Tunisair threatened with bankruptcy
Tunis, Tunisia (PANA) - Faced for several years with acute financial difficulties due, in particular, to a plethora of employees and an aging fleet, Tunisair is now going through an unprecedented crisis, jeopardising its survival.
The closure of airspace due to the coronavirus epidemic has worsened the situation, so much so that the spectre of bankruptcy now hangs over the national carrier, according to its Director-General, Elyes Mnakbi.
The airline, which transported more than 40pc of the estimated nine million tourists who visited Tunisia in 2019, has suffered a backlash from the halt in air traffic.
Elyes Mnakbi estimates that the economic impact of the health crisis on Tunisair's business has resulted in a revenue shortfall of around 150 million dinars (about US$50 million).
Simply to pay May's salaries, the company needed 100 million dinars (about more than US$33 million).
The boss of Tunisair has raised the threat of the technical unemployment of a large number of employees in the coming months.
"Without a rescue plan, survival is only a matter of weeks," he warned.
Speaking before Parliament in late April, the Minister of Transport and Logistics, Anouar Maarouf, described the situation in Tunisair as "catastrophic", which requires "deep reforms, sacrifices, bold decisions", referring to the corruption which he said was widespread there.
Already in late 2018, Tunisair had a debt of more than 350 million euros, half of which would be due to the Office of Civil Aviation and Airports (OACA).
One of the main factors is excessive wage costs due to overstaffing of employees.
The company has some 7,800 agents and executives, while it needs only 2,000, according to international standards, experts say.
To ease the burden, the company's management has come up with a restructuring plan that calls for the severance of only 1,200 employees.
At an estimated cost of one billion dinars, about more than 300 million euros, the plan also calls for upgrade reforms, in anticipation of the upcoming entry into force of the Open Sky agreement signed with the European Union, which would open the Tunisian skies to more powerful foreign companies and which, according to the trade unions, would bring the coup de grace to the national carrier. , all of which meant that the plan did not receive government approval.
The company's other major asset is its aging fleet (28 aircraft with an average age of 15 years) and aircraft that are often immobilized and removed from traffic, as the company cannot afford to purchase the spare parts.
The majority of Tunisair's capital is held by the Tunisian State 64.86pc, 5.58pc by Air France, 9.56pc by three Tunisian social funds and 20pc by smallholders via the Tunis Stock Exchange.
-0- PANA BB/JSG/BBA/VAO 16May2020
