Tarom witnessed 11% decline in passenger traffic in Q1, this year, due to the conflict in the Gulf and to the SARS (Severe Acute Respiratory Syndrome). In case the current situation in the aerospace industry worsens (if the war in Iraq takes longer than expected), Tarom's goal to keep within $14.5 million in losses in 2003 will be revised, Transport minister Miron Mitrea said yesterday.
"A very important issue that might also impact on the company is the trend of the oil price. However, we are still on schedule, " Mitrea added.
The company ended 2002 with approximately $25 million losses. Tarom's losses were cut down to $38 million in 2001, from the $62 million posted in the previous year.
According to the restructuring programme devised together with the World Bank, Tarom will manage to make $4 million profit in 2005. To that end, it has to cut maintenance costs, stop operating unprofitable destinations, concentrate its activity on a single airport - Otopeni, renegotiate contracts with the sales agents and strike deals with other airlines.
"The ministry will only provide as much as managerial support, but no funds to help it operate," Mitrea added.
He said Tarom had been one of the European airlines "best positioned on the market" last year, considering it got no subsidies from the state, unlike other operators.
At the same time, the company officials announced Tarom was negotiating an about $6 million contract for repairs on 10 Boeing 737 a year.
"We are currently performing a series of maintenance and repair works on an Hercules-type plane of the National Defence Ministry (MApN) and on the aircraft of the President of the Togo Republic," Sever Bucur, technical manager of the company said.
He added Tarom was to participate in a MApN tender for repairs and maintenance on other aircraft.
"We already have a contract concluded with the Army, worth millions of dollars and have the necessary technical capability to handle such works. We are also trying to land contracts with the US military," Bucur specified.
He says routine checks, maintenance or repair works usually cost $10,000 to $1 million.
Tarom was certified by the US Federal Aviation Administration (FAA) as capable of performing works on Boeings.
The Romanian air carrier will invest some $2 million this year, in order to modernise the hangar used for aircraft maintenance and repairs.
"The funds will be used to buy air conditioning systems, curtains to separate the painting section and a heating system," Tarom's technical manager said.
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