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New Kuwait Airways chief rues missed fleet opportunity

Kuwait Airways’ new chief admits the flag-carrier’s need for new aircraft, combined with a drain of high-quality personnel, is threatening the airline’s ability to maintain a reliable service.

Plans to replace the Kuwaiti airline’s fleet fell through last year and a renewal is unlikely before the Government privatises the operator, but this might not happen until the end of 2009.

“We have only 17 commercial aircraft, and the schedule is really tight,” said chairman and managing director Hamad Abdullatif Al-Falah, speaking to ATI at the IATA annual general meeting in Istanbul.

He says the ageing and diverse fleet is becoming more difficult to maintain because the airline has had to cope with losing 40% of its mechanics, particularly to other carriers offering higher salaries. New recruits make up numbers, says Al-Falah, but often lack valuable experience.

“Our major aim, of course, is maximum safety,” he says, but adds that routine mechanical checks which used to take 45 minutes are taking much longer. “With older aircraft and less-experienced staff it takes more time to do the job. It might take an hour, sometimes two, with ageing aircraft it could be six or more – sometimes we have to cancel the flight.”

Al-Falah regrets the collapse of last year’s tentative renewal agreement with Kuwaiti lessor ALAFCO which would have given the airline the opportunity to take relatively early delivery of new Boeing 787s and Airbus A320s.

“It was a very bad decision from the Parliament,” he says, attributing it partly to a sense of mistrust and suspicion which he claims governing authorities have towards the airline.

Introduction of a simpler two-type fleet, Al-Falah states, would have been “very good” for the carrier, enabling it to make more efficient use of its pilots – such as those who are limited by governmental-flying duties on certain types – as well as its technical staff. But the renewal has been postponed until Kuwait Airways’ long-awaited privatisation is complete, effectively deferring responsibility to a new investor.

Al-Falah says the carrier in the meantime has only secured permission to lease two more aircraft – an A320 which is coming from Egypt’s Lotus Air, and either an A330 or a Boeing 777 which will probably be sourced in November. He says the leases are short-term but he hopes to extend them until the end of 2009.

Under the privatisation plan, 35% of the carrier will go to a strategic investor. Another 40% will be sold publicly, and 5% will go to the airline’s staff.

The remaining 20% will remain with the Government. Al-Falah says this figure is below the threshold which would give the Government the right to step into the decision-making process.

“We’re really saying ‘keep out’,” he says. “We hope [the Government] won’t interfere or try to buy more [shares].”

Kuwait Airways employs 4,000 staff, of which 1,900 are Kuwaiti nationals. Ironically, while the airline is battling to hold on to pilots and mechanics, the local employment system has left the carrier heavily overstaffed with administrative personnel. “I could get rid of at least 30% of them,” says Al-Falah.

Some 640 of the Kuwaiti staff will be eligible for a special retirement scheme linked to the privatisation, under which they will be offered three years’ salary and other benefits.

Al-Falah says this arrangement is a “good offer” and believes the majority of these employees will take it up. Kuwait Airways’ new investor will be required to retain transferring Kuwaiti staff for at least five years.


Source: flightglobal.com's sister premium news site Air Transport Intelligence news
 

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