PIA will be angling for some immediate headway from its return to the UK sector. The national airline is working on an ambitious turnaround plan. Image Credit: Agency

Dubai: Pakistan International Airlines (PIA) flights to the UK have made a return, but air fares on the sector will need more time to settle.

“Airlines are trying to make up for lost money - the PIA having extra routes may not translate into lower fares," said Fahad Masood, an aviation analyst. “For about another six months, ticket prices will remain towards the higher side.

“It will take time to have a trickle-down effect but, yes, options for travellers will certainly open up and dependency on hub travel will be reduced.”

PIA was barred from flying to the UK - and to European Union member-states - after it was found that a large number of Pakistani pilots held ‘dubious’ commercial pilot licenses. The restrictions were recently withdrawn by UN aviation agency ICAO, signalling the return of Pakistan flights to Europe, the US and UK.

The flagship carrier will begin operating flights between major Pakistani cities and London in February, according to the airline’s website. Bookings for London-bound flights from Karachi and Lahore are open from February 10. Flights from Islamabad will start February 12.

The airline is charging in the range of Dh1,500-Dh1,700.

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Turnaround plan

The resumption of flights to key international markets might just be the boost PIA needs to get back on track after a dismal few quarters. The airline announced plans to further cut its workforce as part of reforms to make the airline’s operations efficient and return to profitability.

PIA’s CEO Arshad Malik said the reform process would continue as it had helped in significantly bringing down the employee per aircraft ratio to 260 from 550 in 2017. The reforms would help PIA “save around Rs8 billion (Dh166 million) annually with the reduction of its staff strength”, the CEO said, adding that the key elements of the restructuring process were enforcing discipline and improving services to bring the airline at par with international standards.

PIA, which reported a loss of Rs42.3 billion in the third quarter of 2021, had about 93 per cent share on the non-stop market between Pakistan and the UK, driven by strong point-to-point demand from VFR (visiting friends and relatives) and business travel segments, said Linus Benjamin Bauer, Managing Director at Bauer Aviation Advisory.

“However, the market environment has changed during the pandemic when PIA lost the rights to operate to Europe and the US due to safety-related concerns. British Airways and Virgin Atlantic jumped in and gained a stronger foothold on the Pakistan-UK market to date.”

Challenging conditions

As far as airlines are concerned, the UK-Pakistan route is not particularly lucrative and this means airlines need to operate at impossibly low costs. “Since this market is heavily driven by VFR demand, fares are not particularly high,” said Bauer. “VFR markets are renowned for lower yields, reflecting a high proportion of passengers flying mostly economy.”

Although airlines have to contend with challenging circumstances, Gulf airlines might be better suited to create opportunities in this sector. “It could benefit Emirates airline, Etihad Airways and Qatar Airways to step in with more attractive fares, increasing the 35 per cent market share on international seats offered from Pakistan back in 2019,” said Bauer.