July 20: Nepal Airlines Corporation has decided to stop using Chinese aircraft from July 30 after incurring losses regularly.
The flag carrier of Nepal currently has four Y-12 and two MA-60 Chinese-made aircraft. MA-60 has a capacity to carry 56 passengers while the Y-12 is an 18-seater aircraft used for domestic flights.
Stating that the state-owned aircraft company of Nepal has been incurring losses regularly while operating these aircraft, NAC decided to stop using them altogether.
A board meeting of NAC recently decided to halt the operation of the Chinese aircraft, said a source informed about the matter. According to the source, the board assessed that NAC has incurred losses worth Rs 1.9 billion from Fiscal Year 2071/72 to FY 2075/76 while operating the Chinese aircraft. Fearing that the airline company would face further losses if it continues using the Chinese aircraft, the board decided to stop their operation. NAC estimates the losses will climb to Rs 2.3 billion in the current fiscal year.
The board meeting concluded that it is not profitable to operate Chinese aircraft because of the cost factor. The insurance premium for these aircraft is 35 percent more than other aircraft while the pilots are not easily available. As the company has to produce the pilots itself, the cost becomes more expensive than operating Airbus 320, the board noted. Therefore, the board decided to stop the operation of the Chinese aircraft, the source said on condition of anonymity.
Similarly, the spare parts of these aircraft are 75 percent more expensive that other aircraft. On the other hand, it takes a long time for delivery of the spare parts of these aircraft.
According to the NAC source, both the aircraft lack instructor pilots and the training for such aircraft costs four times higher than normal training.
In the meantime, the fuel consumption of the Chinese aircraft is double than other aircraft.
A board member of NAC informed that the national flag carrier of Nepal cannot operate the aircraft and therefore decided to ground them. The board member said that they have written a letter to the Ministry of Culture, Tourism and Civil Aviation that it is not commercially viable to operate these aircraft.
The NAC board has been discussing this issue since the last 20 board meetings but has not been able to decide on proper management of these aircraft. Now, it is up to the government to decide the next step, the board member said.