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The Nation's second flag carrier: A brief history of Sri Lankan Airlines

The airline serves over 40 destinations.


SriLankan Airlines, which was formerly known as Air Lanka, is the often-overlooked flag carrier of the South Asian island nation Sri Lanka and is an active member of the one-world alliance. Currently, the carrier stands as the largest carrier in Sri Lanka both by number of destinations served and by the size of the carrier's fleet.


The airline traces its history back to 1979 when the Sri Lankan government founded it after the country's first flag carrier, Air Ceylon, folded. The airline was the target of a partial acquisition by Middle Eastern legacy carrier Emirates in 1998. The airline was subsequently rebranded, and a new livery was introduced.


By 2008, the government had reacquired all shares from Emirates and began to grow quickly and expand into a carrier that operates over 560 weekly flights across Asia today. In this article, we will take a deeper look at the history of SriLankan Airlines and where the airline stands in the market today.


A bumpy launch


The launch of Air Lanka did not go off without some controversy surrounding a number of management decisions made regarding the carrier. Like most state-owned and operated flag carriers, the decision to establish a new national airline and who to put in charge of it were in the hands of the country's government.


In 1979, the nation's president, Jayawardene, entrusted the management of the airline to a pilot, Captain Rakitha Wickramanayake, about whom there were significant doubts. As a pilot, many doubted his ability to adequately manage the airline, something which a 1986 Presidential Commission confirmed.


Despite its controversies, the airline had been able to commence operations and establish itself as the nation's new flag carrier in the wake of Air Ceylon's collapse, according to the Financial Times. The carrier began operations with leased Boeing 707 and Boeing 737 jet aircraft, and widebody operations first took place in 1980 when the airline leased Lockheed L1011 Tristar three-engine aircraft.


.The airline would continue to grow its fleet in the coming years, acquiring new widebodies from Japanese legacy carrier All Nippon Airways (ANA) and later introducing the Boeing 747 for a short operational period between 1984 and 1987. In 1994, the airline made the headlines by becoming the first Asian airline to operate the Airbus A340-300, a launch that demonstrated the carrier's continued dedication to modernization despite consistent management challenges.


An Emirates-sponsored rebranding


By 1998, Sri Lanka's government attempted to semi-privatize the state-owned flag carrier, Air Lanka, offering a 40% stake to the Emirates Group, an investment that totaled over $70 million. The massive partnership offered Emirates exclusive rights to both ground handling and catering at the carrier's Bandaranaike International Airport (BIA) in Colombo for over a decade.


In the wake of this new management decision, the carrier soon rebranded as Sri Lankan Airlines and introduced a new livery while also expanding its fleet. The airline quickly acquired Airbus A330-200 jets, which offered improved fuel efficiency over older-generation quad jets, and upgraded its A340 fleet to include the latest models.


The company also introduced a number of new routes, most of which focused on increasing connectivity to important regional markets in both India and the Middle East. By 2008, Emirates had grown disappointed by the returns on its investment in the carrier and chose to end its partnership primarily due to disagreements in contract negotiations over control of the carrier. Officially, the carrier sold its ownership stake back to the Sri Lankan government in 2010, according to The Economic Times.


Since 2010


When Emirates officially withdrew from the carrier in 2010, the airline had finally begun to turn a consistent profit. However, the airline's good fortune vanished quickly, incurring large losses between 2010 and 2015, on account of increasingly ill-fated management decisions.


Nonetheless, the carrier still pursued expansion, looking to establish its Colombo base as a regional flight hub with new routes to cities in China including both Shanghai and Guangzhou. Shortly after, in 2014, the airline joined the one-world alliance and established a modernized fleet of A320 and A330 family twinjets.


The company finally retired its final A340-300 in 2016 with a service between Colombo and the Indian city of Chennai, and the airline shortly after launched flights to Melbourne in 2017. The airline struggled during the COVID-19 pandemic, and incurred heavy losses requiring drastic cuts to staffing.


The airline also became a victim of Sri Lanka's extensive economic crisis, which has led to fuel shortages and higher costs across the company's network. With fuel shortages beginning to require stopovers during ultra-long-haul flights, the carrier has become significantly less competitive in certain key markets. According to its 2023 annual report, the airline's operations still remain extensive today and the carrier's fleet aircraft includes six Airbus A320-200’s, two A320neo’s, four A321neo’s,two A330-200’s and seven A330 -300’s.


Despite challenges over the past decade, the carrier has seen some positive signs in the past few years, including breaking even for the first time in nearly ten years in 2022 by posting a net profit of over $3 million. The airline's service offerings have also become the subject of international accolades, including the 2024 IFSA award for best in flight food at the Airline Passenger Experience Association Global Exposition in October 2023.


Source: Simple Flying


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