Novoair to continue flights despite struggles to survive  

Novoair will continue operations, despite whispers circulating on social media suggesting that the private carrier would cease operations from 20 April this year, the airline authority said.

The airline is currently struggling due to lower-than-expected business performance, which it attributes to inadequate policy support from the government, airline sources said.

"We are in a special situation. We needed to suspend flights for inspection. That's why we were preparing to halt operations temporarily. But for now, that won't be necessary. We are continuing normal operations,"  Group Captain Mofizur Rahman, Managing Director of Novoair, told The Business Standard.

According to airline sources, the company interested in purchasing Novoair's old aircraft was scheduled to visit on 19 April for inspection.  

As per regulations, flights must be suspended a few days before such inspections, so the airline had initially prepared to halt operations. Several advance-booked tickets were even cancelled.

However, the authorities worked to ensure that the planned aircraft sales would not disrupt operations. 

As the inspection was eventually postponed, flights will continue as usual, the airline confirmed. 

Following the rumours of the airline's closure, internal sources say employees became disheartened. Novoair currently employs more than 600 staff members.

Regarding the sales of the aircraft, Mofizur Rahman said, "There is currently no process underway for purchasing new aircraft. We will have to sell our old ones sooner or later because the investment required to keep them operational is not commercially viable for us."

"We are exploring all options to replace them with new aircraft. But that will take time. There is currently a shortage of aircraft in the global market, which has added to our challenges." he added.

Previous plans and fleet status

Earlier, in June last year, it was reported that Novoair planned to sell its entire fleet of five ATR 72 aircraft to make way for newer planes suited for international routes.  

In January 2024, the airline sold two ATR 72s to Yeti Airlines of Nepal, citing a significant drop in domestic passenger numbers.

The ATR 72, a French-made turboprop aircraft, is typically used for short-haul routes and can carry up to 78 passengers. Novoair currently uses these aircraft for its domestic flights.

Novoair had been planning to acquire three Airbus aircraft to expand to international destinations such as Bangkok, Kuala Lumpur, and Singapore.  

However, the deal ultimately fell through due to the unavailability of aircraft, sources said.

At present, Novoair mainly operates domestic routes. The airline had one international route to Kolkata, India, which has been suspended since 5 August following political changes and a passenger crisis.

The airline now operates daily flights from Dhaka to Cox's Bazar, Saidpur, Chattogram, Jashore, Sylhet and Rajshahi.

Additionally, the inauguration of the Padma Bridge in June 2022 significantly reduced demand on routes like Dhaka-Jashore and Dhaka-Barishal.  

Due to low passenger numbers, Novoair discontinued its Barishal route.

Why is the airline struggling?

Novoair began operations in January 2013, primarily focusing on domestic passengers.

"When we launched flights, the government-imposed tax was Tk529. That has now risen to Tk 1,125. So, from a ticket priced at Tk4,700, we pay nearly 24% in taxes,"  said a Novoair official on condition of anonymity.

"In addition, jet fuel makes up about 40% of our total costs. The agencies selling our tickets receive 7–8% commissions. Beyond that, we have maintenance and operational costs," he added.

 "Amid all these challenges, we don't have consistent passenger loads throughout the year. So you can judge how an airline can survive without proper policy support," he concluded.

Earlier last year, Novoair's managing director told TBS: "When we started the business in 2013, it was decided that Biman would not operate domestic flights. This decision was made in 2007 by Biman's board due to consistent losses on domestic routes."  

"But from 2014, Biman resumed domestic operations, using large aircraft like Boeing 777s and 787s. This poses an existential threat to us. I can guarantee that no new private carrier can survive in such a situation."

GMG Airlines, United Airways, and Regent Airways are all examples of private airlines in Bangladesh that shut down operations due to mounting debts, aviation analysts say.

Additionally, the combined effect of the Russia-Ukraine war and the lingering impact of Covid-19 has driven jet fuel prices higher, compounding the challenges for airlines.