Debt burden rises as SriLankan Airlines delays return of aircraft

Debt burden rises as SriLankan Airlines delays return of aircraft

By Keshala Dias

12 Jul, 2017 | 11:23 pm

Over the past few days, News 1st exposed that, Sri Lanka’s national carrier, Sri Lankan Airlines, had failed to return an Airbus A320 Aircraft to an Indian company, Air IndiGo airline.

News1st sought further clarification from the airline today, for the delay, which has caused a massive loss to the country.

As of yesterday, the cost for the rental for this aircraft had reached a total of USD 768,000 (Rs. 119 million), which represents USD 12,000 for each day the aircraft is not returned to the lessor.

Today, increases the amount owed to USD 780,000 which is a straggering Rs. 120.9 million.

When inquired by News1st yesterday, SriLankan Airlines said two lateral cockpit window panel frames of the aircraft required to be replaced due to metal fatigue.

The airlines’ statement mentioned two options for the repair work.

1. Outsource to a working party from Airbus at an approximate cost of USD 1.7 million.

2. To carry out the repair in-house at a cost of USD 500,000.

The airline said it chose the second option, as it was a saving. However, with the penalty payment now at USD 780,000, option two has more than doubled to USD 1.28 million.

Yesterday, SriLankan Airlines informed Newsfirst that the Airbus was sent to a company called GMF AeroAsia based in Indonesia for a complete paint event of the full aircraft.

When inquiries were made today, for more information on its current whereabouts, SriLankan Airlines said the aircraft was sent to Indonesia on the 16th of April and was returned on the 19th of May.

When questioned, why the aircraft is still in Sri Lanka and has not been returned to the lessor, the airline responded:

[quote]”The major repair that was performed under Airbus supervision needs more repair work and that this will delay the output by several days”.[/quote]

It added that the aircraft would be returned to the lessor within the next fourteen days, as soon as Airbus confirms the repair work is a success.

This additional fourteen days will cost a further USD 168,000, which now adds up to USD 1.448 million.

According to SriLankan Airlines, the cost for GMF to perform the paint job on the aircraft, was approx. USD 75,000.

However, due to the delay and paint quality, the airline has withheld part of the payment and have started a warranty claim.

Nevertheless less, the figure now stands at USD 1.523 million, a mammoth payment exceeding Rs. 236 million.

Who is responsible for this colossal cost to be bourne by the public?

Does this not call for an internal audit?