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Mozambique Airlines may cut fixed costs

Mozambique Airlines (LAM) hopes to cut fixed costs and negotiate the delay or reduction of mandatory charges with aircraft rental companies.

Speaking on Saturday on the Radio Mozambique ‘Direct Line’ programme addressing measures under the state of emergency in force since April 1, LAM director-general João Carlos Pó Jorge said the company had to pay fixed costs such as wages, rents and, most expensive, aircraft rental.

“Airlines across the world are, in general, going to need financial support in one way or another. Obviously, the first step to take is to cut fixed costs and negotiate the postponement or reduction of mandatory costs with companies,” he said.

Since the coronavirus outbreak in the Chinese city of Wuhan in December, LAM’s revenues have fallen from US$8 million to US$1 million a month.

The Mozambican airline previously carried an average of 40,000 passengers per month, which number has fallen to around 12,000. LAM has also suspended about 200 international and regional flights, jeopardising the company’s operation to a certain extent.

Pó Jorge called on Mozambican companies to make plans for their post-pandemic recovery, which they will very much need.

The coronavirus outbreak began in China in December 2019, and spread to more than 146 countries and territories, leading the World Health Organization (WHO) to declare a ‘pandemic’ crisis situation.

Source: Notícias via Club of Mozambique

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