KATHMANDU, Dec 17
Things seem to be getting better at the Nepal Airlines Corporation (NAC) that has been on a downward spiral for over two decades due to political interference. It will start trial and regular flights immediately after the European aircraft manufacturer Airbus delivers the new plane.
Airbus has already completed building the body and painting of the plane to be delivered to the NAC and is currently putting engines and seats, according to the NAC. The NAC will get the first plane in February and the next in April. NAC General Manager Madan Kharel claims that the fading fortunes of NAC will also get bright with introduction of these shining 158-seaters. “Efforts for managerial and technical reform have already started. This has also showed signs of financial improvement,” he states. Management of the NAC, that currently survives through ground handling services, has already projected doubling of its income in the coming year
President of the Nepal chapter of the Pacific Asia Travel Association (PATA) Suman Pandey states the NAC can get a huge market share if it were to reform itself. He hopes that the country’s tourism will also gather momentum with acquisition of new planes by the NAC. Big and chain hotels are now being started in Nepal and he feels more hotels will arrive if the NAC were to get stronger. “A total of 27 international airlines are currently taking money from Nepal. That money would have stayed in Nepal were the NAC stronger,” he adds.
The NAC has projected to earn Rs 15.58 billion from operation of the new planes. It had earned around Rs 7.50 billion in the last fiscal year. It currently earns around Rs 2.50 billion from ground handling. The NAC, that currently has only two narrow-body planes, has projected to earn US$ 134 million (around Rs 13.40 billion) from international flights alone in the upcoming year if everything were to be done as per the schedule. Stating that it will provide service through 13 planes within 2015, the NAC has already decided to move the process to buy two more wide-body and two narrow-body airplanes by 2017. The NAC has already revealed its plan of operating international and domestic flights with 25 planes, including nine for international flights, by 2024. NAC Spokesperson Ramhari Sharma says it has already started process to bring five narrow-body and four wide-body planes within 10 years.
Kharel, who was appointed general manager through free competition two years ago, is trying to improve internal management of the NAC. Tourism stakeholders also concede the NAC has showed signs of improvement. “The NAC is currently on course of improvement. This is reflection of the overall tourism sector and economic state,” General Secretary of the Hotel Association of Nepal (HAN) Vinayak Shah states. “There are examples of success of national flag-carriers in countries with thriving tourism. We can easily attract two million tourists if the NAC were to improve,” he adds.
The NAC has also projected business of US$ 184 million (around Rs 18.40 billion) and net profit of US$ 11 million (around Rs 1.10 billion) by 2016. It aims to do annual business of US$ 524 million (around Rs 52.40 billion) and net profit of US$ 58 million (around Rs 5.80 billion) by 2024. It also aims to raise authorized capital to Rs 35 billion and paid-up capital to Rs 33 billion by 2024. It plans to cater to 578,000 passengers annually through international flights within 2015 and 1.54 million by 2024. Likewise, it plans to cater to 1 million passengers annually through domestic flights within 2015 and 1.39 million by 2024. “We will increase our market share to 25 percent in international sector and 30 percent in domestic by 2024,” he reveals.
The commercial plan of NAC states that MA-60 planes alone will cater to over 255,500 passengers annually in the domestic sector in 2015while Y-12 E will serve 34,500 passengers a year. It plans to serve around 500,000 passengers a year including with Twin Otters. The NAC will operate three Twin Otters, two MA-60s and four YI-12 Es in the domestic sector four months later. It plans to cater to 1.99 million passengers a year in international and domestic sectors by 2020. The NAC plans to operate two Boeings and two Airbuses until 2015 in the international sector before gradually phasing out Boeings.
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