The Kenya Association of Travel Agents (KATA) and various other associations under the umbrella body Kenya Tourism Federation (KTF) came together through a webinar to discuss measures of business survival during and after the COVID-19 crisis.

The associations explored the continuous devastating impact on the industry in finance, human resource and business continuity and ways of emerging from the crisis stronger.

KTF Chairman Mr. Mohammed Hersi noted that the longer the disease lasts, the longer it will take to revive the industry and the economy at large.

Chief Administrative Secretary (CAS) for Tourism and Wildlife Mr. Joseph Boinett, who was also in attendance, urged the travel and tourism industry players to pull together as the world seeks ways of getting rid of the highly contagious virus. “The post COVID-19 world will be new and different,” he pointed out.

KATA Chief Executive Officer Ms. Agnes Mucuha pointed out that the travel trade is hedged on transport and for it to thrive, international borders need to open up.

This, she further said, is the reason why the aviation and travel industry has a bleak future as no revenue is streaming in.

Since the first case was reported in March, several measures have been put in place by the government to contain the spread of the highly contagious disease.

Among them is social distancing, restricted movements amongst counties, a dusk to dawn curfew and no flights in and out of the country, measures that have been extended for another 21 days.

These measures though very necessary in preventing the rapid spread of the virus have affected businesses through loss of sales and revenue. This has led to some companies having to reduce the number of staff and even closing down.

“Some airlines like South African Airlines and Air Australia are going through insolvency. If airlines do not receive support from their governments, they will go bankrupt,” Ms. Mucuha said.

She called upon government and corporates to pay up pending funds owed to travel agents to allow their businesses to survive the crisis.

“There are some companies that will not survive the Coronavirus pandemic. The government needs to support these businesses. Instead of closing shop, these businesses can partner for survival and later make a comeback post COVID-19, “she advised.

Travel agents, she continued, may have to rethink their business strategy and cease extending credit in future for business sustainability.

On human resource matters, the Kenya Association of Hotel Keepers and Caterers (KAHC) CEO Mr Mike Macharia talked about the options businesses have with their staff which are within the law. These include paid and unpaid leaves, and pay reductions, all of which, he emphasised, have to be agreed on by the employer and employee.

Jambojet has a new Managing Director, Mr Karanja Ndegwa, who is also the airline’s Chief Financial Officer.

He takes over in an acting capacity from Mr. Allan Kilavuka who was appointed Kenya Airways Chief Executive Officer and Managing Director in February this year.

Jambojet Board of Directors announced on Monday that Mr. Ndegwa will take up the role from Friday April 30, 2020.

Jambojet Board Chairman Mr. Vincent Rague thanked Mr Kilavuka for his dedication in serving the local airline as he welcomed Ndegwa into his new role.

The Kenya Association of Travel Agents congratulated Mr Ndegwa and wished him success especially now that the travel and aviation industry is grappling with the effects of the highly contagious COVID-19.

“His appointment is a clear indication of the confidence that the Jambojet leadership and the whole travel industry has in him. This stamps his exemplary service to the airline over the years. KATA will continue to support the new leadership and we are confident the partnership that has existed between our two organisations will continue to thrive as we strive to boost the growth of travel in Kenya”, KATA Chairman Mr Mohammed Wanyoike said.

Mr. Ndegwa is a graduate of Economics and Statistics from the University of Nairobi and also a Certified Public Accountant. He has over 20 years in experience in the aviation industry, 12 of which have been in leadership roles.

Before joining Jambojet in 2014, he worked at Kenya Airways in various positions.

Meanwhile, due to the extension on cessation of movement by the government for the next 21 days in and out o Nairobi, Mombasa, Kilifi and Kwale Counties, Jambojet has temporarily suspended its operations until May 20, 2020.

The local carrier encouraged its passengers who have booked travel within the suspension period to reschedule their travel at a later date at no cost adding that the ticket value remains for a period of one year from May 1, 2020.

 

KIGALI (Reuters) – Rwanda’s RwandAir will cut the salaries of its lowest paid employees by 8% and by 65% for its top earners as it seeks to survive the coronavirus crisis, an internal memo seen by Reuters on Sunday showed.

The carrier, which flies a fleet of 12 Boeing and Airbus planes to 29 destinations across three continents, has been one of the rising stars in Africa.

In February, Qatar Airways said it was in talks to buy a 49% stake in the airline.

“We considered several other alternatives and the choice we made is the best option at this time,” RwandAir’s management wrote in the memo, which two employees told Reuters they have received.

The management of the young airline, which is owned by the government and has not yet made a profit, could not be reached immediately for comment.

Airlines around the world have been forced to ground their planes after governments imposed travel restrictions and closed borders to slow the spread of the COVID-19 pandemic.

Air Mauritius said this week that it has entered voluntary administration due to the crisis, joining Virgin Australia and South Africa Airways who have called in administrators.

Source: https://af.reuters.com/article/investingNews/idAFKCN2280EY-OZABS

 

Dubai, UAE, 26 April 2020 – Emirates has ramped up its capability to process refunds, reaffirming its commitment to customers and travel trade partners impacted by travel disruptions caused by the COVID-19 pandemic.

With nearly half a million refund requests pending to manage, the airline has taken proactive steps to restructure its backend procedures and boost resourcing to accelerate the processing of refunds. Pre-pandemic, Emirates processed an average of 35,000 refund requests in a month. Now it is gearing up to handle 150,000 per month, and aims to clear its current backlog by early August.

Sir Tim Clark, President Emirates Airline said: “It is a difficult time for us, as it is for all airlines. We are dipping into our cash reserves by being proactive in processing refunds, but it is our duty and responsibility. We would like to assure our customers and trade partners that we will honour refunds, and that we are doing our best to speed things up.

“The situation was dynamic in the early weeks of the pandemic, but we have since re-written our COVID-19 waiver policy into a simple, globally-applied approach that puts customers first. We’ve also proactively contacted those of our customers who had submitted earlier requests for refunds or booking changes, to let them know of the new options available to them.

“We sincerely hope that our customers and trade partners will choose to book and fly with Emirates again at a later time. For those who have opted to hold their tickets or exchange it for travel vouchers, we look forward to welcoming you on our flights again soon. Announcements will be made whenever we are able to resume services.”

Customers who wish to request travel vouchers or refunds can easily do so via an online form on Emirates’ website, or contact their travel booking agent for assistance.

Emirates offers three options to its customers affected by flight cancellations and travel restrictions:

• Simply keep their existing ticket for up to 24 months, and call to reschedule their flight when they are ready to fly. Emirates has extended this option to apply to any ticket booked on or before 30 June 2020, for travel on or before 30 November 2020.
• Exchange the unused portion of their tickets for a travel voucher equivalent to the amount paid for their original booking. The travel voucher can be utilised for any Emirates product or service, with no change fees, providing customers more flexibility to reschedule when they are ready to travel again.
• Refunds. Customers who have opted to keep their ticket or opted for a travel voucher can still apply for a refund, if they are unable to travel. There will be no refund penalties.

Customers who have booked through travel agents should contact their agent for assistance. The same options will apply.

More information on Emirates’ waiver policy, and our latest flight and business information relating to COVID-19 can be found here: https://www.emirates.com/ae/english/help/covid-19/

Source: https://www.emirates.com/media-centre/emirates-reaffirms-customer-commitment-with-ramp-up-of-refunds-capability/

 

Expatriates in Kenya are paying up to three times normal ticket prices to return to their home countries as airlines provide charter flights for repatriation.

Foreign governments have organised for charter flights from firms, including Kenya Airways and Ethiopian airlines, which are charging a premium for the services.

Kenya Airways will Friday ferry passengers to London Heathrow from JKIA charging Ksh187,692 ($1,876) for the one-way ticket including testing for Covid-19 at Lancet. Normally, a ticket from Nairobi to London and back at this point of the year would start at Ksh96,430 ($964) or about Ksh48,215 ($482) one way.

“This is a charter flight. Under normal operations, the cost is spread out. Now it is concentrated on a few flights. There is also the extra cost of protection, cleaning and fumigation,” said Kenya Airways CEO Allan Kilavuka in a phone interview with Business Daily.

“We also have to ensure safe passage for crew if there is a layover. All these costs add up and there are no economies of scale.”

Mr Kilavuka added that the return flight would however not ferry any Kenyans back as “some processes are not complete for bringing people back. It is an ongoing process, but we will not bring back Kenyans this time.”

The airline is still in negotiations in government. In the original announcement, Kenyans were to fly back home on the flight on Saturday and be subject to a 14- to 28-day quarantine at government centres at their own cost in addition to the purchase of the ticket.

The Kenyan High Commission in the UK last week issued a notice indicating that KQ had given 211 as the minimum number of passengers for whom the flight could be arranged pending confirmation of viability of the flight.

Foreign governments have continued to evacuate their citizens including the European Union which organised a charter flight with Ethiopian Airlines that left for Frankfurt yesterday from Nairobi with the one-way ticket costing Ksh152,818 ($1,528). This would usually be the cost of a return trip during high season.

The flight had 263 available seats with no option of business or first class, no in-flight entertainment and no discount for children on infants.

ET also had a similar arrangement with the US government to evacuate Americans from Nairobi to Washington on Wednesday this week.

Source: https://www.theeastafrican.co.ke/business/Air-ticket-prices-increase-three-times/2560-5533088-11opwgnz/index.html

 

Geneva – The International Air Transport Association (IATA) announced that Sebastian Mikosz will join IATA as the Association’s Senior Vice President for Member and External Relations, effective 1 June 2020.

Most recently, Mikosz was Group Managing Director and CEO of Kenya Airways (2017-2019), during which time he served on the IATA Board of Governors. Prior to that he was the CEO of LOT Polish Airlines (2009-2011 and 2013-2015) and the CEO of Poland’s largest online travel agency, the eSKY Group (2015-2017).

At IATA, Mikosz will lead the organization’s global advocacy activities and aero-political policy development, along with managing the association’s strategic relationships. This includes IATA’s 290 member airlines as well as governments, international organizations and stakeholders in both the private and public sectors. Mikosz will report to the Director General and CEO and join the Association’s Strategic Leadership Team. He replaces Paul Steele, who retired from IATA in October 2019. Brian Pearce, IATA’s Chief Economist has been handling the duties of this post on an ad interim basis since then.

“Sebastian brings with him a wealth of experience in the public and private sectors that will be critical in advancing the global aviation industry’s advocacy agenda. At this time of unprecedented crisis, the airline industry needs a strong voice. We must restore the confidence of governments and travelers so that aviation can re-start, lead an economic recovery, and connect the world. Sebastian’s experience in launching and turning-around companies will be invaluable in helping IATA meet the expectations of our members, governments and stakeholders,” said Alexandre de Juniac, IATA’s Director General and CEO.

“I can’t wait to get started at IATA. Aviation is in crisis and all industry and government stakeholders have high expectations for IATA to play a critical role in driving the recovery. From my experience as an airline CEO and as a member of the IATA Board of Governors, I know how important IATA is to the global connectivity that we usually take for granted. Today’s challenges could not be greater. And, in joining IATA, I am determined to contribute to the efficient restoration of the links between people, nations and economies that only aviation can provide,” said Mikosz.

A Polish national, Mikosz is a graduate of the Institute of Political Studies in France with a Master’s degree in Economics and Finance. In addition to his airline experience, Mikosz’s career includes the positions of Vice President at the Polish Information and Foreign Investment Agency, Senior Advisor at Société Générale Corporate Investment Bank, Managing Director of the French Chamber of Commerce and Industry in Poland and founder of the online brokerage house Fast Trade. Mikosz speaks Polish, English, French and Russian.

Source: https://www.iata.org/en/pressroom/pr/2020-04-27-01/ 

The International Transport Workers’ Federation (ITF) and the International Air Transport Association (IATA) have called for support from governments to the aviation industry, to protect jobs and ensure that air services can be maintained.

The economic situation facing the aviation industry is severe. Air passenger demand is down by 80 percent. Airlines are facing a liquidity crisis which threatens the viability of 25 million jobs directly and indirectly dependent upon aviation, including jobs in the tourism and hospitality sectors.

In a joint statement, ITF and IATA called for governments to ensure that the protection of health workers caring for those with COVID-19 is prioritized and coordinate carefully between each other and with industry to ensure harmonized and effective action to protect the safety of passengers and crew.

The two organisations further called for governments to provide immediate financial and regulatory support for airlines, in order to maintain the sustainability of terms and conditions for air transport workers and assist the industry to restart quickly by adapting regulations and lifting travel restrictions in a predictable and efficient manner.

IATA and ITF also noted the aviation industry’s contribution to helping alleviate the COVID-19 crisis by keeping supply chains open, and repatriating citizens. Aviation professionals are also volunteering on the front line to assist medical services in the fight against COVID-19.

“Airlines are facing the most critical period in the history of commercial aviation. Some governments have stepped in to help, and we thank them. But much, much more is needed. Direct financial support is essential to maintain jobs and ensure airlines can remain viable businesses. And when the world is ready to start travelling again, the global economy will need aviation at its best to help restore connectivity, tourism and global supply chains. That will require a harmonized approach with industry, workers and governments working together,” Mr. Alexandre de Juniac, IATA’s Director General and CEO said.

“IATA and ITF have a shared goal to ensure a sustainable future for the aviation industry. In order to achieve this, we need urgent action now. It is crucial that governments understand the importance of the aviation industry in rebuilding the global economy and support the industry. Bold decisions are required to invest in the future of airlines and protect the jobs and livelihoods of the transport workers who will lead the economic recovery when COVID-19 has been contained. Workers and the industry have joined forces, we invite more governments to join us in a coordinated approach to keep the industry and its essential supply chains moving,” said Stephen Cotton, ITF’s General Secretary.

Link: https://www.iata.org/en/pressroom/pr/2020-04-20-01/

 

 

An international accounting and consultancy firm, Grant Thornton is offering advisory support to businesses during this COVID-19 pandemic.

The firm seeks to guide organisations put in place medium and long term business continuity plans to mitigate the effects of the current COVID-19 and potential future outbreaks while also considering the human resource, financial reporting and financing of the business while ensuring stability.

Grant Thornton helps organisations develop and implement continuity solutions that help maintain continuous operations in case of major unforeseen disruptions like in the case of the Coronavirus.

Solutions offered include the development of a business continuity plan and IT infrastructure audit.

The consultancy firm also offers human resource considerations by looking at potential challenges that are brought on by major disruptions and offering mitigation measures to each problem.

The firm has a capable financial reporting advisory team that assists the client to carefully consider the impact of disruptions like COVID-19 on financial statements through various interventions.

Grant Thornton also assists businesses in managing their cash while offering insights for the future by assisting with the development of short-term forecasting responses, long-term business forecast and sensitivity and scenario analysis.

For more information follow link: [dflip id=”7542″ type=”thumb”][/dflip]

Or contact Parag Shah, Partner – Advisory, on email parag.shah@ke.gt.com, FA Michael Chomba

Director – Advisory on email michael.chomba@ke.gt.com, Steve Bett Manager – Risk Advisory on email steve.bett@ke.gt.com and/ or Lynette Musyimi Manager – HR Advisory on email lynette.musyimi@ke.gt.com.

COVID- 19 has brought the travel and tourism industry to a complete standstill with the restrictions on movement to contain the spread of the virus. This virus has caused an unprecedented disruption in the aviation, travel and tourism industry.

The pandemic has led to stringent measures being taken by the Kenyan Government to contain the spread of the virus. On March 25, 2020, international flights were banned and before that, gatherings of any kind were prohibited therefore leading to cancellation of major conventions and events in cities.

The Kenya Association of Travel Agents Chief Executive Officer Ms. Agnes Mucuha noted that the aviation, travel and tourism industries are among the worst hit sectors.

“COVID-19 has hit the industry really hard with loss of jobs and revenue for travel agents. Many have had to close their businesses. The beginning of the year had so much promise. Kenya had recorded an increase in international arrivals after receiving 1,444,670 arrivals between July 2019 and February 2020 as compared to 1,423,548 over the same period last year,” she said.

Over 90 percent of forward bookings for the month of April 2020 have been cancelled since Europe, America and the Middle East issued lock down notices for non-citizens. Our industry forecast on bookings for the period May, June and July 2020 is also extremely depressed as travellers have opted to postpone their travel until quarter four

Other notable findings in the travel impact analysis include:

• Total spending on travel in Kenya in 2019 was Kes. 1.7billion on tickets, airline operating fees, and ancillary products and services. This has been projected to

plunge by 60% by the end of 2020.

• The estimated losses by the travel industry alone are severe enough to create job

loss across the sectors. The full impact of the crisis is expected to last at least three

quarters, with Q2 2020 being the low point.

These grim statistics mean that travel agents and other industries in the travel and tourism industry cannot support their employees or their businesses. This has seen many people take pay cuts, and others lose their jobs.

Ms. Mucuha pointed out that being a global pandemic, Africa will be greatly affected with the International Air Transport Association (IATA) predicting that the disruption to the aviation industry will cause a loss of about USD 113 billion globally and USD 55.8 billion in Africa. This industry supports millions of jobs which risk being lost. The figure could rise depending on how long the pandemic lasts.

The United Nations World Tourism Organisation (UNWTO) estimates an expected decline of between 20-30 percent in international visitors.

Visit the Coronavirus Updates page on the KATA website on https://katakenya.org/corona-virus-updates/ for more information

 

Competition among airlines has now shifted to the cargo business which many have taken up following cessation of passenger flights across the globe.

Airlines are converting their passenger planes into cargo carriers to keep aircraft running and earn some revenue.

Kenya Airways which has joined the fray could be forced to re-adjust its freight charges to survive the high competition in the cargo business.

The carrier is currently charging $3 (about Sh321) per kilo of cargo, according to fresh produce exporters, which is high compared to some competitors such as Ethiopian Airmeeting, lines and Qatar Airways who are charging $2 (about Sh214).

“KQ is expensive compared to competitors,” notes Edward Mureu, the proprietor of Naivasha based Rubi ranch.

According to the East African Business Council (EABC) airfreight charges to the European Union and other markets in the last few weeks have ranged from $3 and $7(Sh749) per kilo up from an average of $1.50(Sh160)–$2.50(Sh267) per kg.

“The high air freight charges can be attributed to a combination of factors. These include higher operating costs, fewer scheduled or chartered flights, and a supply and demand imbalance,” EABC chief executive Peter Mathuki said.

In Kenya, for example, the volume of fresh produce out of Jomo Kenyatta International Airport (JKIA) has reduced from a weekly 5,000 tonnes to 1,300, a 75 per cent decline with similar trends reported across the region. This has left few volumes up for grabs by carriers. Costs, however, continue to ease with more scheduled capacity provided by KLM, Qatar and Ethiopian Airlines.

KQ, as it is known by its international code, has converted four of its passenger aircraft into cargo carriers, a measure to lessen the impact of Covid-19, which has seen a cut on international travel, with the airline grounding its fleet.

Last Thursday, the airline flew a Boeing 787 Dreamliner to London with 40 tonnes of fresh produce consisting of vegetables and flowers.

It has been depending on two-boeing 737-300 cargo aircrafts for haulage.

“We are exploring different options to keep the lights on in the organization. Cargo is one of those areas,” CEO Allan Kilavuka said.

This week, Air France KLM Martinair Cargo launched two cargo flights a week between Nairobi and Amsterdam. The Tuesday and Sunday flights will see the carrier export 45–50 tonnes of cargo from Kenya.

This is in adition to existing full freighter flights Air France KLM Martinair is regularly operating.

The move adds pressure on airlines at JKIA– KQ’S hub, which accommodates over 40 passenger airlines and 25 cargo airlines.

Other cargo operators include Lufthansa Cargo, emirate Sky cargo, cargo lux, Ethiopian airlines, Saudia Airlines, Etihad Crystal Cargo and Egypt Air. Others are Singapore Airlines, Qatar Airlines, Turkish Cargo, mk Airline and Swiss World cargo.

Source: https://www.pressreader.com/kenya/the-star-kenya/20200423/281771336334747