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Airbus, Boeing vie for Pakistan
order
By Syed Saleem Shahzad
KARACHI - The Board of Directors of Pakistan
International Airlines (PIA) last week approved the
purchase of five Cathay Pacific Airline 747-300 Boeing
aircraft that the national carrier is currently leasing,
but members could not agree on whether to upgrade the
fleet with new craft from Boeing or from Airbus.
A final decision on the purchase of new aircraft
was due to be made this week, but it has been delayed
amid reports of deep divisions within the PIA board -
something not uncommon in the history of the state-owned
airline, which falls under the jurisdiction of the
ministry of defense.
PIA has been in need of new
aircraft for some time, especially as its fleet has
grown in a haphazard and often controversial manner over
the years, with allegations of decisions being made on
the basis of vested interests. Aviation experts say that
the process of proper fleet planning ended in the early
1980s.
Effective fleet planning means the timely
replacement of old aircraft with new ones, as well as
the systematic purchase of aircraft that will ensure
compatibility within the fleet. At present, figures
presented by PIA indicate that it has a fleet of 50,
including five Boeing 747-300s, eight Boeing 747-200s,
seven Boeing 737-300s, nine Airbus A-300-B4s and six
Airbus A-310s.
The PIA management has finally
accepted that it needs to introduce widebodied carriers
into the fleet now if it wants to remain competitive,
and especially as many of its craft are in poor
condition and face being grounded for repairs.
The Pakistan Civil Aviation Authority (CAA) has
warned PIA several times in official communications to
meet safety levels or face grounding. But since the CAA
also falls under the ministry of defense, the ministry
was able to intervene and defuse the dispute.
The US Import and Export Bank has shown a
willingness to provide 60 percent financing if PIA opts
to buy Boeing craft, while the manufacturers of the
A-340 Airbus have offered to make available 75 percent
financing if their craft are bought.
With this
knowledge, the PIA constituted an evaluation committee
headed by Air Vice Marshal Salim Arshad, which traveled
to Seattle and Paris to assess the purchase of either
the Boeing or the Airbus.
Boeing has offered
three new 777-200ERs for delivery in 2003-04 at a cost
of $120.96 million to $127 million each. Airbus has
offered two new A-340-300 white bodies at $101.9 million
each and two white tail A-340-300s at $84 million each.
United Airlines of the US has also offered four
used 777-200ER aircraft to PIA. Two of these have
manufacturing dates of July and August 2000
respectively. The other two carry dates of May 1999 and
April 1997. United wants $114 million each for the
former two and $107 million and $96.1 million
respectively for the latter two. However, sources said
that PIA had decided in principle that it would only
purchase new aircraft.
Insiders claim that the
PIA management has decided to go for Airbus, even though
its craft have had some technical reliability
difficulties with PIA. The worst problems have related
to metallurgy, with a number of the 15 Airbus craft on
the fleet being affected. The first batch was purchased
in the late 1970s. Three of them - including
registration numbers AP-BAX, AP-BAY and AP-BAZ - were
bought because they were available at comparatively low
prices. AP-BAX soon developed a fuel leak while the
others had this problem later on. PIA engineers failed
to permanently contain this problem, which the higher
management considered to be incompetence on the part of
the engineers. Under the warranty agreement, Airbus
engineers were invited to fix the problem, but it has
repeatedly recurred.
The Airbus aircraft also
appear to have developed corrosion problems faster than
other planes. Two years ago, an aircraft narrowly
escaped disaster on the Islamabad-Karachi route when it
developed problems in one of its toilet compartments due
to corrosion, and the pilot only just managed to make an
emergency landing. Despite numerous complaints, Airbus
has reportedly failed to control the corrosion problem.
At the same time, the cost of Airbus spares is almost
double that of Boeing's.
Given these
experiences, PIA decided not to purchase any more Airbus
craft, but in the late 1980s and early 1990s the
government of Benazir Bhutto put heavy pressure on the
PIA management to purchase Airbuses, arguing that in
return France would help Pakistan acquire a nuclear
power plant, which never happened.
(©2002 Asia
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