Aviation: the rot deepens

PIA’s financial and operational demise is a known fact, and enough is being discussed in media on its privatization and other matters. However, not much has been said about its implication on the other airlines and air travel – especially domestic, and about the (lack of) role of the oversized regulator – Civil Aviation Authority.

A few months back, when PIA was still running regular operations, there were around on average 18-20 daily domestic flights (to-and-fro) and now the number is reduced to half (or even less, if PIA is excluded) while the domestic tickets prices have doubled in PKR at a time when international oil prices are falling, and PKR is somewhat appreciating against USD. Then there is sporadic cancelation of domestic flights (by PIA and other airlines for ‘operational reasons’ other than fog/smog). The consumers are at a loss, as not only they are paying a higher fare but also have fewer options for travel.

One reason for the lower daily domestic flights is curtailed and erratic operations of PIA; but there is more to the story. Logically, if PIA flights are reduced, the private airlines (four in total operating domestically) should increase the flights to take PIA’s share. However, these airlines have also reduced the number of domestic flights. That is because some have move to lucrative international routes, as recently, others have been allowed to operate internationally while the rest were already running international flights.

“The overall cost of operating from Lahore to Muscat is almost similar to running a flight from Lahore to Karachi while the revenues are more than double, hence, it makes commercial sense for us to run more international flights within our limited capacity”, candidly said an airline employee. The higher charges for landing and parking rights in the international sector are being compensated for by lower fuel costs there.

Thus, lately, domestic airlines are increasing their flights to the Middle East, which is adversely affecting the domestic routes, as airlines have limited aircrafts and pilots, and it is difficult and expensive to lease new aircraft due to high country risk, and hard to find good human resource, as skilled labour is inclined to leave Pakistan. Moreover, general aviation is getting small, and that is limiting the supply of new pilots which need certain experience (flight hours) before they can run commercial aircraft.

Thus, the bigger problem is that the aviation industry has shrunk, as today all five airlines combined (including PIA) have 40-45 running aircrafts while in good days PIA alone had 80-85 aircrafts. The pie is shrinking while the population is growing. Something needs to be done.

That is a medium to long-term problem which has lately become magnified due to lack of PIA’s reliability, which is becoming contagious, as others (especially one domestic private airline) are cancelling flights frequently. The airlines usually submit their annual flight schedule and then people book tickets in advance to secure lower fare. However, lately, airlines are cancelling flights by citing operational reasons close to the flight day, as they find it more lucrative to operate on other routes. And at times, they overbook flights, and cancel old bookings (which are usually at cheaper rates) and replace them with travellers who buy expensive tickets closer to the flight time.

Poor consumers are at a loss in the process, as either they must buy expensive tickets or opt for other ways of domestic travel. Here the role of the regulator is in question, which is letting such practices go unchecked taking place right under its nose. The regulator is not imposing any penalties and not ensuring airlines to have certain number of domestic flights.

Without justifying the lacklustre behaviour of the regulator, the absence of reliable flights from PIA is hampering the domestic travel. PIA had an active role to play, as it not only had the highest number of domestic flights, but also was ensuring fares to stay within a certain limit. Then there are a few airports where only (or majorly) PIA was operational in domestic flights such as Faisalabad, Multan, Peshawar, and other smaller destinations. The other airlines are mainly operating on two routes – Lahore to Karachi and Islamabad to Karachi while the commuters from other cities must travel to these cities.

It appears that no other airline is finding commercial viability to operate from smaller cities. One of the reasons is that new airports in Lahore and Islamabad are connected to ring road and motorways, and time to reach airports from other cities have reduced. For example, after the opening of Sialkot-Lahore Motorway (M11), the domestic flights have almost stopped operating from Sialkot. Then people from Faisalabad are travelling to Lahore or Islamabad for flights to other destinations. Although the time to reach airports has reduced, still it is a hassle and costly for travellers to reach other cities’ airports. Again, it’s a consumer loss.

The government and regulator should wake up to ensure domestic flight operations. Private airlines want to expand; but are facing constraints in terms of leasing new aircraft and recruiting pilots, and some are relying on short-term contracts of foreign pilots while many PIA pilots and aircrafts are idle, as its operation is very limited now. There has to be an innovative way to bring PIA resources in use.

Then the international airlines can have a role to play. Today, perhaps there are more flights between Karachi and different UAE destinations, including Dubai, than all the domestic flights combined. Emirates alone is running 5-6 flights a day. Some of the foreign airlines want to operate on Pakistan’s domestic routes, as they find a lucrative market which is currently under-addressed while domestic airlines don’t want this competition, as domestic routes give a level playing field to small domestic airlines to grow.

At the same time, domestic airlines are ditching the domestic traveler – they cannot have the cake and eat it too.

The government and Civil Aviation Authority should wake up and look at the airline sector beyond privatization (or shelving PIA) by bringing PIA resources into use, and pushing the other airlines to streamline practices. And if they cannot do so, let the foreign airlines to operate domestically, as consumer should be the king, not airlines.

Copyright Business Recorder, 2024