NAC prepares for another fleet expansion

Nepal Airlines Corporation (NAC) is in the headlines once again. The national flag carrier has unveiled an ambitious international fleet expansion plan under which it will acquire four aircraft for international operation over the next two years with the first one joining its fleet within a year.
NAC is buying two wide-body and two narrow-body aircraft in line with the two-year action plan unveiled recently by the government. According to the plan submitted to the Ministry of Culture, Tourism and Civil Aviation, the second wide-body aircraft will joint NAC’s fleet by February, 2017. Similarly, NAC also plans to acquire two more narrow-body aircraft with the first one joining the fleet by May 2017. The second narrow-body aircraft will join the fleet two months letter. NAC has already requested the finance ministry to arrange Rs 26 billion for financing purchase of two wide-body aircraft.
NAC purchased two Airbus A320-200 aircraft earlier this year by borrowing Rs 10 billion from the Employees Provident Fund. It was NAC’s first international fleet expansion in 27 years.
In its business plan, NAC has stated that it would serve destinations in North America, Japan, Australia and the United Kingdom once the wide-body aircraft join its fleet. NAC used to fly to different destinations in Europe and the Far East Asia in the 1990s.
But fleet expansion alone is the pill to all ills. The national flag carrier, which enjoyed market share of 50 percent in international flights in 1979, has seen its share fall to a meager 5.87 percent. Lack of proper marketing and failure to use effective marketing tools has also been a major hindrance to growth for NAC. Though NAC is heavily overstaffed, it is facing dearth of skilled workforce. For example, it doesn’t have required number of pilots two commandeer its Airbus A320 aircraft. As a result, it has been hiring foreign pilots by paying hefty wages. It is not only bleeding the national flag carrier white, but also infuriating Nepali pilots who are paid far lower. Similarly, the Chinese aircraft – MA60 and Y12e – have already become burden for the national flag carrier. The situation is expected to worsen further once the remaining four Chinese aircraft – three Y12e and one MA60 – joins its fleet.
NAC is also suffering from inefficient management. Its flights often get delayed or cancelled just because of lack of spare parts in its inventory. Industry people often say they do not get tickets even as NAC’s aircraft fly empty.
A proven administrator, Sugat Ratna Kansakar, is at the helm of the national flag carrier once again. It was during his first stint at NAC that NAC managed to add two Airbus A320s in its fleet. Kansakar has unveiled an ambitious plan of adding four new jets. Market is not a problem for NAC as other international airlines are doing brisk business in Nepal.
But fleet expansion alone won’t help. NAC needs to have an efficient management team that can ensure effective aviation service. Kansakar and his team must get rid of unproductive manpower and immediately hire young, energetic and efficient staffers who can drive the national flag carrier forward.