7 December AFP

Iran to merge airlines, semi-privatise state carrier


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Iran is to shake up its airline industry, opening state carrier Iran Air to the private sector and merging small companies into a second large airline, national aviation chief Behzad Mazaheri was quoted as saying Friday.

"We are going to merge our small companies into one large private company and open up Iran Air to private capital, creating a new national semi-state firm", state radio quoted Mazaheri, director of the Iranian National Aviation Organisation, as saying. Mazaheri gave no other details of the decision.

Apart from Iran Air, the country has a dozen small airlines mainly serving the provinces with leased Russian aircraft, which were set up after the end of the Iran-Iraq war in 1988.

Iran Air has been in financial difficulties for several years, and has problems servicing its fleet made up largely of ageing Boeings because of a US trade embargo on Iran.

Since the terror attacks on the United States on September 11 business has fallen off, with revenue falling 20 to 30 percent, leading to cancellation of several international flights for lack of passengers. In October Iran Air announced a 21 percent rise in domestic air fares.

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