CASE STUDY

Nepal Airlines Corporation (formerly known as Royal Nepal Airlines Corporation), set up in July 1958 with Douglas DC-3 Dakota Aircraft is the national flag carrier airline of Nepal. From last several years NAC is in financial crisis at a time when private sector airlines are earning big profits.

Although NAC is still operating its activities internationally and domestically but its progress has not been perceived satisfactory. It has less aircraft than it used to have before. The Corporation itself is disorganized and besmirched. The political system is volatile as there is no safe environment for airline operation. As the demand is soaring for migrant workers the NAC itself cannot commit to buy planes to enlarge the service again as it has bought two Airbus just couple of years ago. Making that much huge amount of expenses frequently is not feasible job. Its failure to provide quality service and time to grounding of aircraft is another problem the industry is facing. Furthermore poor service quality and comparatively high freight charge is causing people to think twice in its selection. Considering present scenario try to answer given questions-

1. What are the reasons of causing NAC financial crisis? Is this because of any external factor?
2. Having more than six decades long service experience why national flag carrier could not make its growth and expansion?
3. What you would like to say regarding huge investment to add two air bus but unable to meet soaring demand for more flights?
4. Why airlines' management could not make profit even fixing comparatively high freight charge? Which internal factors are playing their role for this?
5. Give some suggestion to improve NAC present situation.