NAC Prepares Business Plan to Purchase 5 Aircraft for Domestic Flights

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NAC Prepares Business Plan to Purchase 5 Aircraft for Domestic Flights

August 18: Nepal Airlines Corporation (NAC) has initiated the process to purchase five new aircraft for domestic flights after recently grounding its airplanes brought from China by spending billions of rupees.

The NAC is preparing to submit is business plan for a strong presence in the domestic market to the tourism ministry.

Although the business plan has strategies to reinforce NAC’s dominance in the domestic market, it does not mention anything about the management of the grounded Chinese aircraft.

The business plan only mentions that the NAC intends to buy the new aircraft to make a strong presence in the domestic market.

Executive Chairman of NAC, Sushil Ghimire, informed New Business Age that they are preparing to submit the proposal for the purchase of five aircraft in the first phase. In the business plan, NAC has demanded Rs 7 billion for the procurement.

Ghimire clarified that they have come up with a new business plan after incurring heavy loss while operating the Chinese aircraft.

The state-owned airline company had drawn immense criticism for purchasing the Chinese aircraft under political influence and without conducting adequate study. A board meeting of NAC on July 30 decided to permanently ground the China-made aircraft to avoid further losses.

NAC incurred losses of more than Rs 2.3 billion while operating the Chinese aircraft for the last five years.

NAC has four Y-12 and two MA-60 aircraft manufactured in China. But the flag carrier of Nepal is providing domestic service with two twin otters after grounding the other six aircraft. Another twin otter is currently under maintenance.

“Private airline companies operate flights to those destinations where they can make quick money. That is quite natural,” says Ghimire, adding, “But NAC has to fulfill its social obligation by operating flights to those destinations that are not commercially viable. We have to provide service to the remote areas to strengthen our presence.”

NAC has only 3 per cent stake in the domestic market.

 

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