Loss bearing PIA weighs on VSS for survival

The management of Pakistan International Airlines (PIA) is weighing options to revive its fortunes, as the airline continues to incur losses worth billions of rupees on a monthly basis.

Business Recorder reported that discussion over Voluntary Separation Scheme (VSS) in PIA has started under the Reforms and Restructuring Programme (RRP).

The loss earning national flag carrier, which has the highest employee to aircraft ratio i.e. around 500 employees per aircraft in the world, has got two options to survive either to go for massive lay-off or separate non-core services from the airline.

As per details, PIA is considering the second option after sources said that the RRP presented by PIA in May 2019 proposed the concerned authorities to secede all non-core services from the airline and establish at least five separate business units for engineering, catering, airport service, etc. along with handing VSS to nearly 3000 employees, which will reduce airline workforce by 7000 and help PIA to bring down its 'employee to aircraft ratio' to an acceptable level i.e. 200 employees per aircraft, which otherwise could only be possible if airline expanded its fleet to 70 aircraft or lay-off up to 8,000 employees.

It may be mentioned here that the airline currently incurred a monthly loss of about Rs6 billion and spent Rs24 billion per annum on the salaries of 14,000 employees.