Responding to former Prime Minister Ranil Wickremesinghe’s criticism of the commencement of the procurement process for new aircraft by SriLankan Airlines, former State Minister of Aviation and Export Zones Development and newly-appointed State Minister of Tourism and Fisheries D.V. Chanaka stated that over the next three years, SriLankan Airlines will be returning 12 of the 24 airplanes in its fleet, and that it is thus necessary to obtain replacements for these airplanes to be returned.
Speaking in Parliament yesterday (19), Chanaka stated that although the procurement process to obtain new airplanes had been commenced by SriLankan Airlines, the airplanes would actually be acquired in around 12-18 months. He further stated that the Government will not be spending a single cent for this acquisition of new airplanes, and that it will be funded entirely by SriLankan Airlines, which, he added, is a profit making entity.
Moreover, he defended the decision to acquire new airplanes, claiming that over the past one-and-a-half years, the SriLankan Airlines fleet has decreased from 27 to 24 airplanes, and will decrease further over the next three years, with 12 airplanes scheduled to be returned upon the expiration of their lease period.
“During the next three years, we will have to return 12 more airplanes from our current fleet of 24 planes. Therefore, the new airplanes are replacements. We will have to return the first airplane by the end of this year, resulting in the fleet reducing to 23. Four months later, we will have to return another plane. We will have to return eight of our 12 wide-body aircrafts during the next three years, and four narrow-body aircrafts as well,” stated Chanaka.
Previously, Wickremesinghe, while criticising the Government's management of the economy, had questioned as to why SriLankan Airlines is seeking to lease 25 aircrafts when the company continues to lose money, stating: “If the company is profitable, why doesn't it repay the loans it owes to the Bank of Ceylon?”
Similar sentiments were expressed by Samagi Jana Balawegaya (SJB) MP Dr. Harsha de Silva, who stated that SriLankan Airlines Chairman Ashoka Pathirage had shared with him a SriLankan Airlines press release that mentioned SriLankan Airlines would be seeking to acquire 21 airplanes through the forthcoming Request for Proposals (RFP) process. Dr. de Siva called on the Government to rethink this decision, considering the economic situation of the country and the fact that the new Ministry of Finance Ali Sabry is currently negotiating with the International Monetary Fund (IMF) to obtain a Rapid Financing Instrument (RFI) for for Sri Lanka.
In justifying the decision to acquire new airplanes, State Minister Chanaka further pointed to the improved finances of SriLankan Airlines, stating: “When Sri Lankan Airlines was handed over to us, the fleet consisted of 27 airplanes. Over the past one-and-a-half years, we returned three of the airplanes upon the conclusion of their respective lease period. We were also successful in renegotiating with the leasing companies of our old leases amounting to $ 25 million.
“Consequently, we were able to save Rs. 8,250 million by reducing our lease payments. For the first time in the history of Sri Lanka, we are making our payments in advance when purchasing fuel from the Ceylon Petroleum Corporation (CPC). Over the past eight months, we have stopped relying on the Government for funding, because the Government has requested SriLankan Airlines to be self-sufficient. As of now, for the first time in 16 years, Sri Lankan Airlines was successful in recording a profit of $ 1.7 million (Rs. 553 million) during the fourth quarter of FY2021.”
D.V. Chanaka defends decision to acquire new airplanes
20 Apr 2022
D.V. Chanaka defends decision to acquire new airplanes
20 Apr 2022