7 companies vie to lease aircraft for NAC

Photo Courtesy: Nepal Airlines Corporation


Nepal Airlines Corporation (NAC) is in the process of leasing two Airbus narrow-body aircraft for its international operations, with seven companies expressing interest in the endeavor. The sought-after aircraft, Airbus A320-200 series, are intended to bolster NAC’s fleet capacity, accommodating 158 seats for passengers.

According to NAC Spokesperson Ramesh Paudel, the corporation had solicited proposals for the leasing initiative, receiving applications from seven companies by the deadline last Friday. However, Paudel refrained from disclosing the identities of these applicants at this stage, citing concerns about undue pressure.

The evaluation process for the proposals is expected to take approximately a month. Technical and financial assessments will be conducted to determine the most suitable company for the leasing agreement, ensuring compatibility both technically and financially.

A sub-committee, led by Kishor Pradhan, a member of NAC’s board of directors, has already conducted a study on adopting wet lease arrangements, which involve renting aircraft along with crew. Based on the findings, NAC decided to seek public proposals for the leasing of two narrow-body aircraft.

The addition of these aircraft is poised to enhance NAC’s flight operations, particularly to lucrative destinations such as Malaysia, Delhi, Saudi Arabia, and the United Arab Emirates (UAE). Furthermore, NAC aims to expand its reach to long-distance destinations like Japan and Australia with its existing widebody fleet.

Financial projections suggest that leasing an aircraft at an estimated cost of $3,000 per hour could lead to profitable operations for NAC. The corporation’s narrow-body aircraft, with a seating capacity of 158, have been generating significant annual revenues, surpassing operating expenses by considerable margins.

In the current fiscal year, NAC anticipates earning over Rs 9 billion from its narrow-body aircraft operations, with a projected annual profit exceeding Rs 1.3 billion after accounting for expenses. Looking ahead, NAC envisions a profit surge in the next five years, with narrow-body aircraft operations alone expected to contribute significantly to the corporation’s financial growth.