NATIONAL 5 (Spotlight Weekly)]

Hazy Deal

The RNAC's decision to buy ATR-72 aircraft is mired in controversy

By KESHAB POUDEL

At a time when Royal Nepal Airlines Corporation (RNAC) is facing difficulties in continuing its domestic flights in Short Take Off and Landing (STOL) airports in remote areas due to ageing twin-otters, the management is now planning to purchase two aircrafts for trunk route where competition is tough among private airlines.

With the intervention of the Public Accounts Committee (PAC) of the House of Representatives, RNAC has temporarily suspended the purchase of two French built ATR-72\500 series of aircraft. But the question remains: is it the final and proper solution.

RNAC's fleet : Inadequate

Signing of Memorandum of Understanding (MoU) between Avions de Transport Regional, G.I.E. and RNAC in respect of the sale and purchase of two ATR-72-500 aircrafts has been withheld. Had the PAC not intervened, the first aircraft would have been delivered to RNAC in October, 2000 and the second in December, 2000.

RNAC needs turbo propelled aircrafts to make its domestic service reliable and punctual but no body seems to be bothered about which aircraft would be technically and economically best for the national flag carrier.

Strangely, the PAC has not given the reason why it stalled the process. It has not clearly mentioned any technical or financial inadequacies in the deal. Likewise, RNAC, too, has not made any efforts to justify why ATR-72\500 are technically and financially suitable to its fleet.

Even the feasibility study sub-committee formed to recommend the alternative aircraft did not justify its recommendation why RNAC needed 70 seater turbo prop aircraft?

The four-member Domestic and International Aircraft Purchasing Re-evaluation Sub-committee led by member of the RNAC board of directors Rameshwor Prasad Khanal had recommended ATR-72.

Set up on May 10, 2000 by the RNAC's board, the committee included Murari Bhakta Mathema, Acting Director of Quality Assurance and Flight Safety, Capt. Binaya Kumar Shrestha, Chief Pilot at Operations Department and Pushkar Prasad Wagle, Acting Deputy Director among its members. They evaluated the recommendation report that was submitted to the board on 2 February, 2000.

As the policy-makers were for some reason, preoccupied with the purchase of aircraft, no body deemed it necessary to make public the technical capabilities and sustainability of the said aircraft.

"It is true that RNAC needs new aircraft to replace its ageing fleet of twin-otters and Avro," said a civil aviation expert. "But can ATR-72\500 be economical and technically viable to replace them?" he asked.

RNAC's management, however, defends its decision. "ATR-72/500 is technically and economically viable for RNAC and it is in accordance with the demand forecast," said Hari Bhakta Shrestha, Chairman of RNAC. "Various committees and sub-committees formed by RNAC's board recommended the ATR-72 series arguing that it is technically and financially viable."

But the studies conducted by private airlines on demand forecast speaks otherwise. According to a domestic market study report conducted by private airlines, the occupancy rate of existing private aircraft is less than 50 percent even on 25 percent reduced fare in trunk routes like Biratnagar, Nepalgunj, Bhairahawa and Pokhara.

Others argue that 70 seater ATR-72 requires longer runways and it could not be operated in Pokhara which is the source of 50 percent of foreign currency earnings to the airlines. Thus, it is impossible to strike a break-even without operating in Pokhara.

Even the length of the aircraft will be of concern for landing and take-off of ATR in Pokhara. The length of ATR-72 is 89 ft 2 inch compared to the length of ATR-42 which is 74 ft 5 inch.

Luring the passengers will be another difficult task for such a large seater turbo aircraft. As private airlines have frequent flights, it will be very difficult to fill the 72 passengers in RNAC's aircraft in its once a day flight. "No one would criticise RNAC had it ordered for medium range ATR-42 aircraft," said an aviation expert.

Weight, Altitude and Temperature (WAT) determine the performance of the aircraft. In Nepal, the variety in temperature and altitude restrict the pay load of an aircraft.

Nepal's four trunk route airports have different length and altitude as Pokhara Airport has 4,700 ft long runway and is situated at the altitude of 2,800 ft above sea level. The lengths of runways at Biratnagar, Bhairahawa and Nepalgunj are 5000 ft each and their altitudes are at 235 ft, 358 ft and 600 ft respectively. The outside temperature is also different at these airports as the temperature of Nepalgunj, Bhairahawa, Pokhara and Biratnagar are 45, 38, 35 and 38 degrees celsius respectively.

"The temperature and altitude can make difference in the pay load capacity of the aircraft," said an aviation expert. According to the weather theory, higher the elevation lower the temperature. It is said that the temperature should recede by 2 degree celsius per every 1000 ft ascent from sea level. According to the International Standard Atmosphere (ISA), the temperature of sea level should be 15 degree celsius. But the temperature of Nepal's airports are different from what is specified by metrological theory.

In Pokhara, an aeroplane like ATR-72 can hardly turn in full load as the mountains in its northern side is going to be a major obstruction for the take-off.

The RNAC management defended its decision saying that it was taken under the recommendation of nine member committee set up early this year which suggested the ATR aircraft for trunk route in replacing 44 seater Avro.

In search of 50-70 seater Turbo Prop aircrafts for the airlines, the committee analyzed the initial technical information for 12 different aircraft including ATR 72-500, ATR 42-500, EMB 120 ER, DASH8-100, DASH8-200, DASH8-300, DASH8-400, SAAB 340B, SAAB 2000, CN 235-300, DORNIER 328-120 and Y7-100.

Finally, the committee short-listed 6 aircraft including ATR 42-500, ATR 72-500, DASH 8-300, DASH 8-400, SAAB 2000 and Y7-100 which fulfilled the requirements proposed by RNAC's technical and marketing department.

According to the report of RNAC's Aircraft Purchasing Feasibility sub-committee for domestic flights presented in January 2000, the technical validity of 6 short-listed aircrafts analyzed under the 15 basic criteria like brand new was aircraft, 50-70 seat capacity, minimum 30" seat pitch, wing position and vision, total number of manufacture and regional support, one minimum toilet, wheel base, number of wheels, landing gear position, certifications, Cargo hold (Space, Capacity and provision), Runway performance certification, Paro Airport performance, CVR, FDR, TCAS, Emergency locator, transponder etc and IFR approval.

This committee headed by board member Shankar Prasad Koirala included almost all senior officials of RNAC including representatives from Civil Aviation Authority of Nepal (CAAN) as its members.

Finally, the Koirala sub-committee selected four aircraft ATR 42-500, ATR 72-500, DASH 8-300, DASH 8-400 on the basic criteria. One of the reasons for the demand of such aircraft is to operate mountain flights. On the basis of cost of operation and unobstructed window, ATR 72-500 has no match, the report says.

Analyzing the cost effectiveness, the sub-committee recommended ATR-72 aircraft saying it has the lowest per seat investment cost, operating cost per block hour, annual profitability, profitability of per block hour and regional compatibility. According to the sub-committee, the aircraft is also technologically proven with maintenance and training facilities available in the region.

Interestingly, all committees have endorsed the proposal of 1993 committee which had recommended ATR-72 as the alternative despite the fact that the plane could not operate conveniently in major trunk routes.

As far as mountain flights are concerned, ATR-42 has 26 unobstructed windows vision compared to 42 in ATR-72. In terms of cargo and passenger carrying capacity, the aircraft's per seat investment cost is lower than others. The total cost of ATR-72 is 16.9 million US dollars. The per seat investment cost is 0.2485 million US dollars. The operating cost per block hours is 1,958.3 US dollars against 1,697.4 US dollars of ATR-42.

As Royal Nepal Airlines Corporation's (RNAC) initiative to purchase aircraft is stalled, no one is coming forward to clarify the details regarding the move (to stall it) and why ATR 72 is the best option in a given situation.