In spite of the International Air Transport Association reporting global losses for the airline industry up to US$314 billion (K1086 billion), Papua New Guinea’s carriers are keeping essential services going under the toughest business conditions.

Credit: Air Niugini

For months now, airlines around the world have been bleeding money. Most are almost totally grounded because of the COVID-19 crisis and most have shed their workforce, either through redundancies, stand downs or enforced leave.

PNG’s airlines – the government-owned national carrier Air Niugini and the smaller PNG Air – have not been immune from the groundings.

The Chief Executive Officer of PNG Air, Paul Abbot, has already stated that the airline’s revenue has plummeted to 10 per cent of what the company would reasonably expect to generate on a daily basis.

Fighting for survival

Abbot said PNG Air, which creates jobs for more than 1000 people, is in a fight for survival and that the airline has approached the government for support.

In an open letter to staff, he wrote: ‘The aviation sector is a vital cog in the ongoing development of PNG and forms a vital lifeline for many communities.

‘We have made this request (for government support) on behalf of the 796 direct employees of the airline, the 250 indirect employees … and on behalf of more than 2600 shareholders (almost all of whom are Papua New Guinean or PNG entities).’

‘Air Niugini has carried more than 100 tonnes of supplies on Dash 8 Combi aircraft, capable of carrying 2.5 tonnes of cargo per flight.’

Abbot told Business Advantage PNG: ‘We remain hopeful that the schedule will free up as restrictions ease and we are able to get aircraft operating again and get staff back to work, but all that at this stage is out of our control.’

Air Niugini said in a statement that its revenue reductions are being partially offset with lower fuel, maintenance and operating costs as a result of reduced activity.

Both airlines are operating limited domestic services for passengers and cargo to most ports in PNG, with the exception of border ports.

There have been some reports that Air Niugini’s reduced domestic flights are carrying only 10 to 20 passengers who must wear masks. In addition, the middle seat in Fokker aircraft is being left empty.

Air Niugini’s international schedule is also severely curtailed.

‘We are currently only operating to Cairns, Brisbane and Singapore, but have cut down on the frequencies and selectively using smaller-capacity aircraft in some cases,’ the airline said last week.

The international outbound flights can carry passengers and cargo, but the inbound flights carry only cargo, unless the passengers are essential workers or critical personnel to tackle coronavirus issues.

Air Niugini’s suspended international flights include Sydney, Honiara, Nadi, Port Vila, Manila, Tokyo, Hong Kong, Pohnpei and Chuuk.

Angels in the sky

PNG Air’s Paul Abbot. Credit: BAI

Despite the turbulent air, both airlines have stepped up to deliver essential cargo across the country, including medicine.

Since 25 March, Air Niugini has carried more than 100 tonnes of supplies on Dash 8 Combi aircraft, capable of carrying 2.5 tonnes of cargo per flight.

‘We have delivered PPEs (personal protective equipment ) and medical goods to provincial health authorities in Buka, Rabaul, Kavieng, Hoskins, Manus, Daru, Lae, Madang, Wewak, Vanimo, Popondetta, Goroka and Mount Hagen,’ the airline said.

‘The freight to Hagen also included PPEs for other highland provinces, including Enga, Southern Highlands and Jiwaka.

‘Some provinces made use of the freighter service  by including other essential drugs for TB [tuberculosis], malaria and HIV/Aids. Air Niugini also transported COVID-19 test samples from the provinces to the PNG Institute of Medical Research in Goroka, as well as security personnel including soldiers and police to monitor and beef-up security at the border provinces.

‘For international operations, Air Niugini has been operating a Boeing 767 to carry medical supplies and equipment as well as much needed food supplies to keep the economy going.’

Abbot said PNG Air has transported medical supplies, perishable goods and people essential in the battle with COVID-19.

‘It is vital to the health of the nation that we combat COVID-19 and we are therefore working closely with the SOE (state of emergency) Controller to assist in the movement of people and freight essential to this battle,’ he adds.

Trouble in the neighbourhood

Credit: Qantas

Australian airlines Virgin Australia and Qantas, which usually fly into Port Moresby, are having troubles of their own.

In the case of Virgin Australia, the company has been placed into voluntary administration.

Qantas is operating at 5 per cent of its pre-crisis domestic capacity and around 1 per cent internationally. Last week, it announced it will extend its domestic cancellations beyond the end of May to the end of June, while international cancellations will be extended until the end of July.

‘IATA said that 97 per cent of its 290 member airlines expect a deterioration, or no improvement, in profitability in the next 12 months.’

Meanwhile, the International Air Transport Association (IATA), which is the trade association for the world’s airlines, has estimated that airline revenues in 2020 could nosedive by US$314 billion (K1086 billion). It’s further estimated that 4.5 million flights around the world will be cancelled by 30 June.

An Airline Business Confidence Index released recently by the IATA said that 97 per cent of its 290 member airlines expect a deterioration, or no improvement, in profitability in the next 12 months.