NAC told to submit plan for major fleet expansionThe Ministry of Culture, Tourism and Civil Aviation has directed Nepal Airlines Corporation (NAC) to submit a concrete report on purchasing at least eight fixed-wing and four rotor-wing aircraft and hiring the required workforce.
The Ministry of Culture, Tourism and Civil Aviation has directed Nepal Airlines Corporation (NAC) to submit a concrete report on purchasing at least eight fixed-wing and four rotor-wing aircraft and hiring the required workforce. The eight planes are planned to be used for domestic and international operations while the helicopters will serve remote destinations.
A NAC board meeting on Monday chaired by Tourism Secretary Dinesh Kumar Thapaliya instructed the corporation to submit the report within a month.
“As we need an aircraft investment strategy that involves aircraft purchase, procurement cost, type of aircraft, and the management of resources and manpower to make NAC an efficient organization, the meeting decided to conduct an extensive study before starting the procurement process,” said Thapaliya.
The national flag carrier has been told to study the feasibility of procuring two wide-body and two narrow-body aircraft for the international sector, he added. With regard to domestic operations, the airline has been instructed to buy four Twin Otters or similar aircraft. Likewise, the viability of operating four helicopters on remote terrain will be studied, Thapaliya said.
After the study report is submitted, the ministry will help NAC to go ahead with the procurement process, he said, adding that the procurement would be conducted in a phase-wise manner. “As NAC has tremendous potential to grow, there must be a relentless focus on costs and efficiency, coupled with a commitment to delivering quality.”
The corporation has also begun the process of hiring a management consultancy firm to assist its overall system performance. It is presently evaluating the letters of intent submitted by 21 foreign firms including Lufthansa Consulting and Airbus to provide world class management consultancy services.
A short list of qualified applicants will be made, and they will be invited to submit requests for proposal (RFP) through a bidding process, according to NAC officials. The consultancy services include a need assessment and gap analysis of the overall organization in the first phase, and handing over the management contract in the second phase.
NAC’s 10-year business plan (2014-24) has proposed procuring four wide-body and five narrow-body jets, including the recently purchased A320, for use on long-haul routes like Europe, Australia and the US besides Asia.
The national flag carrier purchased two Airbus A320-200 aircraft this year by borrowing Rs10 billion from the Employees Provident Fund, its first fleet expansion in 27 years. It has also received an MA60 and Y12e aircraft from China as gifts, and has signed a commercial agreement to procure four more planes for its domestic fleet.
Presently, NAC holds a meagre 5.87 percent share of the market in the international segment. It flew 206,430 passengers last year. The carrier serves seven international destinations, including three Indian cities, and plans to expand operations to three more destinations, namely Guangzhou, Dubai and Saudi Arabia in the near future.
A decade ago, NAC was flying to 21 international destinations. Its international network has shrunk rapidly since then reflecting the rot within caused by mismanagement and political interference.
Meanwhile, the corporation has inducted three new members into its board. Rajesh Kazi Shrestha, Nima Nuru Sherpa and Mukti Ram Pandey are the board members representing the private sector.