Lufthansa Consulting approaches with a hefty amount to become NAC’s strategic partner

Lufthansa Consulting, an aviation and management consulting company, has shown interest on becoming the strategic partner of Nepal Airlines Corporation (NAC). It has come up with a hefty fee of Rs688.67 million for the services it will be dispatching in different phases.

According to the proposal, Lufthansa will be operating in three different phase namely diagnostic assessment, restructuring plan and finally implementation phase. The Lufthansa consulting has projected an amount of Rs246.75 million for first phase lasting for four weeks and second phase lasting for five months whereas fee for implementation phase is allocated Rs338.62 million which will last for three years. Also, Rs103 million will be the income tax on the above mentioned amounts.

Tourism, Culture and Civil Aviation Ministry of Nepal had preceded the procedure to appoint German Aviation Company Lufthansa as the strategic management partner of Nepal Airlines. The ministry had addressed the proposal to Finance Ministry for its suggestion on the appointment of Lufthansa as the strategic partner for national flag carrier of Nepal. The final decision is yet to be made.

The ministry had requested for sealed bids from various airlines through their embassies in Kathmandu where Lufthansa was the only and sole bidder for the tender. Embassy of Australia, France, Germany, U.K and U.S.A were forwarded the tender proposal to attract the proper strategic partner for NAC. But Lufthansa from Germany was the only interested bidder to take on the strategic partner.

Ministry of Civil Aviation after receiving the bid from Lufthansa had conducted their study on the drafted quotation. The evaluation committee appointed by the ministry had declared Lufthansa to be the qualified strategic partner for Nepal Airlines.

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Previously on 2015 during the Ministry tenure of Late P.M Sushil Koirala Lufthansa had drafted and addressed its proposal willing to take on the strategic partner of Nepal Airlines at the P.M office in Baluwater. Finance Ministry then had denied the proposal of Lufthansa analyzing its demand for  3% income of NAC being the strategic partner.

Fiscal year report for 2072/73 denoted that Nepal Airlines till date bearded a heavy debt of 1 billion 82 million and 9 hundred thousand Nepali Rupees. The board of Ministry has been blaming the management of the flag carrier of Nepal for the heavy debt and loses. So the Ministry has decided to hand over the responsibility of the strategic management of Nepal Airlines to an appropriate and qualified foreign partner to overcome those heavy debts and losses.

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