Everywhere around the world, reports indicate, the cost of flying cargo continues to rise and negatively impact on an industry that is yet to fully recover from Covid-19 pandemic.

The Africa Airlines Association (AFRAA), a trade association of airlines on the continent, indicates that expensive jet fuel, or aviation turbine fuel, and other expenses are weighing down on profits.

According to AFRAA, full-year revenue loss for African airlines for 2022 is estimated at $4.1 billion, equivalent to 23.4 percent of the 2019 revenues.

To stay in business, reports indicate, airlines adjusted their fares upward because of a sharp rise in the cost of jet fuel. The cost of jet fuel, it is reported, has increased 36 percent in the last six months, prompting airlines to add a special levy to protect their margins.

John Bosco Kalisa, the CEO of the East African Business Council (EABC), stressed that “this is terrible” as it will increase the cost of doing business in the region.

“Already the airlines are struggling to recover from devastating impact of Covid-19. Any additional charges will derail the recovery of both the cargo and passenger flights,” he told Doing Business.

The cost of jet fuel – which accounts for a significant portion of expenses involved in running an aircraft – hit a high of $1.25 a litre from $0.85 in January, piling pressure on airlines at a time when the demand for flying remained low as the industry still recovered from effects of Covid-19.

In Rwanda, high freight rates are already casting a shadow over, among others, Rwanda’s horticulture export prospects.

According to Robert Rukundo, chairperson of the Horticulture Exporters Association of Rwanda (HEAR), prices of airline charges increased from Rwf1.8 million to Rwf2.2 million, the latest being Rwf2.5 million because of the rise in fuel costs and taxes. As noted, the cost is $2.67 per kilo in terms of gross weight.

Horticulture exporters especially worried that national carrier RwandAir planned to increase the airfreight fee on a kilogramme of fresh produce from $1.8 to $2, effective August 1.

“Freight charges have gone up because jet fuel prices have doubled in the last few months. All airlines have increased the rates,” Yvonne Makolo, Chief Executive Officer of RwandAir, told Doing Business on Monday, August 1.

Asked what they are advocating for, Theoneste Ntagengerwa, the Private Sector Federation (PSF) Spokesperson, told Doing Business that: “The solution on our side should focus on finding a Rwandan owned cargo airplane, which can allow us to export big quantities but also lowering the cost for export.”

“The second aspect to consider should also be proper policies that support increase of our export to avoid the cargo [plane] being underutilized.”

But Makolo noted that even when RwandAir eventually secures a cargo plane, high freight charges could stay.

She said: “The freighter is in the process of being acquired but that’s not the answer. It will provide additional capacity but unless fuel prices come down, the rates will still be high.”

Besides the pandemic, the war in Ukraine also affected earnings by airlines that had to endure rising costs of jet fuel.

Source: The New Times

Airports need to address their unpopularity as a workplace if they’re to resolve a labor crunch that’s spawned a summer of travel chaos, the world’s biggest ground-handling firm said.

While pay hikes may narrow the staffing gap, they won’t resolve deep-seated issues in attracting new recruits, Tarek Sultan, vice chairman of Agility Public Warehousing Co., said Friday after the Gulf firm completed the purchase of John Menzies Plc, which provides handling at hubs including London Heathrow.

“It’s really hard to hire people in this day and age after Covid and we’re really trying to figure out why,” Sultan said on Bloomberg Television. “Nobody has a 100% clear answer. We have to be competitive with our wages, but we also have to look at other ways to improve retention and make this industry a more attractive place to work.”

Heathrow last week blamed airlines and their ground handlers for the turmoil that’s been afflicting European travel for months as demand rebounds from the pandemic. Chief Executive Officer John Holland-Kaye said they’ve been too slow to recruit and that handlers including Menzies are in some cases not paying enough to compete with firms like Amazon.com Inc. as they seek staff.

Sultan said that while Kuwait-based Agility understands that it must invest to beef up the workforce, costs would need to be passed on and the airline industry right now is “not the ideal place to be looking to increase prices to customers.” Expenses would have to be offset “in a very measured way.”

He said the travel situation should improve over the next couple of quarters, and that in future the aviation industry as a whole needs to do better in anticipating demand and coordinating step changes in operations.

Edinburgh-based Menzies said Friday that its London Stock Exchange listing was canceled as of 7 a.m. after Agility completed the 571 million-pound ($694 million) takeover.

Agility’s National Aviation Services will take on the name and identity of the Scottish firm, which traces its origins back almost 190 years and provides ground handling, aircraft fueling and cargo services at more than 200 locations in about 40 countries.

NAS operates at about 55 airports across the Middle East, Africa and South Asia.

Source: Bloomberg

Lufthansa Cargo and Cathay Pacific have expanded their cargo partnership to include Swiss WorldCargo, which they say will provide customers with more choice.  

The freight arm of Germany’s Lufthansa Group and the Hong Kong-based airline first set up their cargo joint business agreement in 2016, allowing them to coordinate sales, pricing, contracts, and the handling of shipments between Hong Kong and Europe.  

Adding Swiss WorldCargo to the agreement will see the airlines initially cooperate on traffic from Hong Kong to Zurich and Frankfurt. Traffic to and from Hong Kong and the rest of Europe will be included in the expansion with Swiss WorldCargo later this year, the carriers said.  

The expanded partnership comes amidst a busy time for the air freight industry, with supply chain problems resulting from COVID-19 restrictions having boosted the importance of air freight as a method of transporting goods. Lufthansa Cargo has posted record financial results and says an end to the air cargo boom is not in sight.  

Swiss World Cargo is the air freight arm of Swiss International Air Lines, itself a part of the Lufthansa Group.  

“The addition of Swiss WorldCargo’s flights to the already large combined network of Cathay Pacific and Lufthansa (LHAB) (LHA) will further bring Hong Kong, the world’s busiest air cargo hub, closer to Europe and strengthen one of the world’s great trade lanes,” commented Cathay Pacific Director Cargo Tom Owen in a statement on May 31, 2022.  

Lufthansa Cargo CEO Dorothea von Boxberg said cargo customers should gain quicker and easier shipping. “The expanded joint venture will generate numerous benefits for our customers because our networks, our hubs and our fleet complement each other effectively.” 

The carriers said the joint activities will be carried out in compliance with all relevant laws, including those in Hong Kong and the European Union. 

Source: Aerotime Hub

Delays in completion of international departure terminals at the Jomo Kenyatta International Airport (JKIA) are taking a toll on airlines due to occasional congestions at the facility, which has seen passengers miss connecting flights.

Kenya Airports Authority (KAA) started refurbishment of terminals 1B and C at the JKIA in January last year with the agency giving a commitment of completing the exercise in 12 months’ time.

Kenya Airways is one of the airlines that has raised concern over the delays occasioned by the long closure of these terminals, saying it has inconvenienced its departure time at the facility due to the slow processing of passengers.

“The delayed completion of terminals 1B and C is causing a lot of congestion at terminal 1A and long queues during peak time,” said Allan Kilavuka, the chief executive of KQ as the national carrier is known by its international code.

The delays have seen a number of passengers with connecting flights in other airports miss their trips as they arrive late at their next point of departure.

Currently, departing international passengers who would previously use the affected terminals go to Terminal A, creating congestion at the facility given the high number of airlines that have now been combined at the gate.

KAA managing director Alex Gitari did not respond to the Business Daily enquiries by the time of going to press.

KAA said last week that the number of passengers using the facility had grown significantly as the aviation sector returns to normalcy after the disruption caused by the Covid-19 menace in 2020.

An increase in traffic at the airport means that it is taking longer to process passengers before they get to board.

JKIA remains a major regional hub where transit passengers use the facility to connect flights to either US, Britain, or the Middle East.

The Sh936 million renovation programme by KAA on these terminals is meant to enhance security screening at the facility.

The refurbishment of the departure halls at the two terminals is also aimed at improving the check-in activity and enhancing the passenger lounge experience for the customers using the airport.

Its completion will also ease passenger flow and increase efficiency due to the centralisation of security screening procedures and the reallocation of available floor spaces to international departure gates.

KAA has in recent years cancelled a number of projects including the construction of a second runway and the Green Field terminal.

JKIA, Kenya’s main airport, is a major hub for passengers connecting to Europe and America among other destinations.

Kenya’s delay with the expansion of JKIA comes at a time when regional countries are revamping their airport infrastructure as they position themselves to attract global airlines.

Expansion of Tanzania’s main airport is currently on course, a project likely to reduce Dar es Salaam’s reliance on Nairobi for transit flights by some of the European airlines.

Kigali in Rwanda and Bole Airport in Addis Ababa have also been undergoing a facelift as they seek to become a major regional hub.

Source: Business Daily

As SAA and Kenya Airways make plans for a new pan-African airline, AviaDev Africa plays host to the discussions of opportunity and inspiration.

One of the biggest stories of African aviation this year is the tie-up between leading international carrier Kenya Airways and the rebirthed flagship airline South African Airways. Signed in November, the Strategic Partnership Framework anticipates improving profitability and bolstering financial strength for both airlines.

While details on the exact shape and size of this partnership remain to be seen, the venture is intended to provide strength in scale. Both carriers have lost traffic to African juggernaut Ethiopian Airlines, with Kenya posting a loss of $130.5 million in 2021. The story of SAA is well known, but with private investors now holding a majority stake, there is much hope for a better future.

Since the partnership agreement was firmed up, the two airlines have struck out in search of investors to support the new venture. They have also launched a headhunt for more airlines to join the cause, specifically seeking a third partner in the West Africa region, most likely from Nigeria, Ivory Coast, Ghana or Senegal.

This new airline group intends to unveil itself in 2023. But what will it look like, what will it be called, and will it work? Speaking at today’s AviaDev Africa conference, Simon Newton-Smith, Chief Operating Office for South African Airways, shed some more light on the plans for this new pan-African airline, and might have just found himself a new airline partner.

The Lufthansa model is applicable for Africa

Simon, although new to South African Airways, is an old hand in the aviation world. Among his previous appointments, he was a Vice President at Virgin Atlantic for a decade and a half, during which time the airline launched its joint venture with Delta. Harking back to those days, he provided us with some color on what we can expect from the new KQ/SAA venture.

“This is a model that exists around the world. And the most successful models that I’ve seen leverage the local brands, and the distribution of those brands in the home markets. I was fortunate enough to work within the Virgin Atlantic/Delta Air Lines joint venture, Virgin didn’t become Delta and Delta didn’t become Virgin. They both got unique strengths, and the goal is to leverage that.”

With this in mind, Simon anticipates both SAA and Kenya Airways retaining their own branding, Both have strong images and customers who are emotionally attached to those brands, so why would they want to change that? Any other airlines joining the venture would also retain their own identity. This is something that has not been tried in Africa in quite such a way in the past, but something we’re pretty familiar with in Europe.

“If you look at what the Lufthansa Group has achieved in Europe – these are airlines that, 20 years ago, figured out that they had to come together to be effective and efficient. They’ve done that really well. The Lufthansa Group is collective of multiple European brands, and there is absolutely a foundation for that model in Africa.”

The other thing Lufthansa does well is its segmentation, catering to all traveler markets. While SWISS, Brussels, Austrian and Lufthansa offer full-service options and business travel perks, Eurowings is one of the few low-cost offshoots from a full-service airline that has actually been a success. And now, long-haul low-cost is being tackled through the new Eurowings Discover brand.

How can this be replicated in Africa? Kenya Airways and SAA are both full-service airlines, offering valuable connectivity in long-haul leisure and business markets. But when it comes to that shorter haul, lower-cost travel, there’s a gap to be filled.

Is Air Botswana Africa’s answer to Eurowings?

Also, on the panel at AviaDev Africa was Getaneh WoldeMichael, Commercial Director of Air Botswana, who noted,

“Air Botswana is an airline that has been here for over 33 years. It has remained with the route network it is serving today, more or less, for all of those years.”

An airline that is not growing is not in a strong position, and WoldeMichael firmly believes that the route network should be grown. But justifying the need to go to further away destinations and launch new routes can be difficult.

Air Botswana has struggled to get into the black, running at a loss for more than a decade. It is 100% government-owned, despite efforts to privatize it several times in the past. It is around a year into a three-year strategic recovery plan, and privatization is on the table once more. But something else is on the table too, and that’s deeper partnership working, as WoldeMichael noted,

“Alliance partnerships are required to fill that gap [in the route network]. As you all know, Lufthansa came up with a new arm called Eurowings, which targets tourist destinations. There is no answer from Africa for that – Air Botswana would be very happy to be part of such a response.”

Before the panel closed, Simon Newtown-Smith beautifully illustrated the situation facing African airlines,

“Frankly, a lot of loss-making Airlines on this continent need to come together in some shape or form to have a sensible conversation with institutional investors … you can have a very different conversation with a good plan about connecting a continent that has got a runway of 10, 20, 30 years … that is the conversation need to have not a conversation about two aeroplanes for next year. That’s not going to work.”

Turning to WoldeMichael, Newton-Smith added, “We need to start talking soon.” Could Air Botswana become the next addition to the KQ/SAA pan-African alliance? While that remains to be seen, right there is a demonstration of the power of getting back together in person and the positive outcomes it can bring.

Source: Simple Flying

The Airports Council International (ACI) says global passenger traffic in 2022 will be significantly higher than during the previous two years due to the relaxation of travel restrictions and returning confidence in air travel. 

Global passenger traffic is expected to reach 77% of COVID-19 pandemic levels, with 7.1 billion passengers travelling through airports in 2022. The positive trends in 2022 will be driven by global domestic passenger traffic.  

However, ACI warned that much uncertainty still surrounds the air travel recovery, “especially in the medium to long term” due to geopolitical conflicts, higher inflation, the risk of economic downturn, supply chain bottlenecks, labor shortages and potential new outbreaks.  

According to the organization, global domestic passenger traffic is forecasted to reach pre-pandemic levels in late 2023, while global international passenger traffic is expected to reach pre-COVID levels in the second half of 2024. This is hampered by a sluggish recovery in Asia-Pacific and a slower recovery in global international travel. 

“With the combination of ‘vacation deprivation’ and an upsurge in confidence in air travel provided by increased vaccination rates and safety measures, the relaxation of travel restrictions will help boost the propensity for air travel and fuel the industry’s recovery,” ACI World Director General Luis Felipe de Oliveira said. 

“With many countries taking steps towards the return to a certain normality, lifting almost all the health measures and travel restrictions, we expect a jump in air travel demand in the second half of 2022,” de Oliveira added. 

Source:  Aerotime Hub

Book a flight and you’ll usually get the option to pay to offset your carbon emissions. In essence, your contribution funds tree planting and other projects intended to counterbalance the carbon you emit.

It’s a clever marketing ploy. But carbon offsets are a dangerous distraction from the need to reduce emissions.

While global aviation emissions almost halved during the pandemic, they are predicted to reach pre-pandemic levels by the end of this year. In fact, they’re on track to rise a further 25 per cent by 2030 – with disastrous consequences for nature and climate vulnerable communities.

Carbon offset schemes perpetuate the idea that the climate crisis shouldn’t stop aviation from increasing. They assuage climate guilt, while passing the problem onto someone else.

Experts also agree they don’t work. In 2017, a European Commission report found that 85 per cent of offset schemes established under the Kyoto Protocol Clean Development Mechanism failed to reduce emissions. And last year, the EU stopped counting offset schemes in emissions reductions targets.

There are better ways to cut your holiday emissions. So, what should travellers do instead?

Fly less and stay longer

Limiting the number of flights, you take is the simplest and most effective way to reduce your holiday carbon.

Data from the International Civil Aviation Organisation (ICAO) calculates that a return economy flight from London to New York emits an estimated 0.62 tonnes of CO2 per passenger. That’s 11 per cent per of the average Briton’s annual carbon footprint, and equivalent to the average Ghanaian’s total emissions a year. The more you fly, the heavier your footprint will weigh.

So, fly less, and instead stay longer. You’ll enjoy a more relaxing holiday and an opportunity to explore your destination in more depth too.

Swap planes for trains

Making the journey part of your holiday is a feasible option across much of Europe. Good connections link a multitude of popular holiday destinations. Taking the train from London to Madrid, for example, emits an estimated 174 per cent less CO2 than flying according to the Ecopassenger calculator.

Responsible Travel now offers over 160 flight-free holidays to Europe, while other tour operators such as Byway Travel, Exodus, and Cycling For Softies offer train travel as part of their tour packages too. Alternatively, The Man in Seat 61 is an excellent resource for independent travellers wanting to travel by train.

If an international flight is unavoidable, cut out other domestic flights if you can and explore your destination at a slower pace overland.

Explore destinations actively, or with emissions-free transport

Human powered exploration is not only emission-free but often wonderfully unexpected and eventful. Walking, cycling, or kayaking gives a more intimate perspective to your holiday and can lead to memorable chance encounters with local people. Electric bikes can take the strain when lungs or legs can’t.

On the electric front, some safari lodges in places like Kruger National Park, South Africa or Ol Pejeta Reserve, Kenya, now have lower-emission electric safari vehicles available. These have the added benefit of being quieter and less disturbing for wildlife.

Watch your ‘foodprint’ on holiday

With 37 per cent of global greenhouse gases coming from food production, what you eat on holiday can significantly impact your total carbon footprint too.

Choosing to eat local limits how far your food travels before it hits your plate. Farmers markets and restaurants serving fresh, locally sourced produce are a good place to start. As a bonus, this usually gives you the chance to try local delicacies and discover the dishes that make your destination sing.

If you want to go one step further, a plant-based diet can reduce your personal footprint by up to 73 per cent.

New alternatives to carbon offsets

Major airlines including British Airways, Lufthansa and KLM have recently launched schemes which allow passengers to fund the use of sustainable aviation fuel (SAF). Mixed in a 50 per cent ratio with standard aviation fuel, SAFs have the potential to lower flight emissions by up to 80 per cent.

However, their long-term effectiveness in decarbonising travel is still unknown and these schemes are still voluntary and expensive. What impact they will have remains to be seen.

When you do fly, make it count

The pandemic has thrown into sharp relief what can happen when tourism stops.

According to non-profit Conservation International, COVID lockdowns drove an increase in illegal mining and deforestation in Colombia and Brazil. In Africa, the charity says, the collapse of the tourism industry has driven an “alarming increase” in poaching and wildlife trafficking.

The World Travel and Tourism Council estimates that tourism accounts for 319 million jobs globally. As well as protecting forests from more extractive industries, it funds crucial anti-poaching patrols, and has helped establish marine and terrestrial reserves that preserve global biodiversity.

Saving the planet will need both reductions in carbon emissions, plus extensive rewilding. If you do choose to fly, look for nature-positive holidays which actively benefit wildlife and habitats, and pick trips that ensure the money you spend ends up in local hands.

Carbon offsets aren’t even a sticking-plaster solution to our climate crisis.

Want to be a greener traveller? The truth is you’ll need to fly less and do more in your destination to reduce your carbon footprint. And when you do fly, make it count. You might find it makes for a more memorable holiday for you too.

Source: Euronews

Impact from the conflict in Ukraine on air travel has been limited, according to the International Air Transport Association (IATA).

It further said effects of the Corona virus Omicron variant continued to be largely confined to Asian domestic markets.

The latest IATA industry report shows total traffic in March as measured in revenue passenger kilometers was up 76 per cent compared to March last year.

Although that was lower than the 115.9 per cent rise in February year-over-year demand, volumes in March were the closest to 2019 pre-pandemic levels, at 41 per cent below.

Domestic traffic was up 11.7 per cent compared to the year-ago, far below the 60.7 per cent year-over-year improvement recorded in February.

This largely was a result of the Omicron-related lock downs in China. March domestic revenue per customer was down 23.2 per cent versus March 2019.

International revenue per passenger rose 285.3 per cent compared to same period last year, exceeding the 259.2 per cent gain experienced in February versus the year-earlier period.

Most regions boosted their performance compared to the prior month, led by carriers in Europe.

“With barriers to travel coming down in most places, we are seeing the long-expected surge in pent-up demand finally being realised,” IATA’s director general Willie Walsh said.

He added that unfortunately, there are long delays at many airports with insufficient resources to handle the growing numbers.

”This must be addressed urgently to avoid frustrating consumer enthusiasm for air travel,” he said. 

African airlines had a 91.8 per cent rise in March compared to a year ago, improved compared to the 70.8 per cent year-over-year increase recorded in February.

 Air travel demand is challenged by low vaccination rates on the continent as well as impacts from rising inflation.

Capacity in March was up 49.9 per cent and load factor climbed 14.1 percentage points to 64.5 per cent.

European carriers continued to lead the recovery, with March traffic rising 425.4 per cent compared to same period last year. It improved 384.6 per cent the previous month.

 The impact of the war in Ukraine has been relatively limited outside of traffic to and from Russia and countries neighbouring the conflict.

Capacity rose 224.5 per cent, and load factor climbed 27.8 percentage points to 72.7 per cent.

Europe was followed by Middle Eastern airlines’ whose traffic rose 245.8 per cent during the month under review compared to similar period last year.

March capacity rose 96.6 per cent versus the year-ago period, and load factor climbed 31.1 percentage points to 72.1 per cent.

Latin American airlines ‘March traffic rose 239.9 per cent compared to the same month last year, a little change from the 241.9 per cent increase in February.

 The region benefited from the end of bankruptcy procedures for some of the main carriers based there.

March capacity rose 173.2 per cent and load factor increased 15.8 percentage points to 80.3 per cent, which was the highest load factor among the regions for the 18th consecutive month.

North American carriers experienced a 227.8 per cent traffic rise in March, slightly down on the 237.3 per cent rise in February.

Capacity rose 91.9 per cent, and load factor climbed 31.2 percentage points to 75.4 per cent.

Source: The Star

Kenya Civil Aviation Authority (KCAA) director-general Emile Arao has assumed office after a court dismissed a petition that an NGO had filed to stop his appointment last week.

Mr Arao — a US-trained aircraft engineer, aviation veteran and businessman — has finally replaced Gilbert Kibe who left the agency last month after completing his term.

The KCAA board had appointed Nicholas Bodo, a Ministry of Transport executive, as the acting director-general of the State corporation while the dispute over Mr Arao’s appointment was before the court.

The High Court declined to stop the appointment of Mr Arao, saying the petition Kazi Mtaani na Shadrack Wambui, the NGO, filed was not compelling enough.

“He has finally taken office from Mr Kibe. A petition that was filed to block his appointment has been dismissed by the Employment and Labour Relations Court,” a source at the KCAA told the Business Daily on Monday.

The petitioner moved to court to block Transport Cabinet secretary James Macharia’s appointment in March.

The NGO claimed that a report by the Arusha-based East Africa Legislative Assembly (EALA) had indicted Mr Arao of poor management and possible embezzlement of funds at the East African Civil Aviation Safety and Security Oversight Agency (EAC-Cassoa).

Employment and Labour Relations Court judge David Nderitu, however, ruled that there was no evidence of these allegations of mismanagement at his previous workstation.

The judge said he was not satisfied the petitioner had demonstrated an arguable case with a likelihood of success, arguing that the court is not an investigating body.

“In view of all that is stated above, the conservatory orders sought by the petitioner in the notice of motion dated March 14, 2022, are hereby denied,’’ said the judge in a ruling delivered on May 10.

Mr Arao has been battling allegations of incompetence and misuse of finances at Cassoa after the East African Legislative Assembly, in an audit report, fingered him over poor management of finances and recommended he be held accountable.

He, however, countered that if there was wastage or theft of funds, the audited financial statement and management letter would have led to a qualification of the accounts, which did not happen.

Source: Business Daily

The aviation industry could return to pre-pandemic passenger traffic levels sooner than expected, according to the director general of the International Air Transport Association.  

Willie Walsh told Reuters that the industry could reach 2019 traffic levels in 2023, a year earlier than previously forecast. The war in Ukraine, ongoing restrictions in China, high oil prices, and travel delays from staff shortages are not denting the recovery so far, he said.   

“I don’t think we should be distracted from the fact we are seeing a strong recovery and I think that recovery will gather momentum as we go through the rest of this year into 2023,” Reuters quoted Walsh as saying in an interview on May 9, 2022. 

“We’re seeing very strong bookings,” Walsh added. “Certainly all the airline CEOs I’m talking to are seeing not just good demand for year-end travel but they continue to see demand as they looked through the year.” 

IATA data for March 2022 showed strong growth in passenger traffic compared to 2021, with Europe leading the recovery.  

In March 2022, traffic measured in revenue passenger kilometers rose 76% compared to March 2021. That’s still a drop of 41.3% compared with March 2019 levels, but an improvement on the 45.5% drop seen in February.  

“With barriers to travel coming down in most places, we are seeing the long-expected surge in pent-up demand finally being realized,” Walsh commented in the traffic data release on May 4, 2022.   

However, Walsh also cautioned about a lack of resources to handle the return of demand.  “Many people have waited two years for a summer holiday – it should not be ruined through lack of preparation.” 

Source: Aerotime Hub