SriLankan Airlines does not have any Strategic Plan to Deal with the Losses – COPE

SriLankan Airlines has been asked to do a major overhaul of their strategies and structure to deal with the losses the company has been making.

The Committee on Public Enterprise (COPE) which carried out an inquiry on the government airline, has directed the company to conduct a ‘restructuring programme’ to address the current financial crisis faced, COPE Chairman Sunil Hadunnetti said.

“SriLankan Airlines currently does not have any strategic plan or restructuring plan to deal with the losses, the COPE inquiry highlighted. Sri Lankan was advised by COPE to evaluate their route options, draw up a new route schedule at least to cover the key destinations in the Asian region, and come up with sound market strategy to deal with the loss. The company is on a minus equity footing right now, they should at least try to break even,” Handunnetti said.

“The company has made a total loss of staggering Rs. 102,000 million for the last five years, it was revealed in the committee inquiry.

In 2015, the government allocated the company Rs.19,000 million from the Treasury, however the company still incurred a loss of Rs. 15,000 million during the last year alone. Added to this, the company pays $1.5 million per month for hire of air buses,” Hadunnetti revealed.

“The loans and the interest SriLankan Airlines has right now are unbearable for the company. SriLankan should look at putting the plans to purchase air buses on hold for now and see how to minimize losses for the company. A feasibility study should be done,” he said.

“They should look into laying off workers, paying compensation and go through a restructuring process, to assess the flight routes and other key areas”.