The dilemma of the Pakistan International Airlines (PIA) continues, as the government tries to come up with a viable plan to pull the national flag carrier out of financial crisis. While previous steps have failed, now the PTI government has awarded a $1.2 million contract to the International Air Transport Association (IATA) to carry out a business plan for PIA to help its failing fortunes. PIA had previously submitted a plan in 2018 but this had been rejected by the government, which has instead hired international consultants to study and advise for the airline. IATA has been awarded the contract because it was the lowest bidder.

The foreign consultants will submit their report in 20 weeks. It is reported to be a game-changing plan, which will bring in sweeping changes to PIA.

What can PIA expect? One thing is for certain—the existing workforce of the PIA will see major layoffs. The estimated number making the rounds is more than half. This might be disappointing but should be no surprise considering the aircraft-to-employee ratio of PIA had been 500 employees per aircraft. The Voluntary Separation Scheme (VSS) with a target of laying off 3,500 workers, while well-intentioned, had also seen major hurdles, with some employees not getting their due share.

Apart from workforce cuts, the proposed plan is also expected to give a comprehensive view of PIA’s current competitive position in the industry, by analysing sales and the marketing strategy for each region, route and destination. This means that a thorough rationalisation of PIA’s costs will be conducted, to see which are being wasted on frivolous endeavours.
The cost of this project is high; it is unfortunate that the government was not able to do this itself or locally and the task had to fall on international consultants. Nevertheless, the government must monitor and make sure the consultancy provides a comprehensive, thorough five-year plan. At the same time, the PIA must be prepared for some major restructuring.