Is SriLankan Airlines On The Verge Of Collapse? [OMaaT]

[SYD]

I just noticed this on social media. Anyone doing the cheap runs ex-MEL/SYD any time soon might want to consider a Plan B?

Is SriLankan Airlines On The Verge Of Collapse?

The government is trying to privatize SriLankan Airlines, but there's reportedly no interest. This isn't going to end well...

onemileatatime.com

 

[docjames]

Its a very speculative article.

What is probably doesn’t emphasise enough, is the difficult financial situation the Sri Lankan government is in - the country has been in an economic crisis pre-dating COVID (but worsened in that context). There were already IMF bailouts in 2009 and 2016 and then approval in 2023 for more bailout.

Offloading a loss making national carrier would be one way to stem the losses, but trade that off that inbound tourism is a significant part of the Sri Lankan economy so if privatised and loss making routes are cut, that may impact inbound tourism volumes.

 

[SYD]

Its a very speculative article.

What is probably doesn’t emphasise enough, is the difficult financial situation the Sri Lankan government is in - the country has been in an economic crisis pre-dating COVID (but worsened in that context). There were already IMF bailouts in 2009 and 2016 and then approval in 2023 for more bailout.

Offloading a loss making national carrier would be one way to stem the losses, but trade that off that inbound tourism is a significant part of the Sri Lankan economy so if privatised and loss making routes are cut, that may impact inbound tourism volumes.

The article touches on the first aspects (which ought to be well known?) and the official statement could be a bluff but if there’s no more money then it won’t be the first “national carrier” to go down the drain.

Hopefully not but it’s a bit like a run on a bank. If peeps cotton on that their flights are at risk of being cancelled or worse potentially lose their money, they won’t book. Thus the downward spiral accelerates.

 

[wandering_fred]

SriLankan Airlines flying through Turbulence – CEO Richard Nuttall - Opinion | Daily Mirror

Tourism in SL

Not an easy situation in SL. But as usual there are many sides to look at and only a few are regularly reported. Yes I have friends who are SL citizens and live in country.
Perhaps that is why it is a regular destination in my past wandering
Fred

 

[moa999]

If I remember way back EK had bought a stake.

Searching.. EK bought a 43% stake in 1998 taking over management over Air Lanka and rebranding it to Sri Lankan.

They sold out in somewhat acrimonious circumstances 10yrs later after the govt forced out the EK appointed head over ticketing issues for the Sri Lankan PM and entourage.

 

[clifford]

They sold out in somewhat acrimonious circumstances 10yrs later after the govt forced out the EK appointed head over ticketing issues for the Sri Lankan PM and entourage.

Says it all, I think. Many of Sri Lanka's ills are politically caused.

 

[jrfsp]

Its a very speculative article.

What is probably doesn’t emphasise enough, is the difficult financial situation the Sri Lankan government is in - the country has been in an economic crisis pre-dating COVID (but worsened in that context). There were already IMF bailouts in 2009 and 2016 and then approval in 2023 for more bailout.

Offloading a loss making national carrier would be one way to stem the losses, but trade that off that inbound tourism is a significant part of the Sri Lankan economy so if privatised and loss making routes are cut, that may impact inbound tourism volumes.

Up until now UL has been "loss making" and its operations funded through the government, but now the SriLankan government has little money to pour into UL and the vanity project needs to end. Hopefully capacity loss can be made up with other carriers increasing flights to CMB.

Ive had many a good flight on UL and their crews were fantastic but the carrier has become too unreliable and less and less people are booking with them as a result which only worsens their likely demise.

 

[SeatBackForward]

if this were to happen, then oneworld is sorely lacking representation around the subcontinent.

 

[wandering_fred]

Last 90 days Oanda is reporting that the Lankan rupee has gone from 1US$=326 to 1US$=308
A minor correction perhaps, but will help in repaying the US$ debt on the airplanes
They would like more people wandering
Fred