in Federation with other Emirates but not drawing any funds from the federal budget, in fact Dubai and Abu Dhabi are the only contributors to the federal budget for all the other emirates to spend.

    If one go to any office of the government department of Dubai, one could see the quotations of the ruler, the best one is – IF YOU TO WANT TO DREAM COME TO DUBAI. People from two hundred countries are living, doing business and working there.

    Main reason is Dubai is open and connected to the world by all possible ways – air, sea, telecom, cyber etc. Their people are open to the world and they grab the best.

    Once, I asked one local, why you people are selling thousands of properties, hundreds of towers and villas to foreigners, what he said amazed me – they wouldn’t carry those in their cases, it all stays in Dubai but we get their money, see how smart they are? In 2007/8 when the financial crisis hit the world, Dubai was over USD.100 billion in debt to the world but with that money they built every thing they need for hundred years.

    Why, Beckham, Shoe Marker, Tiger Wood, all the rich and celebrities are buying properties for USD 25, USD 50 million over, just plots filled in the sea and villas. It’s the life style they are offering. Not only celebrities and rich, thousands of normal people from all over the world have bought properties in Dubai, that includes hundreds of Sri Lankan as well.

    It has a stretch called Al Rigga Road, it’s smaller than Pettah and has over 250 four and three star hotels. Lot of our people are working in them.

    Dubai Mariner has eights thousand boats belong to the residents from all the world living in the Mariners Towers, there are hundreds of them belong to Sri Lakans. Also hundreds of Sri Lankans working in those boats as they need workers to care for them.

    All our politicians, officials, people and news media are all in negativity, and they don’t have the can do mentality and mind set, always fighting and arguing at unwanted and necessary things like race, language, religion etc. They are coozy and comfortable with what they have and don’t want go beyond that. We are over 20 million with some education, if we change our mind set and build up the can do attitude, definitely very soon Sri Lanka would on top of the world. Look at the world map and see, it’s in the center of the world. If we go for it, it would be in the center of world in all possible ways.

    What Dubai and Singapore offering for the residents, shopping and entertainment but Sri Lanka could offer culture, history, nature, sun and sea etc, which are no match for them. For normal person to see, feel and experience it all, it’s country in a suit case, where in world you have a country like this, in my years of traveling, all over the world I never, ever seen and yet to see such a country like mother Lanka but to the people to get the best, they should change, they must open far and wide about the world , can’t live like the frog in the well. We have to move with the world, if we are to have good life for all in the country.

    • 4
      0

      The British Airways story isnt as simple as you make it seem, and Thatcher’s role was somewhat limited. You should read up on it more. Take special note of their Dirty Tricks campaign, shortly after the entry of Ryanair and Virgin. They’re lucky that BA is still around today.

    • 2
      0

      James,

      no one would dispute the facts as indicated by you.But would it make any sense to RW and his government ? For him any organization including UL is only a means to provide jobs for his Royal cronies.

      Lets keep on Dreaming

  • 5
    1

    Do we need an airline which loses millions daily and is almost totally corrupt, while the poorest of the poor brave the rapacious cruel employers of the middle east, only to ‘keep the home fires burning’?
    What is the prestige of such an entity preying on the suffering of thousands?
    Are not our priorities lopsided?
    Does any other country do likewise?

  • 1
    0

    The sentence I agree with totally in this piece by Sarath De Alwis ins “If the government is serious about an economic recovery, it has to get out of the airline business.”

    No matter which way you look at Air Lanka it will always be a white elephant. A long time ago I travelled from Paris to Colombo in an Air Lanka flight. There were only 15 passengers in economy and two in business class. The cabin was like a funeral house – all quiet and hush hush. The cabin staff were bored stiff.

    Let us put the billions of rupees that goes down the gutter to keep this airline afloat to educate the foolish multitude who keep running behind the Ravana Balaya and BBS saffron robed thugs.

  • 1
    1

    I have been living oversees last 30 years , and travel back to sri lanka every year , hardly use UL, we don’t need this airline that take food away from millions of sri lankanans, always the story during last 15 years has been that some one at the top corrupt and taken lots of commission,
    sell it and use that money for hospitals and schools, keep Mihin as it cost much less to maintain,

  • 1
    2

    I think the A350s can be very handy if Srilankan know what they are doing and want to progress as an airline.

    Lets look at Colombo-Dubai sector as a case study and try to understand what really is happening and what needs to be done to make Srilankan profitable again.

    There are 3 Flydubai direct flights between Colombo and Dubai daily, there are 4 Emirates flights, many more airlines fly the same route with a stopover in various airports such as Mumbai, Qatar, Muscat, etc, but surprisingly there is only one(1) Srilankan flight per day between the two cities. Mihin Air is not even a player as it uses the Srilankan flight to piggyback on.

    Looking at this scenario we can see that in a sector that there is lots of passenger traffic but Srilankan flies only one flight???? Srilankan should fly as many flights into Dubai as UAE flights are flying into Colombo. That’s basic logic and its our right.

    The question is, why is that not happening? Could it be due to poor in flight service? or due to lower prices price of other airlines over Srilankan? or the nature of aircraft or lack of on board facilities? or bad management policy, lack of advertising, corruption, or perhaps lack of will power to make Srilankan great.

    Clearly if Srilankan can’t make best use of Colombo as a tourist destination by flying a fair share of passengers then there is something fundamentally very wrong some where.

    I can deduce clearly that if Srilankan were to compete favorably against the likes of Emirates, then Srilankan would also get a fair share of passengers and would have to increase the number of flights and hence increase its turnover and turn the loss into a profit.

    To achieve this we would need to give unparalleled in-flight service, have the most professional cabin crew, have the best and the most modern aircraft with all the bells and whistles and run the ground operations efficiently.

    To this end if Srilankan airlines actually wishes the best for its self and has the will power to excel as an airline, they should try to attract customers by all means. Go all out, no holds barred and make Srilankan flying experience a thing passengers long for.

    It goes without saying that a change of attitude would be the starting point. Then once that is fixed, the next essential thing would be hardware, the A350s are a must.

    Think about all the other routes that they can do the same. A350s the new 330-300s will be invaluable to compete effectively with the likes of Emirates, Thai, Singapore airlines, Cathey Pacific, etc. We may even have to buy more! Rather than chickening out. Remember Airlanka was the first airline to fly brand new A340s in South Asia in the 90s.

    However if there is no will power, its better we allow Iran air or whatever other airline that is ready to maximize the use of hardware and we can go into flying kites or bird watching even.

  • 4
    0

    I think Tilak Dissanayake makes sense. There is no need to have a “national carrier” just for the sake of having one. By all means keep the sectors that are profitable (catering and the training school), and sell the rest, and cut the losses. Try and lure major foreign airlines to service the demand to and from Colombo.

    • 1
      1

      Well said HLS. Sri Lanka should be happy with a regional airline
      operating into profitable routes in Middle East, India and Far East
      and have a fully equipped aircraft & passenger handling services unit, a well equipped catering unit to uplift meals on board and be the general sales agents for no. of airlines operating through Colombo and possibly have two runways with a well equipped alternate airport(Mattala) in case of diversions, if required. They should be careful on pricing and should see that their pricing should be cheaper than at Indian,Middle East and Far East airports, so that many airlines may get attracted by cheaper pricing and Colombo being in the centre between Europe and Australasia, and may choose Colombo for fuel stop and catering uplift and it all depends on pricing and there is money in it.

      This is what Dubai did under the Chairmanship of Mr. Morris Flanagan
      (Ex.BOAC) for no of years and Dubai became prominent on the aviation
      map and they started Emirates airlines at the right time. Like wise
      Sri Lanka should have a humble beginning and then build on.

  • 1
    0

    This fictitious ‘PM’s Global Advisory Committee ” is a figment of Alvarez’s fertile imagination!
    Egged on by that other liar Icky Atththa

  • 3
    0

    Its the people aney…People.

    One of the writers have praised the organisational structure of Emirates and the Emirate of Dubai. When the going is good, the shortcomings and screw ups never show up!

    Emirates had a plan. They essentially implemented the open-skies policy of Singapore, which Sri Lanka attempted to do in the late 70’s. As with all things Sri Lankan, the rulers change, and the policies go out of the window.

    Today Emirates is re-writing its history to one of forward thinking and master planning by its rulers. Bull-shit!

    They were blessed by global events, and policy decisions made by their management meeting at a rare sweet spot. Ordering A380’s by the dozens whilst the rest of the airline industry kept scratching their heads was one such instance. The oil prices hit $120 and guess what, only the A380 was a viable aircraft to fly half way across the world. The Singapores’, Cathays and British Airways did not have the aircraft to compete. The abdication of the UK and North American market into the Indian Sub-continent by the established national carriers after the SARS scare of the late 90’s allowed Emirates the window of opportunity they grabbed with both hands. Singapore, Thai, Cathay and BA have not regained lost market share in any of these sectors for the last 15 years. Sri Lankan Airlines has no policy or wherewithall to compete in this market except by price, and this has lead to a downward spiral in quality of service and sustainability.

    The collapse of the global economies in 2008 saw 100’s of projects in Dubai in particular, swing in the hot desert breeze. David Beckham and company did not buy anything. They were gifted these villas to make them attractive for other suckers. It is still a sucker’s bet to buy into these made-made islands in the Gulf.

    Sri Lankan Airlines will never get onto solid ground because the structure and foundation is built on debt and bad management. Ranil tries to get his people in, to get something done but they have no clue on how to manage an airline. A Bus Mudalali cannot run an airline, neither can the Matara Hotel man run a five star hotel. How many US Ivy league MBA’s does Ranil W have at his disposal? My 5 fingers may be too many.

    They should privatise it, with a 49% holding by the govt, perhaps guaranteeing past debts or forget about it once and for all.

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    Stupid win-win – win- win situ . I think you are from nowhere. You do not need a national carrier ????? then you dont need a motherland too. Go and jump in to the Indian Ocean.

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    ajantha
    Stupid win-win – win- win situation
    Stubborn and ardent clinging to one’s opinion is the best proof of stupidity
    Michel de Montaigne

    I am proud to be part of that 20 million. are you?

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    It is so surprising to see there are so many who still believe that UL can make money for SL or worse still, is making money.

    This tree called Air Lanka is sick, root, trunk and leaves and never bore fruit and will never bear fruit. Why do we eternally tend to this tree and fertilise it with truckloads of money, to keep this terminally sick tree alive. Is it because we are the proverbial ‘Sinhalaya Modayas’. This tree should be cut down and the roots pulled out and burnt and never ever plant another airline tree that we all know will only become sick and never bear any fruit.

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    Its absolute stupidity to dissolve Srilankan Airlines as some have naively suggested

    Srilankan Airlines is what Tea and Cricket is to Sri Lanka and is a well recognized brand having flown as a passenger for 12 years I can vouch for the fact that the Colombo to UK flights and the Maldives and Chennai flights were always full the only time there were empty seats on the london sector was in 2007 when the war was raging

    rather than kill the messenger they should re-orgsnise and re-structure the people who run the airline and scrap Mihin Lanka instead

    Imagine saying ah lets disband the SL Cricket team because it loses matches,….its equal to dissolving srilankan airlines!

    They should re think some routes which dont have a load factor and think of new routes which are always full like Australia and Canada (which can be possible is the A350 comes in)

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      Peace Lover,

      you may mean well.However maintaining even a Brand which has some national value is futile if it is not managed well and keeps of bleeding the national coffers.it is easy to to blame the former regime for most of the malaise of the Airline but what is surprising is the way the current Government is handling the matters.

      I believe you are not a person from an Airline background and as such the proposal to introduce new routes such as Australia and Canada on the basis A350 is capable of operating these routes.

      Let alone the financial implications SriLankan Airlines would be facing if go ahead with acquisition of A350,introducing the proposed new routes as suggested would certainly hasten the demise of this so called national Brand .

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      Peace Lover,

      Beg to differ.

      Tea and Cricket are different.

      Tea earns much needed foreign exchange and keeps many alive. Tea does not bleed the treasury.

      Cricket is a pastime that does not impact on the Sri Lankan coffers.

      Air Lanka is a huge big white elephant that costs billions of rupees to sustain, and has been so all through its history. Just imagine how many teachers we can employ in rural schools and put a decent roof over the children’s heads. Imagine how many sorely needed hospital beds we could add and how many nurses and doctors we can maintain. Please read the Weliamuna Report in its entirety to get an idea of the enormity of the money going down the drain just trying to prop up this ailing giant.

      Sorry, peace lover, Sri Lankan airlines must go.

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    Most of the comments made by the readers suggest closure of the Airline as there does not seem to be a way out irrespective of whether A350 aircraft join the fleet or not.

    it is not the Fleet that makes an Airline successful but how it is managed and sadly though this has been the issue for the last 10 years or so and continues to be so even under a new Government/management.

    Notwithstanding the Government rhetoric on the subject the appointment of a non professional Board on one hand and the selection of CEO/CCO on affinity rather than on ability on the other clears shows how serious is Prime Minister and his colleagues are in running this Airline

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    Looks like everyone wants to run Sri Lankan and has a plan !

    Wow, I pity the management, how they must be wishing they stayed where they were !

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    Tiru N is Mahinda Maama’s niece MP and former Minister Nirupama’s husband.(she’s Late George Rajapakse’s,daughter )

    Gravy train ran thick and heavy. He’s no aviation expert. Just happened to grab Airbus. Such commissions run into tens of millions of dollars per plane.

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    The Govt. should act fast to decide on the aviation policy of the
    country as this current venture, guzzles millions of dollars daily,
    which this country, with micro economy, cannot afford to lose in such
    large pro-potions on a daily basis.
    They should start all over again with a humble beginning by operating
    a regional airline, combining both airlines, to profitable routes in India, Middle East and Far East and narrowed bodied aircraft like Boeing 737 or Airbus 320 should suffice the aircraft requirement and be the General Sales Agents for as many airlines as possible.Have an open sky policy so that many airlines will chose to fly via Colombo,
    as SL will sure to boom as a tourist destination in time to come, provided they have a well equipped aircraft ground handling unit and
    a catering unit for uplift of meals on long haul flights but pricing, such as handling/engineering services fees, meals/fuel prices should be comparatively cheaper than the rates available in the neighbouring airports. This plan should bring profitability to the airline in a short length of time.

    This not the end of it and this is just the start and have a long term plan to develop the airline in stages and instead do not put the cart before the horse right now. SL Govt.,including PM Ranil, who had just said that we, Sri Lankans should get out of the South East Asian mentality, is shy to engage foreign experts to run the airline and tourism for us, for the start. The pride supersedes here as the govt. thinks that Sri Lankans can do anything and everything, even flying to the moon, and gives in to the ideas of the crooks, who wish to become board members,chairmen and CEOs. Even after learning a bitter lesson with the last management, the Govt.is still sitting pretty cool on this dollar guzzling airline.

    The whole problem with this airline is that all the parliamentarians
    want free 1st class travel, please their relatives in the airline,
    specially the operating and cabin crew by flying all over,on unprofit-
    able routes for prestige sake to maintain the excessive staff strength
    incurring heavy losses and commission ‘kakas’ in the airline board are more keen on purchases rather than restructuring the airline with what
    is available.
    PM Ranil should show his class that he is above the crooks and know-
    legdable and appoint a foreign committee of aviation/airline experts to decide on what our airline policy should be,considering the market potential and the financial position of the airline and the country as a whole. I hope this message from an airline expert reaches his ears.

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      You’ll be waiting forever, then. See what they said about the Emirates deal 18 years ago, even though today they cry about Mahinda sending Emirates out and how profitable it was:

      “Emirates deal web of corruption – UNP will disentangle it

      The main opposition UNP yesterday slammed the AirLanka-Emirates deal as one of the most scandalous national fraud and pledged it would disentangle the web of corruption and expose and bring to justice all parties who benefited from this corrupt transaction.

      In a hard-hitting statement, General Secretary Gamini Atukorale charged that the deal would turn the national carrier AirLanka into a virtual feeder service of Emirates airlines while it also provide for the unconscionable irony of giving a ten-year oil subsidy to a rich oil-producing state at a time when subsidies to the poor people of Sri Lanka are being reduced.

      The statement says:

      “On 5th April 1998 the Sri Lanka Government through a sudden press release announced that AirLanka would be embarking upon a US $550 million Airbus re-fleeting programme. As part of this exercise it was also stated that a one-sided agreement on consessional terms had been signed making Emirates the manager and strategic partner of Sri Lanka’s Flag Carrier, AirLanka.

      “Through this device the PA Government successfully by-passed all established Government Procurement and Tender Procedures and moved swiftly to purchase Airbus airplanes and related equipment which is ultimately expected to cost around US $700 Million.

      The UNP is now convinced that the so-called AirLanka restructuring had only one objective; namely obtaining illegal commissions from what is the largest single procurement made by the Sri Lanka Government in the last decade. What is even more scandalous about this transaction is that the avarice for these commissions was so great that the deal was structured so that the PA administration literally gave away our national asset and flag carrier, AirLanka, alongwith valuable international route rights to Emirates in order to achieve this unholy objective.

      “As a result of information now available in the public domain, it is obvious that the massive investment involved and the commissions that go with it will not only enrich the PA and its cronies but will also enable Emirates to recover up front their so called investment in AirLanka.

      “As an added bonus it appears that deal has enabled Emirates to avoid paying millions of dollars in cancellation penalties to Airbus by transferring their own surplus orders to AirLanka. In addition, Emirates, which is a competitor to AirLanka, will be in a position to cannibalize our national carrier and rationalize its route structure to its own advantage. This is demonstrated by the fact that the Airbus A-330 Aircraft, which has now been ordered, will impede AirLanka’s ability to serve the Indian market adequately and in the long term move AirLanka away from being an International Carrier and convert it into a feeder service for Emirates out of Dubai.”

      There is more in the link below.

      http://www.sundaytimes.lk/980412/news3.html#4LABEL1

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        How nice Bagehot it’s really rekindled our memories on the Emirates deal. It was a business buy over, Candrika got the deal done through her relationship with Chandana who was at the time working with Emirate. Then airline was sold for a song and he kept on singing using his PR and being very generously giving away J class seats and doing favours for all his political and personal friends, till Mahinda kicked Emiratrs out. Now we hear Ranil is bringing back the same man as CMO to Sri Lankan when he retires in May this year. Can you believe the slot is already made and is kept for him. So much for Yahapalanya.All these people will be accountable when the Present govt.is defeated in the coming polls.

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          WEll we all know the capabilities of this person,very generous in doling out company resources whilst at UL.He neither had the requisite educational/professional qualifications to hold the position of Head of corporate communications or even a managerial position

          If the news is right,what on earth is going to be achieved by UL by bringing him back to the Airline ? can anyone in his defense tell us what significant achievements he has made on behalf of UL.

          Would we ever see an end of these parasites

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      Lanka Watch,

      Do you really believe PM Ranil does care about the Airline ? I don’t know about his “class”‘ but surely his blessing given for the appointment of Board Members and senior appointments of CEO/CCO do not appear to be associated with any “‘class”‘ but affinity towards his Royal Club.

      It is easy to pontificate within the Parliamentary chambers but acting upon what they say is completely a different story.

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    I think Sir Richard Branson of Virgin might be looking at a deal with Sri Lankan Airlines. Note that he had talks with PM Ranil and said that he was going to make an investment in SL

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    Here is the solution:

    Colombo Airport: base for all wide-bodied Sri Lankan Airlines (specialising in medium to long haul routes including kangaroo route) but dropping all European flights except London and Frankfurt. Does not fly any domestic routes, or any routes to southern India or Maldives. Have 4 classes: First, Business, Executive Economy and Economy on Airbus 350s.

    Hambantota Airport: main base for all narrow-bodied Galle Airlines budget carrier (specialising in domestic routes and short to medium haul routes, including routes to southern India and Maldives.) Also specialising in pilgrimage flights to India and Myanmar. Galle Airlines (or whatever this airline will be called) to have a secondary base in Colombo Airport. Start regular daily shuttle flights between main cities in Sri Lanka and Southern India, with very good connections in Colombo and Hambantota for flights to and from Singapore, Kuala Lumpur and Bangkok.

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