Kuwait Airways (KU, Kuwait) backer, the Kuwaiti government, has refused to cover the airline's over KWD145 million (USD491 million) in losses incurred over the past two years. According to the Kuwait Times newspaper, Finance Minister Anas Khalid Al Saleh says that as the airline is now a private company, it should therefore handle its losses like any other commercial operation.
In August 2013, the Kuwaiti parliament passed legislation allowing for Kuwait Airways to be privatized. Once the process has been finalized, government plans to hold a minority 20% stake in the airline with 35% to be offered to local firms, 5% to Kuwait Airways employees, and 40% to Kuwaiti citizens.
Airline executives claim, however, that as the process of privatization has yet to be completed, so government should help bear the costs incurred in its operations. Talks, therefore, are due to be held between Treasury and the airline about Kuwait Airways' budget for its upcoming 2015/2016 fiscal year, expected to be its largest ever.
“We are now in the final step of establishing the legal entity of the airline — the Kuwait Airways Company from the present Kuwait Airways Corporation. This will also see new bylaws along [with] many other new features [being introduced]," Abdulla al Sharhan, CEO, Kuwait Airways, said.
In addition to its restructuring, Kuwait Airways is also to be refleeted with ten B777-300ERs from Boeing (BOE, Washington National) and ten A350-900s and fifteen A320neo from Airbus (AIB, Toulouse Blagnac). As an interim measure, the airline will also lease twelve aircraft from the European manufacturer, including A320-200 (SL)s and A330-200s, which are due to make their debut in August on the airline's Kuwait to Frankfurt International via Geneva service.
