Nepal Airlines to say bye bye to its last Boeing 757, auction notice on Friday

Kathmandu , June 13th 2019

Nepal Airlines will be issuing an auction notice for its remaining Boeing 757 on Friday as its board has approved in principle the proposal to retire the vintage jet. When the aircraft flies off into the sunset, it will mark the end of the Boeing era in Nepal that began nearly five decades ago.

The state-owned carrier also plans to auction off the Boeing’s spare parts as it will now have an all-Airbus fleet. The national flag carrier said that it had set the minimum sale price at $7.8 million for the 31-year-old Boeing named Gandaki with registration number 9N-ACB and its spare parts.

The jet is valued at $5.4 million out of the total sale price, the carrier said.

The Boeing 757 joined the fleet of the then Royal Nepal Airlines in September 1988. This special Combi model is capable of seating passengers and carrying two pallets of cargo. According to Nepal Airlines, the Gandaki’s frame is the only pure 757 Combi built by Boeing.

“An expert committee has been formed to auction the Boeing. The auction notice will be issued on Friday,” said Madan Kharel, executive chairman of Nepal Airlines. “It’s a long process. We have to give 45 days for potential buyers to submit their bids.”

Nepal Airlines had said that it would retire its last Boeing 757 after doing an engine overhaul, technically known as C-check, as this can significantly affect the aircraft’s resale value, but it abandoned the plan. Normally, the C-check should be done every 3,600 flight hours or 15 months, whichever comes first.

The Gandaki was due for a C-check in February-end. The aircraft has been sitting at Tribhuvan International Airport since then. “The Boeing was due for a C-check, but we decided not to do it because it will cost us Rs200-250 million,” said Kharel. The national flag carrier had planned to put up its last Boeing for auction immediately after the arrival of the Airbus A330s last year, but it dropped the plan following allegations of financial irregularities in the purchase of the wide-body jets.

The Nepal Airlines board also hesitated to make a decision to allow the management to sell its Boeing after the allegation. Nepal Airlines has completed a full appraisal of the Boeing 757 including spare parts and tools. In November 2016, it picked Fintech of Geneva, Switzerland to make an evaluation of the aircraft. The carrier sold its first 757 named Karnali to Bhawan Bhatta, managing director of BB Airways, for $1.46 million in December 2017.

Nepal Airlines entered the jet age in 1972 by acquiring a Boeing 727. People would rush to their roof-tops to watch in awe as the sleek craft came in screaming from beyond the hills. Carrying 123 passengers, it connected Kathmandu with regional destinations and remained in service till 1993.The first Boeing 757 named Karnali and bearing registration number 9N-ACA, arrived in 1987. Gandaki was delivered the following year. The 757 holds 190 passengers. It is a mid-sized, narrow body twin-engine jet built by

Boeing Commercial Airplanes. It was in production from 1981 to 2004.

Nepal Airlines decided to sell off its two 757s as it was no longer profitable to fly them due to their high maintenance costs compared to the revenue they bring in, airline officials said. Each Boeing earns about Rs1 billion annually, and it costs the carrier almost the same in maintenance expenses. The plane’s high fuel consumption is another matter of concern for the state-owned airline. According to Nepal Airlines, the Boeing 757 burns 4 tonnes of fuel per hour, compared to 2.5 tonnes for the Airbus A320 aircraft. The corporation currently possesses two 158-seater A320 jets delivered in 2015, and two 274-seater A330 jets delivered in 2018, in its international fleet.

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