I’ve frequently argued that Pakistan International Airlines is the worst airline in the world. But what’s finally got the government’s attention isn’t sacrificing a goat for safety or flying with more passengers than seats (and making customers stand for 1700 miles).
Boeing 777 on Approach to New York JFK in 2014, Copyright zhukovsky / 123RF Stock Photo
Instead there’s now a corruption probe over a wet lease deal with SriLankan in which PIA spent $19 million to lease an Airbus A330 for 6 months in ‘the most profitable deal SriLankan ever had’.
Pakistan International Airlines used the plane and SriLankan crew to offer a proper service between Islamabad and London Heathrow, losing $14 million during the brief lease.
Now interim Pakistan CEO Bernd Hildenbrand isn’t being permitted to leave the country (the head of an international airline cannot fly abroad!) while the nation’s Federal Investigation Agency investigates kickbacks and embezzlement in the deal, on belief that PIA paid twice the going rate to lease the aircraft.
Of course PIA paid not just for the plane but also for the crew with the Prime Minister of the country championing the deal which would finally provide good service on a flagship route.
“The prime minister himself gave the go-ahead for the high-end premier class service to lift Pakistan’s image in foreign countries . . . To launch that new brand, it was important to get quickly planes with well-trained crew and that is what the CEO precisely did.”
Asserting corruption at PIA, though, is sort of like suggesting predeparture beverages in American Airlines first class are optional or that the price of a Delta SkyMiles award ticket could change at any moment.
As I’ve noted, “When PIA employees are forced to overnight passengers at a hotel at the airline’s expense, the employees earn kickbacks from those hotels.”
Nonetheless, corruption charges themselves are often wielded in Pakistan for their own corrupt purposes, and Hildenbrand points out that he wasn’t even acting CEO when the SriLankan deal went down, and the arrangement was approved by the airline’s board of directors.
His management style and efforts to avoid doing favours for influential people — such as hiring more employees for the overstaffed carrier — irked many in Islamabad.
Mr Hildenbrand refused to “return phone calls unlike other CEOs in the past who immediately returned phone calls to members of parliament and the cabinet”, one opposition politician complained in December.
This isn’t even the first time that PIA’s acting CEO has been barred from leaving the country. In December he was detained in Pakistan when the airline “sold a flight-worthy aircraft (A-310) to a German museum at throwaway price.” The insinuation is that the acting CEO really bought the plane for himself. Oh, and the interim CEO’s Visa has apparently expired too.
How politicized is running of the airline? Hildenbrand is not even permitted access to the airline’s engineering department or hangars because the state’s security agencies haven’t given him clearance.
Imagine if any time investors questioned moves by United and American if Doug Parker and Oscar Munoz could risk criminal prosecution.