Pakistan International Airlines (PIA) has terminated its Premier Service after seeing the enormous losses in the past six months.
As per the official records, total earnings of the service during 14th August 2016 till the 8th February 2017 remained at about rupees 0.96 billion.
The losses suffered on direct operations were of rupees 1.14 billion while the total loss amount calculated was of rupees 2.88 billion.
Premier Service was launched on the Pakistan’s 69th birthday that was on the 14th August 2016. The service was introduced on Islamabad/Lahore—London—Lahore/Islamabad routes with A330 airplane.
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At the time when the service was launched many claims were made including the claim that PIA would experience transformation and would be changed into an updated profit-making airline.
The airline also announced many other features including the in-flight entertainment feature, along with the complimentary limousine service for the Premier Business Class passengers upon their arrival at the Heathrow Airport—London.
It was informed that for the provision of better quality services to the customers, meeting international standards an airplane had been taken on wet lease from the SriLankan Airlines.
According to the National Aviation Policy, an aircraft cannot be wet-leased for a period span of more than six months, so the deal with the SriLankan Airlines for wet lease acquisition of the Airbus A330 ended on the 9th of February 2017, and the aircraft was given back to the owner airline.
Talking about the losses faced by the national carrier, the management stressed that the new fares were chalked out but due to the capacity surplus the overall fare levels did not rise and PIA had to rely on a minimum fare range whereas the competitors were charging much higher rates.
Owing to the losses it was decided that the Premier Service is to be suspended until PIA’s owned aircraft—B-777s are updated with the services like flatbed seats, Wi-Fi, IFE, etc.
It is noteworthy that however the Premier Service has been suspended the flight operation to London has not suffered. PIA is still operating the same number of flights to London but now by Boeing 777s.
Officials said that the SriLankan Airlines was chosen after a clear and honest bidding procedure. Three bidders participated in the bidding process namely SriLankan Airlines, TAG-Linhas Aereas De Angola, and Hifly. After the technical assessment, the bidder with the cheapest price per seat was selected.
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