Navid Ali Report

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Internship Report on

Pakistan International Airline Corporation(Peshawar station)

Internship Report submitted to the UNIVERSITY OF

MALAKAND in partial fulfillment of the requirements for

the degree of MBA in Finance.

SAMI UL HAQ

&

NAVID ALI

Session 2011-2012

Submitted To:

Dr. ARSHAD ALI

DEPARTMENT OF MANAGEMENT STUDIES

UNIVERSITY OF MALAKAND


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Dedication

Dedicated

To

Our Dear Parents,

Respected Teachers

&

Lovely Friends


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Table of Contents

Dedication ....................................................................................................................................... 2

Preface............................................................................................................................................. 7

Acknowledgement .......................................................................................................................... 8Executive Summary ........................................................................................................................ 9

Chapter: 1 ...................................................................................................................................... 10

Introduction ................................................................................................................................... 10

Purpose of the Study: ................................................................................................................ 10

Scope of Study: ......................................................................................................................... 10

Objectives of the Study: ............................................................................................................ 10

Limitation of the Study: ............................................................................................................ 11

Methodology for collection data: .............................................................................................. 11

Company introduction ............................................................................................................... 11

History ....................................................................................................................................... 12

Pre-Independence .................................................................................................................. 12

Post-Independence ................................................................................................................. 13

1970s ...................................................................................................................................... 14

1980s ...................................................................................................................................... 16

1990s ...................................................................................................................................... 16

2000s ...................................................................................................................................... 17

European Union Ban ............................................................................................................. 18

Current decade ....................................................................................................................... 19

CHAPTER: 2 ................................................................................................................................ 20

Corporate Management ................................................................................................................. 20

Structure .................................................................................................................................... 20

Privatization .............................................................................................................................. 20Financial performance ............................................................................................................... 20

Chairman of PIA ....................................................................................................................... 22

Destinations ............................................................................................................................... 23

Domestic Net work24 Destinations....................................................................................... 24

International Network - 36+2 Destinations ............................................................................... 25


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Code share agreements .............................................................................................................. 26

Vision ........................................................................................................................................ 26

Mission ...................................................................................................................................... 26

Corporate Values ....................................................................................................................... 26Achievements and recognitions ................................................................................................ 27

Fleet ........................................................................................................................................... 28

Hierarchy of PIAC Management............................................................................................... 29

Chapter: 3 ...................................................................................................................................... 30

Departments of PIAC .................................................................................................................... 30

Network & Route Planning Department ................................................................................... 30

Administration Department ....................................................................................................... 30

Finance Department .................................................................................................................. 31

Marketing Department .............................................................................................................. 31

Engineering Department ........................................................................................................... 32

Flight Operations Department ................................................................................................... 32

Airport Services Department ..................................................................................................... 33

Passenger Services Division .................................................................................................. 33

Flight Services Division ........................................................................................................ 33

Coordination Department .......................................................................................................... 33

CHAPTER: 4 ................................................................................................................................ 34

Finance Department of PIAC........................................................................................................ 34

Function of Finance Department ............................................................................................... 34

Planning ................................................................................................................................. 34

Budgets .................................................................................................................................. 34

Controlling ............................................................................................................................. 35

Department of Finance .............................................................................................................. 35Revenue Division ...................................................................................................................... 35

A. Passenger Revenue: .............................................................................................................. 35

Direct Sale ............................................................................................................................. 36

Passenger Revenue/Extra Baggage Carrier Ticket: ............................................................... 36

Miscellaneous charges order (MCO): .................................................................................... 36


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Prepaid Ticket Advice (PTA): ............................................................................................... 36

Agency Sales: ........................................................................................................................ 37

Refund Unit: .......................................................................................................................... 37

Accounting Unit: ................................................................................................................... 37B. Cargo Revenue Section ........................................................................................................ 38

Sales Unit:.............................................................................................................................. 38

International Revenue Section: ................................................................................................. 39

Receivable: ............................................................................................................................ 39

Payable: ................................................................................................................................. 39

Pricing .................................................................................................................................... 39

Our Work Experience in PIAC Islamabad ................................................................................ 40

There Are Different Types of Reports in Which Different Type of Sale Are Reported ........... 40

International Pax Sale................................................................................................................ 40

International Cargo Sale ............................................................................................................ 40

International Pax Sale................................................................................................................ 42

DSAs: Domestic Sale Agents............................................................................................... 42

IATA Agents ......................................................................................................................... 42

GSA: General Sales Agents ................................................................................................... 42

International Cargo Sale ............................................................................................................ 42

Revenue Department ................................................................................................................. 43

Cash Sale ............................................................................................................................... 43

Credit Card Sale..................................................................................................................... 43

Sale to Defense Personals ...................................................................................................... 43

Incentive Tickets to Different Clients ................................................................................... 43

Staff Rebated Tickets ............................................................................................................. 44

Collection of all sales proceeds at the counter ...................................................................... 44Documents Control Section ...................................................................................................... 44

Serial Control Section ............................................................................................................ 45

Agency Sales Unit ................................................................................................................. 45

Refund Section .......................................................................................................................... 45

Disbursement Section ................................................................................................................ 46


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Preparation of Pay Vouchers ..................................................................................................... 46

CHAPTER: 5 ................................................................................................................................ 48

SWOT Analysis ............................................................................................................................ 48

Introduction ............................................................................................................................... 48Strengths .................................................................................................................................... 48

Weakness ................................................................................................................................... 48

Opportunities ............................................................................................................................. 49

Threats ....................................................................................................................................... 49

CHAPTER: 6 ................................................................................................................................ 51

Suggestion & Recommendations .................................................................................................. 51

Decentralization ........................................................................................................................ 51

Strategic Business Unit ............................................................................................................. 51

Employee Empowerment .......................................................................................................... 52

Overhead Costs ......................................................................................................................... 52

Two-Way Communication ........................................................................................................ 52

Total Quality Management........................................................................................................ 53

Political Interference ................................................................................................................. 53

BIBLOIOGRAPHY ...................................................................................................................... 54


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Preface

All praise is to Almighty Allah for bestowing me with the wisdom to accomplish our task.

Getting practical knowledge in one of the major aims of MBA program. University Of

Malakandhas followed policy of assigning different practical assignments to its students so a

touch of real working environment can be given to the students apart from classroom studies to

widen their perspective.

PIAC is the national airline of Pakistan. The information has been gathered from different

sources including the web site, web pages related to the airline, personal discussion with

employees, and visit to the station office situated in the Peshawar cant.WE have included all theinformation obtained from the mentioned sources.

As regards the preparation of this report, all the topics are added in a proper sequence, starting

with the table of contents, including the history, overall view, company information,

management hierarchy, flow of information, types of information systems, everything that was

required for the completion of the report.


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Acknowledgement

We are, with the esteem depth of our heart, thankful to the Head of Department, Dr.

Shafiqu-e-rehmanand to our teacher that all of them provided me an opportunity to have a

practical knowledge of all that WE have studied in the course and are busy in polishing our

interpersonal qualities.

We have tried to accomplish the task assigned by the faculty to the best of our abilities, but

still nobody can claimed that he is perfect and there canbe a number of problems in this

report that will be removed only by the guidance from the faculty. WE welcome and

appreciate the error picking and suggestions from the esteem members of faculty.

Here we would like to thank whole heartedly the respected employee of the PIA Peshawar

station Arbab road Peshawar cant.We acknowledge them with thanks for their help. In our

study of the organization.

It would not be fair to mention the name of our collogue who has helped me in the compilation

of this report as he was too busy in his own personal life but he stood up as a good friends and

helped me in preparing the report on the PIAC. So thank you to our dear teacher Dr. Arshad

Alifor your guidance and support.


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Executive Summary

PakistanInternational is the largest air line of the country and the national flag carrier for the state

of Islamic republic of Pakistan. It came into existence in 1947 by the advice of the Quaid-e-

Azam Muhammad Ali Jinnah and ever since it has been serving the nation. In addition to the

convenience of domestic flyers PIAC is serving its International customers throughout the

country and also at several overseas locations.PIA is a 3 star air line by skytrax international.

In this 6 weeks internship program, we have worked in different departments of the PIAC which

include Operations, Admin, HRM, Sales and Promotion, Cargo And Financesectionof PIA

Peshawar and we have learnt a lot from these professional individual who have been working in

their respective fields.

During our internship, we have found that in airlines concentration and consistency is of utmost

importance. Your little mistake can create a big problem and can jeopardize the life of many

individuals. We have worked one week in the above mentioned departments and we have come

to conclusion that these guys are miracle workers. It seems like a in this advance all the jobs are

done by computers but there are still many people who are working for the smooth operations ofthe PIAC. The statement feels true when we say that its the man behind the gun thats counts .

This report contains the information and learning about PIA that we learnt during the 6 weeks

internship period in PIAC Peshawar.

At the end of this report, on the basis of our observations during internship and SWOT analysis

of PIA is provided. Suggestions are also recommended as per learning from analysis. This report

will provide a better and brief learning about Pakistan international Airline Corporation.


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Chapter: 1

Introduction

We the students of management sciences are required to undergo for an internship program as a

part of academic requirement according to the H.E.C. plan for the completion of 2 Year MBA in

Finance. Because the internship gives a chance to develop expertise in the particular area. It also

guides the students to provide consultancy services to various organizations. This report is about

Pakistan International Airline Corporation Peshawar Station, PIAC was established in 1947 and

since still working, it has expended its network, becoming the largest airline of the country.

Purpose of the Study:

The main purpose of the study is:

To collect the relevant information in order to compile the internship report onPakistaninternational airline corporation.

To observe, analyze and interpret the relevant data competently and in a useful manner. To work practically in an organization To develop interpersonal communication

Scope of Study:

The main focus of our study is on its finance department and financial aspects including the

financial health of PIAC and its activities. Some of the problems faced by the PIAC have been

identified and some remedies have also been suggested to overcome the problems and to

improve the prevailing financial condition of the corporation.

Objectives of the Study:

Discuss thorough study of Pakistan international airline corporation To understand the various operations and to equip with practical knowledge of the

Pakistan International Airline Corporation


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Limitation of the Study:

This study was conducted by keeping in view the objectives of the study. The study may not

include broad explanations of facts and figures due to its nature. Secondly, the limitation, which

affects the study, is the restriction on mentioning every fact of the corporation due to the problem

of secrecy of the PIAC. In addition, the availability of required data was a problem as all the

documents and files are kept strictly under lock and key due to their confidential nature. Thirdly,

the problem of short time period also makes the analysis restricted as one cannot properly

understand and thus analyze all the operations of a corporation just a very short time of six

weeks.

Methodology for collection data:

The report is based on internship program inPakistan International Airline Corporation. The

methodology used for data collection is primary as well as secondary. The biggest source of

information is our personal observation while working with staff and having discussion with

them. Formally arranged interviews and discussions also helped me in this regards.

WE got primary data by using our personal observations and Interviews of the staff members.

Secondary data consist of Manuals, Journals, magazines, Annual Reports and Internet.

Company introduction

When Pakistan came into being on 14th

August 1947 there was only one Airline in operation

called Orient Airways. After some time two more airlines Pakistan Air limited and

Crescent Airways started commercial operation. None of these small Air Service Companies

could succeed to cover the requirements of the Air Traffic of the country. Ultimately two of

these failed to continue their operation. In 1952 Orient Airways was the only operational

company operating on domestic routes.

The government and the people of Pakistan were sincerely struggling hard for development of

their country with the aim to reach to the similar level of advancement as of other free nations of


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the world. Communication system is the basic requirement of country. So in 1955 the

Government took an initiative and passed an ordinance to form an Air fleet under the name of

Pakistan International Airlines (PIA) to meet the needs of domestic and international air

traffic.

PIA began operation on Karachi-Dhaka sector with three aircraft in 1955. Later PIA and Orient

Airways, a private carrier, were merged to form PIAC (Pakistan International Airline Company).

Over the years PIA gradually expanded its network and is now serving 83 destinations in four

continents.

Pakistan International Airlines is the national flag carrierand a state-owned enterprise of the

Government of Pakistan.Once regarded as Asia's best airline, it is headquartered at Jinnah

International Airport in Karachi and operates scheduled services to 24 domestic destinations and

38 international destinations in 27 countries across Asia, Europe and North America. Its main

bases are at Karachi, Lahore and Islamabad/Rawalpindi.

The airline's secondary bases include Peshawar, Faisalabad, Quetta, Sialkot and Multan, from

which it connects the metropolitan cities with the main bases, the Middle East, Europe, and the

Far East. It is primarily owned by the Government of Pakistan and is regulated by the Ministry of

Defense as an autonomous body. It employed up to 24,000 people as of June 2012.

History

Pre-Independence

Pakistan International Airlines can trace its origins to the days when Pakistan had not yet gained

independence from the British Raj. In 1946, the country's founder Muhammad Ali Jinnah

realized the need for a flag carrier for the prospective country and requested financial help from a

wealthy businessman Mirza Ahmad Ispahani for this purpose. Around that time, a new airline

'Orient Airways', was registered in Calcutta on 23 October 1946. In February 1947, the airline

bought 3 DC-3 airplanes from a company in Texas and obtained a license to fly in May of the

same year. The airline started its operations in June, offering services from Kolkata to Sittwe and
http://en.wikipedia.org/wiki/Flag_carrierhttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Jinnah_International_Airporthttp://en.wikipedia.org/wiki/Jinnah_International_Airporthttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Allama_Iqbal_International_Airporthttp://en.wikipedia.org/wiki/Benazir_Bhutto_International_Airporthttp://en.wikipedia.org/wiki/Peshawar_International_Airporthttp://en.wikipedia.org/wiki/Faisalabad_International_Airporthttp://en.wikipedia.org/wiki/Quetta_International_Airporthttp://en.wikipedia.org/wiki/Sialkot_International_Airporthttp://en.wikipedia.org/wiki/Multan_International_Airporthttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Europehttp://en.wikipedia.org/wiki/Far_Easthttp://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/Muhammed_Ali_Jinnahhttp://en.wikipedia.org/wiki/Mirza_Ahmad_Ispahanihttp://en.wikipedia.org/wiki/Orient_Airwayshttp://en.wikipedia.org/wiki/Calcuttahttp://en.wikipedia.org/wiki/DC-3http://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Akyabhttp://en.wikipedia.org/wiki/Akyabhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/DC-3http://en.wikipedia.org/wiki/Calcuttahttp://en.wikipedia.org/wiki/Orient_Airwayshttp://en.wikipedia.org/wiki/Mirza_Ahmad_Ispahanihttp://en.wikipedia.org/wiki/Muhammed_Ali_Jinnahhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/Far_Easthttp://en.wikipedia.org/wiki/Europehttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Multan_International_Airporthttp://en.wikipedia.org/wiki/Sialkot_International_Airporthttp://en.wikipedia.org/wiki/Quetta_International_Airporthttp://en.wikipedia.org/wiki/Faisalabad_International_Airporthttp://en.wikipedia.org/wiki/Peshawar_International_Airporthttp://en.wikipedia.org/wiki/Benazir_Bhutto_International_Airporthttp://en.wikipedia.org/wiki/Allama_Iqbal_International_Airporthttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Jinnah_International_Airporthttp://en.wikipedia.org/wiki/Jinnah_International_Airporthttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/Flag_carrier


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Yangon. On 14 August 1947, Pakistan came into being and Orient Airways started relief

operations for the new country. Shortly after Pakistan's independence, the airline moved its

operations to Karachi.

PIA L1049C Super Constellation at London (Heathrow) Airport in 1955

A Convair CV-240 in the 1950s at Karachi airport

A Pakistan International Airlines Boeing 707 photographed in Germany, 1961

Post-Independence

On 7 June 1954, Orient Airways started its operations by offering flight services between the two

wings of Pakistan, i.e. service from Karachi to Dhaka. In addition, the airline also introduced two

new domestic routes, i.e., Karachi-Lahore-Peshawarand Karachi-Quetta-Lahore. However, due

to sustained losses being suffered by the airline, the Government of Pakistan proposed that
http://en.wikipedia.org/wiki/Rangoonhttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Convairhttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Dhakahttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Quettahttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/File:Bundesarchiv_B_145_Bild-F009536-0002,_Staatspr%C3%A4sident_von_Pakistan_in_M%C3%BCnchen.jpghttp://en.wikipedia.org/wiki/File:PIA_Convair_CV-240_in_late_50s._circa.jpghttp://en.wikipedia.org/wiki/File:Lockheed_L1049_AP-AFQ_PIA_LHR_08.04.55_edited-3.jpghttp://en.wikipedia.org/wiki/File:Bundesarchiv_B_145_Bild-F009536-0002,_Staatspr%C3%A4sident_von_Pakistan_in_M%C3%BCnchen.jpghttp://en.wikipedia.org/wiki/File:PIA_Convair_CV-240_in_late_50s._circa.jpghttp://en.wikipedia.org/wiki/File:Lockheed_L1049_AP-AFQ_PIA_LHR_08.04.55_edited-3.jpghttp://en.wikipedia.org/wiki/File:Bundesarchiv_B_145_Bild-F009536-0002,_Staatspr%C3%A4sident_von_Pakistan_in_M%C3%BCnchen.jpghttp://en.wikipedia.org/wiki/File:PIA_Convair_CV-240_in_late_50s._circa.jpghttp://en.wikipedia.org/wiki/File:Lockheed_L1049_AP-AFQ_PIA_LHR_08.04.55_edited-3.jpghttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Quettahttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Dhakahttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Convairhttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Rangoon


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financially successful period for the airline. When the political situation in East Pakistan (present

day Bangladesh) started deteriorating in early 70s, the Pakistan Army once again used PIA's

services to airlift soldiers and ammunition to East Pakistan. Most flights had to detour to Sri

Lanka during trips between West Pakistan and East Pakistan. However, couples of PIAs cargoplanes were shot down by the fighter jets of Indian Air Force. With the establishment of cordial

ties between the Libyan and Pakistani governments in early 70s, PIA added a new international

route, Tripoli, to its map in 1972. It also signed an agreement with Yugoslav airline JAT. PIA

acquired McDonnell Douglas DC-10s in 1973 and used those planes to replace Boeing 707-300s.

In 1974, PIA launched Pakistan International Cargo, offering air freight and cargo services. In

1975, PIA introduced new uniforms for air hostesses which were chosen through an open

competition, with the winning entry designed by Sir Hardy Amies, the designer of Her Majesty

Queen Elizabeth II.

The latter half of the decade witnessed further expansion of PIA's fleet with the introduction of

Boeing 747s through either leased or purchased aircraft. During this decade, airline gained

considerable popularity and was regarded as Asia's best airline. For the first time since its

inauguration, PIA started providing technical and administrative assistance or leased aircraft to

foreign airlines including Somali Airlines, Air Malta and Yemenia. A subsidiary of PIA also

started providing hotel management services in United Arab Emirates towards the end of the

decade.

The Fokker F27 used to be the backbone of PIA's services to northern Pakistani areas in the

1990s
http://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Pakistan_Armyhttp://en.wikipedia.org/wiki/East_Pakistanhttp://en.wikipedia.org/wiki/Tripolihttp://en.wikipedia.org/wiki/Socialist_Federal_Republic_of_Yugoslaviahttp://en.wikipedia.org/wiki/Jat_airwayshttp://en.wikipedia.org/wiki/McDonnell_Douglas_DC-10http://en.wikipedia.org/wiki/Boeing_707http://en.wikipedia.org/wiki/Queen_Elizabeth_IIhttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Somali_Airlineshttp://en.wikipedia.org/wiki/Air_Maltahttp://en.wikipedia.org/wiki/Yemeniahttp://en.wikipedia.org/wiki/United_Arab_Emirateshttp://en.wikipedia.org/wiki/Fokker_F27http://en.wikipedia.org/wiki/File:PIA-F27-Lahore-30861.JPGhttp://en.wikipedia.org/wiki/Fokker_F27http://en.wikipedia.org/wiki/United_Arab_Emirateshttp://en.wikipedia.org/wiki/Yemeniahttp://en.wikipedia.org/wiki/Air_Maltahttp://en.wikipedia.org/wiki/Somali_Airlineshttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Queen_Elizabeth_IIhttp://en.wikipedia.org/wiki/Boeing_707http://en.wikipedia.org/wiki/McDonnell_Douglas_DC-10http://en.wikipedia.org/wiki/Jat_airwayshttp://en.wikipedia.org/wiki/Socialist_Federal_Republic_of_Yugoslaviahttp://en.wikipedia.org/wiki/Tripolihttp://en.wikipedia.org/wiki/East_Pakistanhttp://en.wikipedia.org/wiki/Pakistan_Armyhttp://en.wikipedia.org/wiki/Bangladesh


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A Pakistan International Airlines Airbus A300 at Fiumicino Airport in 1991

1980s

The 1980s decade began with the opening of a cargo handling center at Karachi airport, duty-free

shops, the first C and D safety checks on its entire fleet, as well as the introduction of airline's

first Airbus A300B4-203 aircraft. In 1984, the airline introduced Night-Coach service as a low-

cost alternative to day-time domestic flights. In the following years, PIA Planetarium was

inaugurated in Karachi which was followed by planetariums in Lahore and Peshawar. These

planetariums featured retired PIA aircraft on display for educational or observational purposes.

Two more retired Boeing 720B airplanes were donated to the planetariums in Karachi and

Lahore later on. Also in 1985, five new Boeing 737-300s airplanes were introduced in PIA's

fleet, making PIA the first Asian airline with such diverse aircraft fleet. In late 1987 and early

1988, services to Male and Toronto were introduced. In 1989, ShukriaKhanam became the first

woman pilot to obtain a license to fly a commercial passenger plane but never joined PIA as a

pilot. A year later, First Officer Maliha Sami became the first female pilot of PIA when she took-

off on Karachi-Panjgur-Turbat-Gwadar route.

In mid-1980s, PIA also helped establish Emiratesby leasing two of its airplanes - Airbus A300

and Boeing 737 - as well as providing technical and administrative assistance to the new carrier.

1990s

In June 1991, Airbus delivered the first of six Airbus A310-300 aircraft that PIA had ordered.

With the new airplanes, the airline introduced flights to Tashkent in 1992 and to Zrich in 1993.

PIA added Jakarta, Fujairah, Baku and Al-Ain to its destinations in 1994. In addition, PIA

became a client of three different flight-reservation systems, namely: Sabre, Galileo and
http://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Fiumicino_Airporthttp://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/PIA_Planetarium,_Karachihttp://en.wikipedia.org/wiki/PIA_Planetarium,_Lahorehttp://en.wikipedia.org/wiki/PIA_Planetarium,_Peshawarhttp://en.wikipedia.org/wiki/Boeing_737_Classichttp://en.wikipedia.org/wiki/Mal%C3%A9http://en.wikipedia.org/wiki/Toronto_Pearson_International_Airporthttp://en.wikipedia.org/wiki/Emirates_(airline)http://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Airbushttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Tashkenthttp://en.wikipedia.org/wiki/Z%C3%BCrich_International_Airporthttp://en.wikipedia.org/wiki/Jakartahttp://en.wikipedia.org/wiki/Fujairahhttp://en.wikipedia.org/wiki/Bakuhttp://en.wikipedia.org/wiki/Al-Ainhttp://en.wikipedia.org/wiki/Sabrehttp://en.wikipedia.org/wiki/Galileohttp://en.wikipedia.org/wiki/File:Pakistan_Airbus_A300_Bidini.jpghttp://en.wikipedia.org/wiki/Galileohttp://en.wikipedia.org/wiki/Sabrehttp://en.wikipedia.org/wiki/Al-Ainhttp://en.wikipedia.org/wiki/Bakuhttp://en.wikipedia.org/wiki/Fujairahhttp://en.wikipedia.org/wiki/Jakartahttp://en.wikipedia.org/wiki/Z%C3%BCrich_International_Airporthttp://en.wikipedia.org/wiki/Tashkenthttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Airbushttp://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Emirates_(airline)http://en.wikipedia.org/wiki/Toronto_Pearson_International_Airporthttp://en.wikipedia.org/wiki/Mal%C3%A9http://en.wikipedia.org/wiki/Boeing_737_Classichttp://en.wikipedia.org/wiki/PIA_Planetarium,_Peshawarhttp://en.wikipedia.org/wiki/PIA_Planetarium,_Lahorehttp://en.wikipedia.org/wiki/PIA_Planetarium,_Karachihttp://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Fiumicino_Airporthttp://en.wikipedia.org/wiki/Airbus_A300


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Amadeus.Air Safari flights were launched in 1994 using Boeing 737300 aircraft that used to

fly over the Karakoram mountain range. In 1995, PIA purchased a Boeing 747 flight simulator to

train its pilots. It also purchased another used Airbus A300 aircraft from Air France. A

TupolevTu-154 aircraft was also leased briefly in 1996 to cope with surge in passenger trafficduring summer 1996. Flights to Beirut were resumed the same year as well.

In 1999, PIA leased 5 Boeing 747300 aircraft from Cathay Pacific to replace its Boeing 747-

200M fleet. The aircraft were painted with a new livery - a handwork Pashmina tail on white

body and large Pakistan titles on the front fuselage. The livery was adopted in early 90s but due

to some copyright issues it had to be dropped. The Boeing 747-300s remained in the new look

but with a plain green tail with PIA titles. The other aircraft in the fleet were repainted in early

1990s livery.

2000s

Boeing 747-300 on finals to London Heathrow Airport, England

In July 2002, PIA purchased six Boeing 747-300 aircraft from Cathay Pacific, five of which

were already on lease. The sixth one arrived shortly afterwards and was used mainly on its North

American and European routes. In October 2002, after a period of ten years without any new

orders, the airline placed an order for eight Boeing 777 aircraft from The Boeing Company. The

order included all three variants of 777, i.e. three 777-200ER(Extended Range), two 777-200LR

(Longer Range) and three 777-300ERversions. PIA was the launch customer that revived the

Boeing 777-200LR project that, until then, only had three orders by EVA Air.

Boeing delivered the first of three 777-200ER aircraft to PIA in January 2004. PIA introduced a

new livery for 777-200ERs airplanes and that livery was later applied to most airplanes of its

fleet. PIA also leased six more Airbus A310-300/ETplanes from Airbus Company directly. On 3

November 2005, PIA placed an order to purchase seven ATR42-500 aircraft from ATR to
http://en.wikipedia.org/wiki/Amadeushttp://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Karakoramhttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Air_Francehttp://en.wikipedia.org/wiki/Tupolevhttp://en.wikipedia.org/wiki/Beiruthttp://en.wikipedia.org/wiki/Cathay_Pacifichttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/London_Heathrow_Airporthttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Cathay_Pacifichttp://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/The_Boeing_Companyhttp://en.wikipedia.org/wiki/777-200ERhttp://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/777-300ERhttp://en.wikipedia.org/wiki/EVA_Airhttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Airbushttp://en.wikipedia.org/wiki/ATR_42http://en.wikipedia.org/wiki/ATR_(aviation)http://en.wikipedia.org/wiki/File:Pia.b747-367.ap-bfw.750pix.jpghttp://en.wikipedia.org/wiki/ATR_(aviation)http://en.wikipedia.org/wiki/ATR_42http://en.wikipedia.org/wiki/Airbushttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/EVA_Airhttp://en.wikipedia.org/wiki/777-300ERhttp://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/777-200ERhttp://en.wikipedia.org/wiki/The_Boeing_Companyhttp://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Cathay_Pacifichttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/London_Heathrow_Airporthttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Cathay_Pacifichttp://en.wikipedia.org/wiki/Beiruthttp://en.wikipedia.org/wiki/Tupolevhttp://en.wikipedia.org/wiki/Tupolevhttp://en.wikipedia.org/wiki/Air_Francehttp://en.wikipedia.org/wiki/Airbus_A300http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Karakoramhttp://en.wikipedia.org/wiki/Boeing_737http://en.wikipedia.org/wiki/Amadeus


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replace its aging fleet ofFokker F27 aircraft. On 6 December 2005, PIA acquired another new

Boeing 777-200ER on a ten year lease from the International Lease Finance Corporation (ILFC).

The aircraft was delivered in January 2007 to the airline.

On 25 February 2006, Boeing delivered its first 777-200LR Worldliner to PIA, when it flew

from Everett to Islamabad via Manchester. With the induction of long range aircraft in its fleet,

PIA started offering non-stop flights from Toronto to Karachi, Islamabad, and Lahore from 3

March 2006. PIA had also planned non-stop flights to New York and other US cities with sizable

Pakistani populations but was not given permission by US authorities. ATR delivered two of the

seven ordered airplanes by PIA in May and December 2006 respectively, following which the

airline ceased using military Lockheed C-130 Hercules for passenger services in northern areas

of Pakistan. The military planes were being used after the PIA Flight 688 accident. On 23

December 2006, PIA took delivery of its first Boeing 777-300ER.

A pair ofBoeing 747s stored at Sialkot in 2008 during the EU restrictions. However, once the

ban was lifted the aircraft were back in use on all routes

European Union Ban

On 5 March 2007, the European Commission banned all but 9 planes of PIA's 42-plane fleet

from flying to Europe citing safety concerns of its aging fleet. The ban was imposed following

an on-site visit led by Federico Grandini, European Commissions Air Safety Administrator. The

remaining 7, namely the fleet ofBoeing 777s, was exempted from the ban. PIA claimed that the

ban was discriminatory and unjustifiable. On 26 March 2007, Tariq SaeedKirmani was forced to

resign after severe pressure from higher authorities because of the EU ban. Zafar Khan was

appointed as the new chairman of Pakistan International Airlines. The ban on the eleven of thirty

five aircraft was lifted after a period of four months on 5 July 2007, following another inspection
http://en.wikipedia.org/wiki/Fokker_F27_Friendshiphttp://en.wikipedia.org/wiki/International_Lease_Finance_Corporationhttp://en.wikipedia.org/wiki/Everett,_Washingtonhttp://en.wikipedia.org/wiki/Manchesterhttp://en.wikipedia.org/wiki/Torontohttp://en.wikipedia.org/wiki/C-130_Herculeshttp://en.wikipedia.org/wiki/PIA_Flight_688http://en.wikipedia.org/wiki/777-300ERhttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Sialkot_International_Airporthttp://en.wikipedia.org/wiki/European_Commissionhttp://en.wikipedia.org/w/index.php?title=Federico_Grandini&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Federico_Grandini&action=edit&redlink=1http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/File:PIA_B747s_stored_SIAL.jpghttp://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/w/index.php?title=Federico_Grandini&action=edit&redlink=1http://en.wikipedia.org/wiki/European_Commissionhttp://en.wikipedia.org/wiki/Sialkot_International_Airporthttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/777-300ERhttp://en.wikipedia.org/wiki/PIA_Flight_688http://en.wikipedia.org/wiki/C-130_Herculeshttp://en.wikipedia.org/wiki/Torontohttp://en.wikipedia.org/wiki/Manchesterhttp://en.wikipedia.org/wiki/Everett,_Washingtonhttp://en.wikipedia.org/wiki/International_Lease_Finance_Corporationhttp://en.wikipedia.org/wiki/Fokker_F27_Friendship


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by European Union's Air Safety Administration. Of the eleven aircraft, five were Boeing 747-

300s and the remaining six were Airbus A310-300s. On 29 November 2007, the EU completely

removed the ban and PIA's entire fleet was permitted to fly to Europe. To avoid any such

embarrassment in future, PIA signed a deal to lease seven new Airbus A320-200 from Kuwaitbased leasing company ALAFCO. The aircraft were supposed to be delivered during 2008 and

2009 but the deal was cancelled before any delivery took place.

Current decade

In February 2012, PIA ordered 5 more Boeing 777-300ERaircraft with delivery starting in 2015.

In August 2012, it was announced that PIA will induct another eight aircraft to its fleet. This

upgrade would include 2 777-200ER, 2 Boeing 747-400 and 4 Boeing 737-800. The 777s will be

inducted in November 2012 while the remaining aircraft would be inducted in December2012.(Please update these information. No new Boeing jet(2 B777-200ER, 2 B747-400 and 4

B737-800) was inducted in the PIA fleet in till December 2012)
http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Airbus_A320_familyhttp://en.wikipedia.org/wiki/ALAFCOhttp://en.wikipedia.org/wiki/Boeing_777-300ERhttp://en.wikipedia.org/wiki/777-200ERhttp://en.wikipedia.org/wiki/Boeing_747-400http://en.wikipedia.org/wiki/Boeing_737-800http://en.wikipedia.org/wiki/Boeing_737-800http://en.wikipedia.org/wiki/Boeing_747-400http://en.wikipedia.org/wiki/777-200ERhttp://en.wikipedia.org/wiki/Boeing_777-300ERhttp://en.wikipedia.org/wiki/ALAFCOhttp://en.wikipedia.org/wiki/Airbus_A320_familyhttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Boeing_747


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CHAPTER: 2

Corporate Management

Structure

Pakistan International Airlines Corporation (PIAC) is majority owned by the Government of

Pakistan (87%) while the remainder (13%) by private shareholders. The airline is under the

administration ofMinistry of Defense the chairman of which is Ahmad Mukhtar. The airline is

managed by managing director as well as the Board of Directors. The Board consists of nine

independent non-executive members and has four sub-committees: an Audit Committee, Brand

and Advertising Committee, Finance Committee, and Human Resource Committee each having

its own charter and chairman. The MD leads the executive management of staff who run the

airline. The airline's main headquarters are located at Karachi Airport while smaller sub head

offices are located in several cities within Pakistan.

Privatization

In the late 1990s, the Government of Pakistan considered selling the airline to the private sector

due to the persistent losses suffered by the airline. The Government announced its privatization

plans but they were never implemented. Several steps towards outsourcing of non-core businesshave been initiated. Catering units (starting with Karachi Flight Kitchen), ground handling

(starting with ramp services) and engineering, are to be gradually carved out of the airline and

operated as independent companies. During 1997, Pakistan called in a team from International

Finance (IFC), the consulting arm of the World Bank, to advice on restructuring and

privatization of Pakistan International Airlines (PIA). However, no agreement was reached. The

government has had many plans for the privatization of the State owned airline. However, no

reasonable agreement or solution has been found to this day. On 18 February 2009 the carrier

was dropped from the privatization list.

Financial performance

The following table gives the key financial results for 2011 along with those since 2004. The

financial performance for FY 2011 continues to be a challenge with an after tax loss of PKR
http://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/Ministry_of_Defence_(Pakistan)http://en.wikipedia.org/wiki/Ahmad_Mukhtarhttp://en.wikipedia.org/wiki/Board_of_Directorshttp://en.wikipedia.org/wiki/Managing_directorhttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/International_Financehttp://en.wikipedia.org/wiki/International_Financehttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/International_Financehttp://en.wikipedia.org/wiki/International_Financehttp://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Managing_directorhttp://en.wikipedia.org/wiki/Board_of_Directorshttp://en.wikipedia.org/wiki/Ahmad_Mukhtarhttp://en.wikipedia.org/wiki/Ministry_of_Defence_(Pakistan)http://en.wikipedia.org/wiki/Government_of_Pakistanhttp://en.wikipedia.org/wiki/Government_of_Pakistan


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26.767 billion. This was preceded by six consecutive loss making years dating back to 2005. The

airline did report a reduction of post tax losses of 83% in 2009 (compared to 2008) based on a

reduction in fuel cost, comparatively stable exchange rate for the Pakistan Rupee and higher

revenues. But in 2011 & 2010, losses again rose sharply compared to the previous years.The airline faces many challenges to its profitability such as staffing levels and overall

management issues. An employee count of 18,014 for a fleet of 40 aircraft is clearly an area that

needs to be reviewed.

Revenues

YearRevenues (PKR Millions) Profit/(Loss) (PKRMillions)

Employees

(Ave.)

20122011

142,000116,551

(158,000)(26,767)

1800018,014

2010 107,532 (20,785) 18,019

2009 94,564 (5,822) 17,944

2008 88,863 (36,139) 18,036

2007 70,481 (13,399) 18,149

2006 70,587 (12,763) 18,282

2005 64,074 (4,412) 19,263

2004 57,788 2,307 19,634

The report for the first quarter of 2012 does not show any improvement. The after tax losses

reported for the year of 2012 are PKR 158 billion as compared to PKR 26,767 for year of 2011.

Revenue is also pretty much stagnant at PKR 142,000 billion for the year of 2012 compared with

PKR 116,551 billion for the year of 2011.

After hovering around the five and a half million mark for around 5 years, the passenger traffic

rose to just under six million in 2011 while the passenger load factor went down from 74% in

2010 to 72% in 2011.


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Passenger Traffic

YearRevenue Passengers

(Million)

Passenger Load

Factor

Average Passenger Stage Distance

(Statute KM)

2011 5.953 72 2,631

2010 5.538 74 2,827

2009 5.535 70 2,510

2008 5.617 71 2,479

2007 5.415 67 2,527

2007 5.415 67 2,527

2006 5.732 69 2,639

2005 5.499 70 2,638

It is also interesting to note that for 2011; about 81% of revenue is from passenger traffic and

only 5% from cargo. Another 7.8% is from room food and beverage sales! The remaining 6% is

from excess baggage, charter, engineering services, handling & related services, mail & other.

Chairman of PIA

List of Chairman of Pakistan International Airline

Chairman Name Joined Retired

Mirza Ahmad Ispahani 17 March 1955 1962

Abdul Qasim Khan 30 October 1962 1963

ChaudhryNazir Ahmad Khan 12 July 1963 1965

Syed FidaHussain September, 1965 1966

S. Ghyasuddin Ahmed June, 1966 1973

Maj Gen (R) FazalMuqeem Khan August, 1973 November, 1973

Air Marshal (R) Nor Khan 7 November 1973 30 September 1978

Anwar Jamali 1 October 1978 21 January 1981

Maj Gen (R) FazalMuqeem Khan 22 January 1981 3 December 1985
http://en.wikipedia.org/wiki/Mirza_Ahmad_Ispahanihttp://en.wikipedia.org/wiki/Mirza_Ahmad_Ispahanihttp://en.wikipedia.org/wiki/Nur_Khanhttp://en.wikipedia.org/wiki/Nur_Khanhttp://en.wikipedia.org/wiki/Nur_Khanhttp://en.wikipedia.org/wiki/Mirza_Ahmad_Ispahani


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Syed IjlalHaiderZaidi 4 December 1985 12 April 1989

Air Marshal Mohammed AzimDaudpota 13 April 1989 15 December 1989

Air Chief Marshal FarooqFeroze Khan 16 December 1989 6 July 1990

Col (R) GhulamSarwarCheema 7 July 1990 6 August 1990

Air Chief Marshal FarooqFeroze Khan 7 August 1990 7 March 1991

Muhammad Nawaz Tiwana 8 March 1991 8 September 1991

MumtazHameed 8 September 1991 30 June 1992

Muhammad Nawaz Tiwana 1 July 1992 27 September 1992

Mohammad Anwar Zahid 28 September 1992 5 January 1994

Syed Salim Abbas Jilani 6 January 1994 27 September 1994SardarnoorElahiLaghari 28 September 1994 17 October 1996

Muhammad Nawaz Tiwana 18 October 1996 25 November 1996

HasanRaza Pasha 25 November 1996 29 April 1997

ShahidKhaqanAbbasi 30 April 1997 12 October 1999

Lieutenant-General (R) NaseemRana 11 November 1999 29 March 2001

Lieutenant General Hamid Nawaz Khan 30 March 2001 7 February 2003

Chaudhry Ahmad Saeed 8 February 2003 16 April 2005

Tariq Kirmani 19 April 2005 9 April 2007

Zafar Ahmad Khan 9 April 2007 28 February 2008

Kamran Rasool 28 February 2008 6 May 2009

Chaudhry Ahmed Mukhtar 6 May 2009 24 May 2012

Air Chief Marshal (R) RaoQamarSuleman 29 May 2012 19 September 2012

Lt Gen (R) AsifYaseen Malik 24 October 2012 Till date

Destinations
http://en.wikipedia.org/wiki/Ijlal_Haider_Zaidihttp://en.wikipedia.org/wiki/Ijlal_Haider_Zaidihttp://en.wikipedia.org/wiki/Azim_Daudpotahttp://en.wikipedia.org/wiki/Azim_Daudpotahttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Shahid_Khaqan_Abbasihttp://en.wikipedia.org/wiki/Shahid_Khaqan_Abbasihttp://en.wikipedia.org/wiki/Naseem_Ranahttp://en.wikipedia.org/wiki/Naseem_Ranahttp://en.wikipedia.org/wiki/Hamid_Nawaz_Khanhttp://en.wikipedia.org/wiki/Hamid_Nawaz_Khanhttp://en.wikipedia.org/wiki/Ahmed_Saeedhttp://en.wikipedia.org/wiki/Ahmed_Saeedhttp://en.wikipedia.org/wiki/Chaudhry_Ahmed_Mukhtarhttp://en.wikipedia.org/wiki/Chaudhry_Ahmed_Mukhtarhttp://en.wikipedia.org/wiki/Rao_Qamar_Sulemanhttp://en.wikipedia.org/wiki/Rao_Qamar_Sulemanhttp://en.wikipedia.org/wiki/Rao_Qamar_Sulemanhttp://en.wikipedia.org/wiki/Chaudhry_Ahmed_Mukhtarhttp://en.wikipedia.org/wiki/Ahmed_Saeedhttp://en.wikipedia.org/wiki/Hamid_Nawaz_Khanhttp://en.wikipedia.org/wiki/Naseem_Ranahttp://en.wikipedia.org/wiki/Shahid_Khaqan_Abbasihttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Farooq_Feroze_Khanhttp://en.wikipedia.org/wiki/Azim_Daudpotahttp://en.wikipedia.org/wiki/Ijlal_Haider_Zaidi


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As of December 2012 PIA serves 24 domestic destinations and 38 international destinations in

27 countries across Asia, Europe and North America from its home bases of Karachi, Lahore,

Islamabad and Peshawar.

Dubai is a major focus city for the airline with flights to Bahawalpur, Dera Ghazi Khan,Faisalabad, Islamabad, Karachi, Lahore, Multan, Peshawarand Quetta.

Domestic Net work24 Destinations
http://en.wikipedia.org/wiki/Karachihttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Islamabadhttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Focus_cityhttp://en.wikipedia.org/wiki/Bahawalpurhttp://en.wikipedia.org/wiki/Dera_Ghazi_Khanhttp://en.wikipedia.org/wiki/Faisalabadhttp://en.wikipedia.org/wiki/Multanhttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Quettahttp://en.wikipedia.org/wiki/Quettahttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Multanhttp://en.wikipedia.org/wiki/Faisalabadhttp://en.wikipedia.org/wiki/Dera_Ghazi_Khanhttp://en.wikipedia.org/wiki/Bahawalpurhttp://en.wikipedia.org/wiki/Focus_cityhttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Peshawarhttp://en.wikipedia.org/wiki/Islamabadhttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Karachi


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International Network - 36+2 Destinations


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Code share agreements

PIA has code share agreements with the following airlines (as of December 2012):

China Southern Airlines (Sky Team)

Thai Airways International (Star Alliance)

Turkish Airlines (Star Alliance)

Vision

PIA's vision is to be a world class profitable airline meeting customer expectations through

excellent services, on-time performance, innovative products and absolute safety

Mission

Employee teams will contribute towards making PIA a global airline of choice through:

Offering quality customer services and innovative products Using state-of-the-art technologies

Ensuring cost-effective measures in procurement and operations Developing Safety Culture

Corporate Values

Customer Expectations

(Convenience, Care, Affordability)

Service

(Personalized, Courteous, Passionate)

Innovation

(New Ideas, Products, Value Added Services)

Cohesiveness

(Respect for Individuals, Teamwork and Effective Communication)

Integrity

(Business Ethics, Accountability, and Transparency)

Reliability

(Loyalty and Consistency)

Safety

(Passengers, Employees, Environment)

Social Responsibility

(Welfare, Health, Education)
http://en.wikipedia.org/wiki/Codeshare_agreementhttp://en.wikipedia.org/wiki/China_Southern_Airlineshttp://en.wikipedia.org/wiki/Thai_Airways_Internationalhttp://en.wikipedia.org/wiki/Star_Alliancehttp://en.wikipedia.org/wiki/Turkish_Airlineshttp://en.wikipedia.org/wiki/Star_Alliancehttp://en.wikipedia.org/wiki/Star_Alliancehttp://en.wikipedia.org/wiki/Turkish_Airlineshttp://en.wikipedia.org/wiki/Star_Alliancehttp://en.wikipedia.org/wiki/Thai_Airways_Internationalhttp://en.wikipedia.org/wiki/China_Southern_Airlineshttp://en.wikipedia.org/wiki/Codeshare_agreement


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Achievements and recognitions

PIA was the first Asian airline to receive the Boeing 737300 First airline in the world to operate scheduled helicopter services. The first airline from an Asian land country and the first airline from a Muslim country to

fly the Super Constellation.

The first Asian airline to operate a jet aircraft. The first Asian airline to be granted maintenance approval by the US Federal Aviation

Administration (FAA) and the Air Registration Board, predecessor of the British Civil

Aviation Authority (CAA).

The first non-communist airline to fly to the People's Republic of China, and to operate aservice between Asia and Europe via Moscow.

The first airline in Asia to induct the new technology Boeing 737-300 aircraft. An IBM 1401, the first computer in Pakistan, was installed in PIA. The first airline to introduce a second route to People's Republic of China over the

mighty Karakoram mountains.

The first airline to show in-flight movies on international routes. PIA set up Pakistan's first planetarium at Karachi. The first airline in the world to fly to Tashkent, capital of the newly independent state of

Uzbekistan. First airline in the world to start Air Safari with jet aircraft. First Asian airline to start flights to Oslo. First airline in Pakistan to operate a flight with an all female crew at command and in the

cabin.

PIA was given the first place award for the biggest volume increase in 2006, by FrankfurtAirport Authority.

First airline in the world to induct and operate the Boeing 777-200ER, 777-200LR and777-300ER together (all three variants available on the market).

PIA was given three domestic awards in 2008: The "Brands of the Year" Award,"Consumers Choice Award" and "One The Best Airlines Award (Cargo)".
http://en.wikipedia.org/wiki/Oslohttp://en.wikipedia.org/wiki/Oslo


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PIA provided extensive support in the creation, development and management ofEmirates, Singapore Airlines and Sri Lankan Airlines during their initial years of

operation.

PIA was awarded a shield by Presidency of Civil Aviation in Saudi Arabia in recognitionof distinguished Passenger Services compared to other airlines conducting Hajj

operations for the 3 consecutive years [2010 - 2012] among 74 international airlines

operating from the Hajj terminal in that country at Jeddah Airport.

Fleet

The Pakistan International Airlines fleet includes the following aircraft (as of December 2012)

Pakistan International Airlines Fleet

Aircraft Total Order OptionPassengers

NotesJ Q Y Total

Airbus A310-300 12 0 0

12 40 132 184

18 43 144 205

18 45 142 205

ATR 42-500

6 0 0 10 40 50

Boeing 737-300 4 0 0 24 94 118

Boeing 747-300 5 0 0 30 448 478

To exit service

starting in March

2015

Boeing 777-200ER 4 0 035 45 240 320

35 54 240 329

Boeing 777-200LR 2 0 0 35 60 215 310

Boeing 777-300ER 3 5 5 35 60 304 393Order delivery from

2015

Total 36 5 5
http://en.wikipedia.org/wiki/General_Authority_of_Civil_Aviationhttp://en.wikipedia.org/wiki/King_Abdulaziz_International_Airporthttp://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/ATR_42http://en.wikipedia.org/wiki/ATR_42http://en.wikipedia.org/wiki/Boeing_737_Classichttp://en.wikipedia.org/wiki/Boeing_737_Classichttp://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_777http://en.wikipedia.org/wiki/Boeing_747http://en.wikipedia.org/wiki/Boeing_737_Classichttp://en.wikipedia.org/wiki/ATR_42http://en.wikipedia.org/wiki/Airbus_A310http://en.wikipedia.org/wiki/King_Abdulaziz_International_Airporthttp://en.wikipedia.org/wiki/General_Authority_of_Civil_Aviation


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Hierarchy of PIAC Management

Chairman PIAC

Managing Director

Chief Operating Officer

Director

General Manager

Manager

Assistant Manager

Officer

Supervisor

Assistant


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Chapter: 3

Departments of PIAC

PIAC Airline has been divided into the following function units.

Network & Route Planning Administration Finance Marketing Engineering Flight Operations Airport Services Cargo Sales & Services Precision Engineering Complex Flight Services Coordination

Network & Route Planning Department

This department carries out formulation and implementation of overall corporate plans. This

department provides guidelines to each division/department to fix their goals and formulate

strategies to achieve them. It has the following subdivisions:

International and Civil Aviation Affairs Division

Economic Planning Division

Fleet Planning Division

Administration Department

Administration department is one of the pivotal departments, which is responsible for the

administration of human resources and formulation of the corporate personnel policies; it has

coordinating and regulatory body, which regulates relationship between management and

employees. Further subdivision is as under:


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Human Resource Division Personnel Division PIA Training Center

Policies and Remuneration Division Security Services Division Medical Services Division Industrial Relations Division Legal Services Division Sports Division

Finance Department

Finance department is one of the biggest departments in the airline, which is responsible for

provision of efficient and effective accounting/budget. The feasibility of extending financial,

administrative, technical facilities is control by this department. It is also responsible for internal

auditor of PIAC. It has further divisions, which are as under:

Planning and Budget Funds Management Accounting Internal Audit Subsidiaries

Marketing Department

It looks after development of Marketing Plans & Policies. This department performs all

marketing functions. Subdivision is given below:

North (KHE) Division South (KHI) Division UK (LON) Division USA & Canada (NYC) Europe (FRA) Division


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Saudi Arabia (JED) Division Asia Pacific (SIN) Cargo Sales Division

Market Planning & Services Division Gulf (DXB) Division Passenger Sales Division Reservation & Yield Management Division

Engineering Department

This department takes care of planning, base/line maintenance and overhauling of whole of the

PIAs fleet. To keep pace with the new technology, it has a special branch named asDevelopment Engineering to meet the future challenges in the sphere of avionics. Following

are its further subdivisions:

Planning and Project Division Quality Assurance Division Avionics and overhaul Division Base Maintenance Division Line Maintenance Division Development Engineering Division Power Plant Division Resource Management Division North Division

Flight Operations Department

This department coordinates the training, flight engineering, planning and scheduling of flight

operations. It is responsible for all the activities of the flight operation in PIA and ensured central

control over all flights. The department has been organized on the following line:

Flight Engineering Division

Standards Division

Central Control Division


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Planning & Scheduling Division

Technical Division

Coordination Division

Training DivisionNorth Division

Airport Services Department

Customer Services Department has two subdivisions, which are given blow:

Passenger Services Division

As the name implies, this division is responsible to provide services to the passengers as well as

aircraft at the airport. This subdivision in addition to the Passenger Services also possesses

Facilitation & Planning, Technical Ground Support (TGS) and Terminal Services (KCI).

Flight Services Division

This subdivision provides for provisioning of all in-flight services like food, cabin crew and field

services.

Coordination Department

The purpose of Coordination Department, which is headed by Director Coordination, is to

coordinate all matters received through Government of Pakistan.


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CHAPTER: 4

Finance Department of PIAC

The duties and functions of a typical finance department can be classified into two generic

categories. The first category is planning and the second function is controlling. These activities

are inter-related and inseparable because if there is no planning these will not be any control.

Therefore, planning and control move together.

Planning refers to the activities, which bridge the gap from the starting point to the terminal

point. Planning in the finance department under review refers to the activities of Cash Flow and

Budget preparation. These are the major activities (planning) in any such department.

Function of Finance Department

Planning

Planning is fundamental to the management process, a process of sensitizing an organization to

external opportunities and threats, of determining desirable and possible objectives, and of

deploying resources to match the objectives. Without planning there is no basis for controlling

for planning provides the foundation upon which the control function operates. The planner

should be able to visualize the proposed pattern of activities individually and collectively,

internally and externally.

Budgets

The budget is not only the most important plan of an enterprise, but also the basic link of

accounting with management. The use of budgets, particularly in connection with the control

phase of management has been termed as budgetary control. A companys organization chart

and its chart of accounts from the basic framework on which to build a coordinated and efficient

system of managerial planning and budgetary control. The organization chart defines the

functional responsibilities for the budgets rests with executive management; all managers are,

responsible for the preparation and execution of their departmental budgets. If a budgetary

control system is to be successful, these managers must fully cooperate and must understand

their role in making the budget system successful.


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Controlling

This function of the finance department is carried out in the light of standards set in the planning

stage. The actual performance is compared with the preplanned objectives and standards, which

lead to the rectification of any deviation and improvement suggestions, which will assist in thefuture planning. Management control is the systematic effort by the business management to

compare performance to plans the control function is of prime importance in the accomplishment

of objectives. The need for control increases with the size and complexity of the organization.

Continuous supervision of an activity, task, or job is required to keep it within previously defined

boundaries. These boundaries termed and budgets in the planning phase, are set up for

manufacturing, marketing, finance and all other activities. Actual results are measure against

plans; and if significant differences are noted, remedial actions are taken.

Department of Finance

Out of the nine divisions in the finance department, Revenue Division is the most important

division. Some of the important divisions/sections are described below in detail.

Revenue Division

Airline sells space and services and these are measured in terms of money. Revenue division

controls the revenue in terms of money. It is further subdivided into these sections:

Passenger Revenue Cargo Revenue Interline Revenue Pricing

For each type of the revenue stream there is an independent unit. So Revenue Division is

discussed in units:

A. Passenger Revenue:

Sales: Revenue function starts from printing of tickets. Thickets of airline contain few coupons

with a jacket (bearing instruction on it) tickets are sold at station and at agents offices. Sales of

tickets may be:


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Direct Sale or

Indirect Sale

Direct sales mean sale at stations of PIAC, whereas indirect sales are by agents.

Direct Sale

There are many locations for direct sales all over network of PIA. Three types of ticketing are

practiced i.e. manual ticketing and auto ticketing and E-Ticket. Manual ticketing involves

procedures of pencil paper work on printed tickets. Whereas auto ticketing involves advance

system of computerized ticketing and on the spot computerized ticket printing. Regarding direct

sales following four documents are important:

Passenger Revenue/Extra Baggage Carrier Ticket:

The ticket has four/three coupons. First is audit coupon, second is issue office coupon, third

flight/lift coupon and fourth the revenue coupon. Flight coupons are arranged for one/two or four

sectors. Audit coupon and flight coupons are most important coupons. Because flight coupon is

the only coupon to be used either for lift, or for refund/reissue/travel on non-PK carrier, etc.

whereas as audit coupon is meant for PIAs revenue record. Audit coupons are sent to head

office with sales statements from each station. Accounting to entry is based on audit coupon.

Miscellaneous charges order (MCO):

These documents contain, audit issue office and exchange coupons, these are meant for exchange

if for the time being you dont want to travel but want to block a seat. Or if you were charged

higher fare than the class you traveled in.

Prepaid Ticket Advice (PTA):

This is for sponsoring the tickets or the relative, friends, etc. for any other country/destination the

money paid by the person sponsoring the ticket in advance and after the checking of the


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documents of the nominee of the sponsored, sponsoree is issued this ticket. The responsible

station communicates through telexes.

Agency Sales:

There are three types of agents selling tickets of PIA. IATA approved agents, General Sales

Agents (GSAs) and Non-IATA Agents. Agents are paid commission on domestic 5% and on

international 9% and sometimes paid 3% above the normal rates. Agents as well as stations are

required to submit the sales statements. These may be daily/weekly/monthly as the case may be.

Refund Unit:

Persons who do not report 72 hours before the flight the seat are automatically canceled. In case

of international tickets the unused tickets are fully refunded. Jacket covering the coupons of the

ticket bears instructions and procedure of cancellation charges with specified rates.

PIA policy that it facilitates its customer if the flight is cancelled due to any reason than PIA will

not charge any amount to the customer and the refund amount will be fully paid. WE have

observed that at our work in PIAC Islamabad /Rawalpindi station most of the refund cases were

of domestic flight for Gilgit and Skardu.

Accounting Unit:

Disk/information received from all stations sometimes enables this unit to monitor accounting

and prepare floppies and transmit them to the main frame. In PIAC accounting is fully automated

and computerized. Few stations have on line systems too however manual work is not totally

eliminated due to non-availability of the on line systems at some stations.


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B. Cargo Revenue Section

Before going into details it will to look at the organizational set up to this section.

In the hierarchy above R-2 stands for revenue generated by PIAs own counters where there is no

commission on sales, R-3 is concerned with FOB payment by consignee, in which commission

factor is involved. R-11 stands for a document regarding the agents sales revenue and

remittance report. Whereas miscellaneous includes refunds, handling charges, etc.

Sales Unit:

Sales may be of two types; sales on PIAs own counters and sales by agents. When cargo sales

are made airway bills are prepared by stations/agencies. Stations are responsible for reports to

head office about airway bills, both of agents and stations. Agents reports to stations and

stations to H.O. Cargo sales may be domestic or international. R-2 is statement regarding

domestic cargo sales and international cargo sales for PIA counters whereas R-11 is a statement

for agents cargo sales. R-3 is collection report. Rs are returns prepared by the stations and sent

Manager

Assistant

Manager Sale

Assistant

Manager Lift

Accounts

Officer

R-2

Accounts

Officer

R-11

Accounts

Officer

Mail Rev.

Accounts

Officer

MISCE.

Accounts

Officer

R-3


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to lift unit. Lift unit keeps the tracks of the cargo sales revenue and monitors the preparation and

collection made by stations.

International Revenue Section:

All airlines render services and these are measured in terms of money. Revenue division is

responsible to keep the tracks off all the revenue. Interline revenue has two aspects:

Receivable:

When passenger from any other purchases ticket airline but lifted by PIA.

Payable:

Some other carrier but lifts passengers purchases when ticket from PIA.

These transactions are settled through IATA clearance house. IATA clearance house has its

member airlines are dealt according to the standing agreements with them. As IATA regulates

the airline industry in the world most of the settlements are through IATA. Sometimes revenue is

divided according to sectors carried. These types of the settlement are made on the basis of

mileage. This is called probation. For settlement there are three currencies in which payments are

receipts are made.

European Currency US Dollar Pound Sterling

Pricing

This section of the revenue division was established in 1975. It acts as regulating authority of the

airline. According to IATA rules approved fare written on the face of the tickets should be

charged as that fare is approved. But the airlines undercut their fare especially in other than the

base country. This section monitors these underground unethical violations of the IATA rules.

When other airlines undercut fares and PIA feels that it must also undercut, the station managers

prepares proposals about fare expected to be charged and sends these proposals to marketing

department. Marketing Department analysis the proposals and approve them after comparing

with last years figures. Final approval is made by director sales


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Our Work Experience in PIAC Islamabad

As PIAC is a commercial organization. It main function is to carry passenger from one place to

another place, one country to other country. One continent to other continent gave way taking

cargo is second major function of PIAC. As the PIA business is a different type of business from

a routine business. Thats why its accounting system is somewhat different and accounting

reports are different from the routine reports.

There Are Different Types of Reports in Which Different Type of Sale Are

Reported

Report No 1 (R1)

Counter Pax Sale: In R1 Counter Pax Sale is reported. Counter Pax Sale means direct passenger

traveling sale from the station counter. There is three type of Counter Pax Sale.

International Pax Sale

Domestic Pax Sale

National Assembly Pax Sale

Report No 2 (R2)

Counter Cargo Sale: In R2 the Counter Cargo Sale is reported. Cargo Sale means directs cargo

sale from the station counter. There is three type of cargo sale.

International Cargo Sale

Domestic Cargo Sale

Air Express Sale

Report No 3 (R3)

Other Station Cargo Sale: In R3 Cargo Sale is reported. That type of Cargo Sale, which is

booked at one station without payment. When it is received at the destination station then


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payment is made at the destination station. When that payment is received in that station from

where the parcel is booked then it is reported in R3.

Report No 4 (R4)Miscellaneous Receipts: In R4 miscellaneous receipts are reported. Different types of revenue,

which are not treated in other reports, have been treated in it. For Example Rent, Fare, Extra

advance and re-back reservation system charge, and Computer Charges.

Report No 5 (R5)

Credit for Embassy & Customers: PIA offers credit to different organizations, Embassy and

Customers. When sale is made on credit and when this credit amount is recovered then it is

reported in R5.

Report No 6 (R6)

Refund: When the customers who purchase the travel ticket and cannot use the ticket and want

to refund it. Then these tickets which are refunded are reported in R6.

Report No 7 (R7)

Due Payments: When any Payment is due on the client and he made the payment in other

station. When it is received in the origin station then it is reported in R7.

Report No 8 (R8)

Sales on Credit: PIA offers credit to different organizations, Embassy and Customers. When

sale is made on credit then credit sale is reported in R8. There is a programmed in the computer

that when the credit amount is received and reported in the R5 then automatically it is washed

from R8.

Report No 9 (R9)

Programmed Reports Transferred into R-9, from R-1, R-2: R-9 is consolidated statement of

all receipt. There is a program in the computer that when the cash is reported in the other reports


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like R1, R2 etc. automatically this cash is transferred into R9. R9 is used for the reconciliation

purpose. That all cash collection is reported in this report then reconcile with the Passbook.

Report No 10 (R10)Agents Reports: PIA authorizes some agents to issue the tickets. When the agents sale reports

have been received then it is reported in R10. R10 consist of two type of sale.

International Pax Sale

Domestic Pax Sale

There are three types of agents, which deal in passenger ticket these are known as Pax

Agents.

DSAs: Domestic Sale Agents

Such agents sales only domestic tickets. They are allowed 5% commission.

IATA Agents

Such agents are registered agents. They sell tickets of each airline. They dealboth in domestic

and international tickets. They are allowed 9% commission on international sale and 5%

commission on domestic sale.

GSA: General Sales Agents

Such agents sell only PIA tickets. They are allowed to sell domestic as well as international

tickets. They are allowed 9% commission on international sale.

Report No 11 (R11)

Cargo Sales from Agents: PIA authorizes some agents for cargo sale. When the agent cargo

report is received then it is reported in R11. R11 consist of two types of sale.

International Cargo Sale

Domestic Cargo Sale


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Revenue Department

As PIA main business is selling of Air Ticket. PIA has a very modern and fast working system of

ticketing. All the Reservation and Ticket system is computerized. All the cash sale is deposited

in the corporation on daily basis. There are different types of sales:

Cash Sales

Credit Card Sales

Sales to Defense Personal against voucher

Incentive Ticket to different Client and Agents

Staff Rebate Tickets.

Cash Sale

Cash sale are banked on daily basis and bank slips along with sale reports of the same day aresent to the revenue section where staff working made on initial audit of the report and the

deposited into the bank. That amount is accounted for in a source named R-1. This accounting

circle revolves till the monthly closing course.

Credit Card Sale

All the credit card sales are sent to Revenue Section on daily basis and there are sorted and

listing is made for billing to the concerned bank. When Cheque of credit sale is received it is

deposited into bank and banks credit it to the PIA Account.

Sale to Defense Personals

As per Government of Pakistan Rules Army men has to pay 50% Fare Remaining 50% will be

recorded from the army through a lengthy billing procedure. All the daily sales to Army personal

are received in revenue section and the handed over to another section dealing all the credit sales

named Credit Control Section.Army men travelling on official duty travel against an APW is

issued by their authority. APW mean Air Passage Warrant. These APW are also deal by credit

control section.

Incentive Tickets to Different Clients

When an agent makes a satisfactory sale. He also claims it for a rebated air ticket. Some

passengers are VIPs and regular travelers or from commercial points of view PIA management


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feels they are valuable such persons are awarded with incentive tickets. Such tickets are

accounted for by the H.O.

Staff Rebated Tickets

Like all other organization PIA employees are awarded Free/Rebated Air Tickets. All above

sales are received in the revenue section along with their support there they are sorted out and

accounted for all their merit after all job is completed all the supporting paper are found correct

and properly attached. These reports are sent to H.O. for another audit by the staff working in

H.O. All the sales A/C are reconciled on daily basis.

Reconciliation of DOM R-I with respect to TAC, APW, AMEX, Visa etc

Reconciliation of INT R-I with respect to AMEX, Visa, Exchange tickets/Other Airline Tickets,

extension of validity & DADS tickets.Checking of DOM Documents

Checking of INT Documents

Collection of all sales proceeds at the counter

Feeding Deposit Slips of R-I (DOM) R-I (INT)

Reconciliation of Collection Account.

Preparation of INT R-I (through COSSAP III).

Preparation of DOM R-I (Manually)

Realization of Credit Card Sale and its reconciliation.

All other duties, which can be assigned when, required.

Documents Control Section

As PIA function is to sell Air Ticket and carry cargo fr