David Knibb
While Papua New Guinea's government ponders whether to accept Qantas Airways' offer to take over management of Air Niugini, the ailing PNGcarrier is slashing international services in an effort to stem its losses.
PNG's prime minister Bill Skate has asked Qantas to manage government-owned Air Niugini and take a 25 per cent equity stake in it. Qantas submitted its management offer to PNG's minister for transport and civil aviation in late March. Although no specifics about the deal have been released, Qantas was expected to propose that it appoint Air Niugini's entire senior management, including a managing director seconded from Qantas.
It is unclear why PNG has not acted on the Qantas offer in over a month. Air Niugini officials, who say the management takeover is a government decision not an airline one, suggest it is because PNG's cabinet is in the midst of its own reshuffle, with a new ministry likely to assume the aviation portfolio.
Chris Mek, Air Niugini's acting managing director, does not feel the airline can wait for outside help. His internal restructuring calls for laying off almost a third of the airline's employees.
Further restructuring steps have been to cut back on international services. In April, after traffic fell to an average of less than 25 passengers per flight, Mek suspended all Osaka flights. At the end of May, Air Niugini was due to suspend all services to Hong Kong and Sydney and cut Manila frequencies from two to one flight per week, leaving Singapore, Cairns and Brisbane as its only international destinations.
Source: Airline Business
