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TAROM estimates 49 million lei losses and considers firing personnel
TAROM national air transport company will reduce this year losses to 49 million lei from 110 million lei in 2014, and takes into account to reduce personnel next year.
“For this year we estimate losses of 49 million lei, but the EBITDA indicator is positive, around 12.5 million euros, which gives us big hope for the future. From the accounting point of view we are still talking losses, but let’s not forget that in 2011 they amounted to 260 million lei. In order to boost results we had a higher fleet use, which means costs with aircraft are divided for more hours. The same happens with technical staff. In aviation the more you fly the more costs are reduced. So we fly more than last year and costs per flight hour dropped. Moreover we have a more advantageous fuel price,” said Christian Heinzmann, general manager of TAROM in a statement to Mediafax.
He pointed out that the business figure will be around 300 million euros this year and next year TAROM incomes will have a value close to that of expenses, the company obtaining operational profit no later than 2017.
The average occupation degree of TAROM planes is 68%, while kerosene expenses mean 23-24% of overall costs, compared to 30-35% before collapse of oil.
According to Heinzmann, TAROM has about 2,000 employees and the company takes into account personnel cuts.
“The company has great potential. We will not hire personnel and will occupy those positions where it is strictly necessary - pilots and technicians. We want to become more efficient. If we see oversized departments we will see how to solve the problem by reducing personnel. This is part of the strategic plan,” the TAROM director said.
TAROM management is working on a procedure for employee evaluation and will develop a new strategy which will bring changes within the company, one of them being lee bureaucracy in air transport.
“We will develop and implement a new strategy. We consider all expenses made by the company. We want to hire a strategic partner, to assist the evaluation and development of company activity. For us it will be more a proof of objectivity. We will work on changes within TAROM, but we want a foreign consultant to guide us. In Romania there are 20 million aviation specialists but we want a true specialist to tell us what is good or bad. As you know, we are a very bureaucratic company. For that reason, we waste much time and energy. We will review all procedures in order to become more efficient. We are burdened by legislation, controls, administration and we want an efficient internal organization like a private one, “Heinzmann said.
He pointed out that he wants a re-evaluation of the whole TAROM portfolio.
“We analyse our participation in Alpha Rocas (the company ensuring catering services for TAROM), we want to see if we are doing the right thing, we will consider all our assets, like the building we have here, to see whether we need it or not. If not we will sell it,” the TAROM CEO showed.
In his turn, Tiberiu Ticlea, a member of the Administration Board and administrative general director of TAROM says the air operator will register significant changes to act like a private company.
“This supposes three aspects: firstly we have the commercial culture, to change the philosophy of doing business, sales, marketing; secondly we are talking about financial culture, to finance ourselves, from our own sources or from the market and not to ask any money from the state; thirdly - organizational culture, to make procedures more flexible and accelerate internal processes to the maximum. There are significant problems about the last aspect: parallel structures with no particular aim in the company, departments among which there is no dialogue and which we want to unite. We also have departments which do not do what they should. That is why we will soon apply a new organization,” he said.
TAROM has 2,000 employees and carries out its activity under the authority of the Ministry of Transports, and has been a member of the SkyTeam alliance since 2010.
The national companies operates over 50 destinations of its own and destinations served by code share partners.