Home ยป The financial troubles at Pakistan International Airlines are causing problems for Canadian travelers.

The financial troubles at Pakistan International Airlines are causing problems for Canadian travelers.

Upon hearing about the financial difficulties of Pakistan International Airlines, Shakil Meenai from Edmonton immediately felt the urge to verify the current situation of his upcoming domestic flight from Lahore to Karachi.

Meenai, who is 60 years old, intends to visit Pakistan, his country of origin, in the middle of October. This is an annual trip for him.

He made the choice to make a reservation with the national airline of Pakistan for his brief journey between the two cities in Pakistan.

Meenai’s flight from Lahore to Karachi was cancelled and rescheduled for a flight seven hours later without him being informed.

“I was not given any notice or informed about this action,” Meenai expressed in an interview with CBC. “Other airlines would inform you even if there is a minor change in the flight schedule, such as a delay of 10 or 15 minutes.”

PIA, the national airline of Pakistan, recently started reducing its activities due to accumulating unpaid bills and lessors’ attempts to prevent the carrier from operating their planes until it settles its outstanding payments.

Shakil Meenai wearing a hat and sunglasses
Shakil Meenai claims that due to his previous encounters with sudden cancellations of domestic flights by Pakistan International Airlines, he would never contemplate traveling on an international flight with them. (Submitted by Shakil Meenai)

According to ch-aviation, a Swiss airline intelligence agency, the request for an emergency bailout of approximately $100 million made by the airline was declined by the Pakistani government. Instead, they instructed the state-owned carrier to obtain loans from commercial banks.

During this period, there is a high demand for travel among Canadians who wish to reunite with their loved ones in Pakistan. The weather conditions are typically pleasant, and it coincides with a popular time for weddings as well.

However, passengers are opting for alternative airlines as they perceive PIA to be unreliable.

PIA does not fly out of Edmonton International Airport. The airline does offer direct flights to several Pakistani cities from Toronto’s Pearson International.

According to Meenai, people are opting for alternative airlines due to cancellations, delays, expensive tickets, and unsatisfactory customer service.

Meenai stated that the individuals who travel internationally with PIA, particularly from Canada, are primarily either those who prefer not to transit through other countries or older individuals.

Based on the 2021 census conducted by Statistics Canada, approximately 40,000 individuals residing in Alberta self-identify as Pakistani.

In August, the Pakistan government revealed intentions to privatize the airline due to its extensive financial losses amounting to billions of rupees.

Hamed Ghanbari, a finance professor at the University of Lethbridge, said PIA has five times more liabilities than assets.

Ghanbari stated that it is challenging to address a sovereign debt crisis and political uncertainty while considering the possibility of resolving the issues through a government bailout.

He stated that upon analyzing the underlying causes of these situations and considering their overall financial condition, he does not foresee any resolution in the near future.

Ghanbari suggested that privatization could be considered as an alternative solution to address the financial difficulties faced by the airline.

He expressed that it could potentially be the resolution for them to consistently achieve a financial equilibrium and avoid being caught in this predicament.

He stated that PIA’s situation is distinct from that of a struggling commercial airline in North America or Europe.

Once they become aware that this venture is not generating profits, they attempt to allocate resources strategically in order to either ensure their survival or seek protection.

Considering the existing exchange rates and the fact that [PIA] primarily operates based on unfulfilled demand, it presents a challenging circumstance.

‘A sour taste’

CBC News reached out to PIA twice for a comment but received no response before the article’s deadline.

Salman Naseer, the president of the Pakistan Canada Association of Edmonton, mentioned that in the past, PIA used to offer excellent service. However, as time passed, he has encountered numerous negative experiences shared by community members who chose to travel with the airline.

Naseer stated that individuals have the consumer’s privilege to make fair comparisons. If one is paying a significant amount to an airline and one airline offers more services in comparison to another, it will undoubtedly leave a negative impression.

A man wearing a suit and tie smiles for the camera.
Salman Naseer, the president of the Pakistan Canada Association of Edmonton, has been receiving more and more complaints about PIA’s service from members of the community. (Submitted by Salman Naseer)

Karl Moore, an associate professor of strategy and management at McGill University, stated that it is a challenging decision for any airline to reduce their services.

He mentioned that factors such as reputation are involved.

“PIA holds a prominent position within Pakistan, making it the leading player. Hence, the entire population of the country is well-informed about their activities,” stated Moore.

The reason you engage in such actions is primarily due to being compelled by difficult situations. It is not something you undertake casually, that’s for sure.

Source: cbc.ca