SriLankan Airlines is aiming to put its troubles behind it and return to profitability by 2013 under a new five-year strategy that will see the carrier double its fleet and attempt to join an alliance.
The airline, almost entirely owned by the Sri Lankan government after Emirates sold its 43.6% stake in 2010, has been undergoing a five-month consultancy period with Intervistas Consulting Group to plot its future path.
Under its strategy for the next five years, SriLankan aims to "roughly double" its fleet from 15 to 30 aircraft, the airline's newly-appointed chief executive Kapila Chandrasena says. He was speaking while in Berlin at the World Route Development Forum.
Its fleet renewal will be partly funded by a $500 million equity infusion from the Sri Lankan government, which was approved in July 2011. SriLankan is looking to add "roughly six widebodies" from 2014 to replace its Airbus A340-300s, and is considering the Airbus A330-300 and the Boeing 777. The airline is in talks with Airbus and Boeing but has yet to decide whether it will purchase or lease the aircraft. "We are looking at a possible blended approach, where we own 25% and lease 75%," says Chandrasena.
In the meantime, SriLankan is taking used A330s from lessors, including Air Lease and International Lease Finance. It hopes its strategy of strengthening its regional network and capitalising on the tourism opportunities that have arisen since the end of Sri Lanka's civil war two years ago will see it profitable in 2013.
"We had an internal conflict [in Sri Lanka] for 30 years and that was a barrier to the growth of the economy," says Chandrasena. "Two years ago the war ended, and with the dawn of peace we see an opportunity for Sri Lanka."
The airline aims to double the amount of annual passengers to six million a year under a new network plan that will see it boost services to China and India. It will also look to add destinations in Australia and South Korea.
SriLankan is also keen to join an alliance "as soon as practicable", adds Chandrasena. "Oneworld and Star are preferred, but we need to know about SkyTeam to see if that could be a fit."
Chandrasena took the helm at SriLankan at the start of August. He joined from state-owned, low-cost carrier Mihin Lanka, and now finds himself managing both carriers simultaneously.
"We will synchronise the two airlines' networks and integrate the economies of scale," he says.