No government kept commitment on SriLankan Airlines, says industry veteran

by Sanath Nanayakkare

The situation in SriLankan Airlines has deteriorated to its present level as successive governments failed to keep the commitment they had stated publicly, to turn around the struggling airline with necessary reforms, veteran aviator Capt. Milinda Ratnayake said.

He made this remark at a webinar hosted by Advocata Institute recently, with a view to promoting sound policy ideas for Sri Lanka.

Capt. Ratnayake’s illustrious career has spanned over 40 years in Air Ceylon, Air Lanka and SriLankan Airlines, and he has clocked over 15,000 hours of flying passenger aircraft, Besides his flying career, he possesses a wealth of managerial experience in the aviation industry.

“We are an island nation. So we do need an airline because we can’t always ask for help from neighbouring countries in emergency times or for other vital aviation needs. And we do need an airline for Sri Lanka Tourism too. But the question is how do we run our airline without making it a burden on the national economy, or at least at a breakeven if profits can’t be made. I know that all the governments in the last few decades came to power with an avowed commitment to turning SriLankan Airlines into a profitable organisation. A new government would come and appoint a new chairman, a new CEO, a new marketing team etc and they get the ball rolling to run things efficiently and productively. And then after sometime the government would come and say that they want the Airline to go to a new destination, and the Airline’s management team is back to the drawing board because they can’t refuse a request made by the government even though it is not a sound request in terms of business. This sort of government interventions have been the main and constant source of discontinuity in prudent operational management of the Airline.”

Responding to a question whether Tim Clark, the legendary managing director of Sri Lankan Airlines (when a 40% stake in SriLankan Airlines was owned by Emirates) knew a secret or two to run an airline profitably, Capt. Ratnayake replied, “During that time the board had appointed qualified personnel who could find employment anywhere in the world. Tim Clark would personally oversee the purchase of a new plane for the fleet. SriLankan Airline Board once decided to purchase four or five A350 aircraft without seeking the views of Finance, Engineering, Flight Operations, Sales, Cabin Crew etc. to ascertain all aspects of the viability of the purchase. When a TriStar was purchased during Capt Rakitha Wickramanayake\s time, the decision went through five committees to study whether the specifications of the plane would align with the purpose of purchasing it.”

“Four years ago, we decided to start flights to England, Germany, France and several other European destinations and each of these flights incurred a loss of USD 10,000. How can we run an airline sustainably on such an ad hoc model?

“An airline can’t be run on one’s whims and fancies. It has to have a proper a return on investment (ROI) plan. Even a men’s barbershop has one,” he said.