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March 23, 2023

Tarom, EUR 244 M worth of aggregate loss in 2008-2012

The Tarom private management has to plug a EUR 244 M aggregate loss ‘hole’ for  2008-2012, according to the company’s business plan for 2013-2016 “thought” by the company’s private management picked by the Transport Ministry late last year, according to money.ro.The report shows the aggregate loss the company incurred during the past four years amounts to nearly RON 836 M, “which led to the quick deterioration of the company’s cash reserves, which has failed to register a positive cash flow since 2009”. Even worse, from 2008 onward, almost all the routes lost money, a situation generated by severe imbalance between revenues and spending. While Tarom has costs specific to a “full service” company, its profit however only fits that of a low-cost carrier,” according to the Tarom management plan. Aside from reexamining the route network, operating programs, reconfiguring employee duties, organizing new work processes and sales operation, the private management at Tarom also takes cutting losses into account by selling and renting out some of the aircraft. Also, the new Tarom management seeks to outsource the technical service. Although the company closed the year in the red, Tarom managers “dream” of the airline making profit in 2016.

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