Sri Lankan state-owned carriers Mihin Lanka and SriLankan Airlines will work closely to leverage on economies of scale and to fight against low-cost competitors.
For one, the two carriers are already under the watch of the same man. Kapila Chandrasena was already chief executive of Mihin Lanka when he was made chief and tasked to turn SriLankan around last year.
Teams are now working to plan the two carriers' network as a single unit and position Mihin Lanka to provide feeder traffic for the flag carrier, Chandrasena said at a recent interview with Flightglobal in Beijing.
This includes adding services to Bangladesh, Jakarta and Sharjah "so that SriLankan can leverage the network contribution".
"The aim is for both carriers to work very closely together. Depending on the market, we position the right brand, hoping that by doing so we can face the competition. In Sri Lanka, we're seeing a huge increase in low-cost competition," says Chandrasena.
This year, Mihin Lanka will also grow its regional network to Nepal, Myanmar and India, and add an Airbus A321 to its fleet.
The carrier is also leveraging on SriLankan's operational platform, ground handling, engineering, catering and training for greater economies of scale.
SriLankan, meanwhile, is targeting to return to profit by 2015 and has recently been announced as a member elect of the Oneworld alliance.
"It's been a challenging year. Everyone asks how I manage both airlines. It's tough but I have a good senior management team, so we have been able to handle it," says Chandrasena.