The Kenyan government is developing a financing strategy for Kenya Airways (KQ, Nairobi Jomo Kenyatta) that will end its reliance on state support by the end of December 2023, according to a brief note in its draft 2023 Budget Policy Statement.

“To support the aviation industry, the government will develop a turnaround strategy for Kenya Airways. A critical plank of this strategy will be a financing plan that does not depend on operational support from the exchequer beyond December 2023,” the statement reads.

Meanwhile, the technically insolvent flag carrier will receive state support of KES34.9 billion shillings (USD283.2 million) this year after the government earlier pledged continued financial aid in FY2022/23 to prevent defaults for the settlement of lessors’ arrears and working capital support. Since June 2022, Kenya Airways has been undergoing restructuring – financed with state loans that will have to be repaid – focusing on fleet and network simplification, staff rationalisation, cost management, labour agreement overhauls, ancillary business and strategic partnerships.

In May 2022, the government approved a state loan of KES20 billion shilling (USD173.9 million), and the airline borrowed another KES11.3 billion (about USD95 million) in the half-year ending June 30, 2022. This followed loans of KES11 billion (USD95.2 million) in 2020 and KES14 billion (USD121.1 million) in 2021.

The Kenyan government, in the meantime, is looking for a cash-rich foreign airline to take Kenya Airways off its hands. President William Ruto reportedly pitched a plan to Delta Air Lines (DL, Atlanta Hartsfield Jackson) during a visit to the United States recently.

Source: Ch-aviation

Rekindled optimism of the Federal Government to float a new national carrier in the twilight of this administration berates sincerity and real national interest. Characteristically, this administration promised more for aviation development than it has delivered and the telltale signs are all over the industry. But a horridly packaged new national carrier will not assuage inherent poor leadership in the air transport sector nor cover up for policy missteps. In place of another albatross, the Ministry of Aviation should stay focused on realistic developmental policies. 

The project handlers recently came up with the nomination of Ethiopian Airlines owning a major share of the national carrier and much to the displeasure of some stakeholders, including local airline operators that have protested and taken the matter to court. It will be recalled that the new national carrier, already christened Nigeria Air, is one of the electoral campaign promises of Muhammadu Buhari just before 2015.

Added to that was the 2016 pledge by Hadi Sirika, the Aviation Minister, to concession all the airports for efficiency, set up a Maintenance Repair and Overhaul (MRO) facility, attract aircraft leasing companies to Nigeria and build aerotropolis at major airports nationwide. All of those promises only exist in Sirika’s playbook till date.

But a national carrier would always be a sentimental subject, especially for those that saw the defunct Nigeria Airways in its heydays. Airliners, branded in national colours, are always elegant assets and national pride globally. They are synonymous to having embassies in motion, showcasing the splendor and economic powers of a country in diplomatic space.

With over 100 Bilateral Air Service Agreements (BASAs) already racked up by Nigeria, it means 100 potential markets for a new national carrier to operate commercially and unhindered by the aeropolitics that often clip the wings of designated flag carriers.

As patronising as the venture sounds, the logic is flawed. Airline business is high-capital intensive and too expensive a bill for national pride alone. A new aircraft costs an average of $80 million and the industry, in good times, has a profit margin of about five per cent return on investment. That explains why economic superpowers like the U.S., UK, France, among others, have over the years shared the burden of ownership with the private sector.

Even the most successful airline in Africa – Ethiopian Airlines – once hinted of plans to divest both assets and liability to enhance chances of survival. Apparently with that in mind, the Outline Business Case of the proposed Nigeria Air has a joint partnership between the state and private sector, with the latter expected to bear as much as 95 per cent of ownership.

But the project has been a hard sell for Sirika and his team of consultants who have been unable to convince stakeholders and investors alike. It is on record that only Ethiopian Airline (ET) expressed interest in the Nigeria Air project globally when Nigeria called for bidders, taking advertorial pages in international newspapers.

Perhaps their first error was to unilaterally conceive and christen the new airline in London, far away from the glare of Nigerians that only welcome it with vitriolic criticism. It couldn’t fly until COVID-19 caught up with it and it has since remained a hard nut to crack, failing to take-off in five attempts.

If it was difficult convincing credible investors before COVID-19, it must be more difficult now in a world ravaged by economic downturns of Russia and Ukrainian war. The timing is also wrong for the Nigerian economy that is in recession and borrowing to augment one-third of its 2022 budget amid an almost100 per cent debt-to-revenue ratio.

The national carrier has also proven its capacity for prodigality. In the last five years, the project has racked up an estimated N15.9 billion in budgetary votes, though Sirika has lately countered that only N352 million was approved and another N299 million for Transaction Advisers and Consultants.

It is a shame that the incubation phase of the national carrier has taken forever where the likes of Ibom Air, owned by Akwa Ibom State government, started small in about a year of conception and earned a major stake in Nigerian domestic airspace.

How come the likes of Boeing and Airbus plane manufacturers are not showing interest or signing deals to avail brand new aircraft to launch the new carrier like Boeing has done in Ghana? Why are the local stakeholders that earlier warmed up to the project turning their backs on it, describing it as “Sirika’s project” and a giveaway to ET that is already an operator and fellow competition on the continental space? The minister should be answerable and made accountable for every penny spent on the project to date.

Tellingly, the minister has failed in his remit. Though he came in as an aviator and has been the longest serving helmsman, his deliverable has been less than convincing. As an aviator that understands the prevailing operating environment, he knows that there are too many booby-traps in the local environment that hobble the growth of all operating carriers, including the proposed national carrier.

There are perennial problems of decrepit airport infrastructure, low capacity and aircraft underutilisation, multiple taxation, multiple destinations for foreign carriers, foreign exchange scarcity to fund aircraft maintenance and buy spares, scarcity and hike in the cost of aviation fuel. As a ministry in particular and government in general, what solutions or policies have been proffered to ameliorate these problems to save the sector from imminent collapse?

The foreign airlines are exploiting Nigerian air travellers through hike in airfares and the stuck fund window; does that bother local authorities? It is not enough for a government to blame unanticipated challenges for its woes. The actual business of governance and leadership is to solve those problems and not give excuses that are typical of charlatans.
  
Surely, the local operating environment is not homely for a new national carrier notwithstanding its benefits. And to save our cash-strapped country from another round of wastages, more legal fireworks and heartaches in the post-Buhari era, it is safe to ditch the national carrier plan for now.

Rather, Sirika, the ministry of aviation and relevant stakeholders should pay closer attention to policy formulation for the development of the sector and the economy at large. Successful aviation sectors, in other parts of the world, are designed to complement other sectors like tourism, logistic services, agriculture, mining and so on. Aviation in Nigeria needs such a robust template and problem-solving leadership to turn the corner and have an enviable sector for all to thrive. A new national carrier, no matter how well-intentioned, will not fill that void.

Source: The Guardian

Ethiopian Airlines will next month lift capacity on its China flights and restore frequencies to pre-pandemic levels from the start of March following the recent easing of Covid travel restrictions in the Asian country.

The African carrier will be one of the first international operators to restore pre-Covid capacity levels to China since restrictions, including the requirement for visitors to quarantine, were eased earlier this month.

China was a key market for Ethiopian prior to the pandemic with the carrier serving Beijing, Chengdu, Guangzhou and Shanghai. Cirium schedules data shows it has been serving all four cities since November, albeit at much lower frequencies.

It will now from 6 February lift to daily its service to Guangzhou, before restoring frequency to 10 flights a week from the start of March. Ethiopian will lift frequency on its Beijing and Shanghai service to four flights a week next month and restore daily links from 1 March. It will also add back a fourth weekly flights to Chengdu, restoring to 28 its weekly China services.

Ethiopian Airlines chief executive Mesfin Tasew says: ”China is one of the largest markets for Ethiopian Airlines outside Africa, and the increase in flight frequencies will help revive the trade, investment, cultural and bilateral cooperation between Africa and China in the post-Covid era.”

He adds: “We are keen to further expand our service to China going forward.”

Ethiopian also operates cargo flights to Guangzhou, Changsha, Shanghai, Zhengzhou and Wuhan.

International carriers, particularly in Europe and North America, are largely yet to commit to restoring China capacity  despite the easing in travel rules. Though China lifted the most onerous of Covid travel restrictions, PCR testing remains in place – while many countries have reimposed a testing requirement of their own on Chinese arrivals amid the surge in Covid cases which has followed China’s dropping of its zero-Covid policy.

Source: Flight Global

United Arab Emirates carrier Emirates in October suspended flights to Nigeria over inability to access foreign exchange, bringing to a climax the lingering crisis between UAE and the most populous African country.

All other foreign airlines still operation in Nigeria are suffering a similar fate.

After many previous suspensions of operations since 2021, Emirates finally saw the foreign exchange crisis facing Nigeria as the main reason for its inability to continue with the flights.

The airline explained that its operations were hampered by the inability to access and repatriate its $85 million from Nigeria. 

This started in 2021 when the UAE mega carrier sought to monopolise the Nigeria-UAE route in flagrant disregard to a bilateral aviation safety agreement with Nigerian carrier, Air Peace.  

Emirates operated twice daily to Lagos and once daily to Abuja, recording 21 frequencies weekly but UAE restricted Nigeria’s Air Peace to only one flight weekly to Abu Dhabi instead of Dubai.

Diplomatic crisis

In a tit-for-tat, Nigeria’s federal government in December 2021 reduced Emirates’ weekly frequencies from 20 to only one flight to Abuja.

The action forced Emirates to suspend flights to Nigeria but it resumed after the diplomatic crisis was amicably settled when Dubai Civil Aviation Authorities Airport allowed Air Peace to make seven weekly flight to Dubai.

A letter by Dubai Civil Aviation Authority dated December 13, 2021 addressed to Air Peace said that in order to maintain good relations between the two countries, it had offered to block some slots for the Nigerian carrier.

Besides the flight slots crisis, UAE recently stopped visas to younger Nigerians except for those traveling on family visa, thus affecting the operations of airlines flying the Nigeria-UAE route.

Air Peace also suspended flights to Dubai from November 22, 2022 over the non-issuance of visas to Nigerians, it said in a statement.

The global downturn effecting Nigeria’s ability to sustain its foreign reserves build-up has caused another tiff with foreign airlines, forcing Emirates to abandon flights, the sixth time since July 2021.

No option

A statement by Emirates said it had no option but to suspend flights to and from Nigeria from October 29, 2022 to mitigate against further losses and to recover its $85 million trapped fund.

“Without the timely repatriation of the funds and a mechanism in place to ensure that future repatriation of Emirates’ funds do not accumulate in any way, the backlog will continue to grow and we simply cannot meet our operational costs nor maintain the commercial viability of our operations in Nigeria.”

Emirates demanded that Nigeria provides a “guaranteed mechanism to avoid future repatriation accumulation challenges and delays”.

The UAE airline had earlier reinstated flights on September 11, 2022 after the Central Bank of Nigeria (CBN) released $265 million out of the $700 million due to foreign airlines to settle outstanding trapped funds from ticket sales.

“Emirates welcomes the CBN move to release a portion of our blocked funds,” said the airline’s Public Relations Manager Rula Tadros in a statement.

Resumed flights suspension

However, the airline resumed the suspension of flights in October to force the CBN to release the last tranche of the funds to foreign airlines.

The suspension has impacted on the thousands of passengers who fly Emirates.

With an average of 350 passengers per flight, Emirates transports 15,120 travellers from and into Lagos and Abuja every week.

But these passengers have alternatives.

The travellers to Dubai are currently using other foreign airlines including Egypt Air, Air France, KLM, Ethiopian Airlines, Rwanda Air and Etihad.

“Why should the airline shut its services while others from the same region are operating?’’ wondered Mr Adams Abdullahi, a travel agent who is unhappy with the decision by Emirates.

“I think there is still a big diplomatic row which the airline is not telling Nigerians.”

Foreign exchange crisis

The lingering foreign exchange crisis has impacted negatively on the domestic and international airlines over the past few months.

The International Air Transport Association (IATA) says international airlines have been unable to repatriate funds since July 2022.

Stakeholders are not happy with the situation in the aviation industry, advising the Nigerian central bank to allow foreign airlines access their funds.

Mr Olumide Ohunayo, the head of research and corporate travel at Zenith Travels and Tours, said the CBN is not doing the airlines any favour by releasing the foreign currency to them.  He said CBN has to pay airlines what they are owed in dollars. 

“The rule says that at every day of sales after the airlines have paid their local taxes and charges, the remaining revenue should be remitted based on the exchange rate for that day.”

“So, delaying it for some time gives us a bad name and makes our credit worthiness in the international market doubtful.  It doesn’t give us a good rating,” he said.

No dollars law

But the CBN has explained that there is no law mandating it to provide dollars to foreign airlines.

CBN Governor Godwin Emefiele said Nigeria is determined to help airlines clear the foreign exchange backlog but insisted that the bilateral air services agreement did not mandate foreign airlines to repatriate all their dollar earnings out of the country. 

“The sector has always enjoyed priority allocation. We have always granted them the priority that they desire because we know people want to travel and they don’t want to be constrained by the need for them to travel.

“In spite of this, we have seen that the number of travels or naira value of tickets issued by the airlines has increased. We decided to release $265 million when the pressure was building aggressively. We will do everything possible and are determined to clear the backlog,” he said.

“No law makes it compulsory that you must buy your dollars from the central bank. When you put money in your account, what it means is that you tell your bank to buy your dollars,” he added. 

Mr Emefiele urged countries where foreign airlines are domiciled to provide equal landing slots to Nigerian carriers to prevent dollar repartition issues.

With Emirates out of the scene and with the patronage of other airlines, Nigerians are visiting Dubai through neighbouring African countries which they say is cheaper.

Some of the countries that are taking advantage of the flights’ suspension include Ghana, Benin and Kenya. This has caused a lull on the highly lucrative Nigeria-UAE route as airlines and travel agencies continue to count losses.

Source: The East African

The Republic of Rwanda has achieved an International Aviation Safety Assessment (IASA) Category 1 rating, according to a recent Federal Aviation Administration (FAA) announcement.  

The Category 1 rating recognizes Rwanda’s civil aviation authority as compliant with ICAO standards and allows Rwandan air carriers to operate services to the United States, according to a statement released by the FAA.  

“Under a Category 1 rating, properly authorized Rwandan air carriers are permitted to serve the United States and enter into code-share agreements with U.S. carriers without limitation,” the FAA noted.  

The FAA explained that its IASA program “focuses on a country’s ability to adhere to international aviation safety standards and recommended practices.”   

“The standards are set by ICAO, the United Nations’ technical agency for aviation,” the FAA continued.  

Direct flights to and from the US for Rwandan airlines  

The FAA announcement is favorable for Rwanda-based airlines, such as RwandAir, should the Rwandan national carrier seek to expand its international network or add codeshare partnerships with US airlines. RwandAir currently serves the US market through a codeshare partnership with Qatar Airways.   

According to a statement issued by the airline on December 2, 2021, RwandAir According to a statement, RwandAir commenced direct flights to Hamad International Airport (HIA) in Qatar on December 2, 2021, facilitated by the codeshare deal signed with Qatar Airways on October 5, 2021.  

The codeshare deal enabled customers to fly to different cities like New York, Washington D.C., Dallas and Los Angeles, London, Zurich and Madrid, Singapore, Kuala Lumpur and Bangkok.  

This also follows Qatar Airways’ announcement that it had a 49% stake in RwandAir.   

However, the Kigali based airline may take a similar approach to its service of the US market following the launch of its direct non-stop between London Heathrow and Kigali from November 6, 2022.  

RwandAir operated flights to London via Brussels for five years before launching direct non-stop flights to London Heathrow Airport.  

Source: Aerotime Hub

Ethiopian Airlines has announced a progressive goal to expand its fleet and enlarge its network. The airline’s “Vision 2035” plans, confirmed last week, will introduce more than a hundred new aircraft to its fleet.

Additionally, Ethiopian plans to add more cities to its network, totaling its destination network to more than 200 by 2035. The Star Alliance carrier is currently the largest airline in Africa and has a sizeable operation between Africa and Asia.

Becoming more profitable

Mesfin Tasew, CEO of Ethiopian Airlines, spoke to the Ethiopian News Agency about the carrier’s strategic plans to grow.

“In vision 2035, we have aimed to nearly double the number of destinations that we will be flying by increasing the number of destinations from 131 today to 207; and to cover this expansion, we have planned again to double the number of aircraft in our flight from 140 to 271. We have planned to carry 65 million passengers and 3 million tons of cargo. We aim to generate 25 billion USD revenue by 2035.”

The new plan comes as the airline has already achieved its goal for 2025. Tasew said vision 2035 would sustain the carrier’s fast and profitable growth. Ethiopian has been recognized as the most reliable and financially successful airline in Africa, domestically and internationally.

Evaluating and welcoming new aircraft

Ethiopian will reportedly make a final decision on what exactly its fleet growth will entail in the coming months. Tasew said the airline is actively looking at new Airbus and Embraer family aircraft to bridge the capacity gap between its Boeing 737 and De Havilland Dash 8-400 aircraft currently in its fleet.

“Currently, we are conducting a fleet evaluation on the narrowbody side for 100-seater aircraft: the Airbus A220 and Embraer 195 E2,” the CEO said.

The carrier will welcome its 19th Airbus A350 to its fleet by the end of the month. In July 2016, the carrier became the first airline to operate the A350 in Africa. This past summer, Ethiopian confirmed that it upgraded four existing Airbus A350-900 orders to the larger A350-1000 variant.

The carrier is also looking to add more freighter aircraft to support its cargo operation. There are 14 cargo planes in its fleet consisting of Boeing 737-800BCF, 767-300BCF, and 777F models. With the A350 already in its fleet, Tasew said the airline plans to consider the A350F.

Harmonizing a cost-effective fleet

When expanding its fleet, Ethiopian has to consider the number of aircraft types it operates. From regional planes that seat 70 to widebody jets seating up to 300, the airline has a fleet of variety, using six aircraft types. Tasew said too many types could cost the airline, according to Sam Chui.

“The concern is, two different aircraft models of the same size will increase complexity and costs in terms of pilots, maintenance etc.,” Tasew said. “When we add either Embraer E195 or Airbus A220, we would have a seventh type in our fleet. We want to be careful in further fleet evaluation.”

In addition to the A220, the airline has reportedly evaluated the A321XLR but concluded that it is not cost-effective compared to its current fleet of Boeing narrowbodies.

“We hear that it [A321XLR] is an excellent aircraft. Unfortunately, on the narrowbody side we operate more than 30 737s, which will grow probably to 50 by adding more 737-8s,” Tasew said. “Our strategy is to have cost leadership, and to have this, you have to harmonize your fleet and to operate fewer aircraft models,” Tasew said.

Ethiopian expects to solidify its fleet expansion plans for both narrow and widebody planes by the first half of 2023.

Source: Simple Flying

Air France will launch a new service from Paris Charles de Gaulle to Dar Es Salam, Tanzania, next summer as a continuation of its existing flights to Zanzibar.

The service to Tanzania’s largest city and economic hub will operate three times a week (Mondays, Wednesdays and Saturdays) from 12 June.

Air France services to Zanzibar currently operate twice a week and until recently as a continuation of its services to Nairobi, Kenya.

From 12 June next year, the airline will operate daily non-stop flights to and from the Kenyan capital, up from six flights a week.

Also starting next summer, Air France will increase services from Paris CDG to Antananarivo, Madagascar, from four non-stop weekly flights to five.

Air France partner airline KLM already flies from Amsterdam to Dar Es Salam via Zanzibar on Thursdays and Sundays and via Kilimanjaro on other days of the week.

The airline has also confirmed its new service from Paris CDG to New York Newark, commencing on 12 December, will continue as a year-round service.

Air France also expects to resume its year-round three-times-weekly services between Paris CDG and Hong Kong from 9 January.

Source: BTN Europe

Air Tanzania (ATCL) hopes to return one of its grounded A220-300s to service following the expected delivery before the month-end of a spare Pratt & Whitney PW1000 engine, says Chief Executive Officer Ladislaus Matindi.

He told The Citizen newspaper the airline was promised a spare engine following a meeting with Airbus. “We are currently making logistical arrangements with Airbus on how the spare engine will reach us,” he said. The existing engines were expected to be overhauled in Frankfurt Int’l, Germany, next month.

Airbus was not immediately reachable for comment.

Earlier this month, ATCL announced it was forced to temporarily cancel flights or reduce frequencies to address technical problems with the PW1524G-3 engines on its A220-300s.

According to the ch-aviation fleets advanced module and Flightradar24 ADS-B data, at least three of ATCL’s A220-300s are currently effectively grounded. The only operational aircraft, 5H-TCI (msn 55048), last flew on November 21 between Mwanza and Dar es Salaam, while 5H-TCL (msn 55130) last flew on November 5 on the same route. 5H-TCH (msn 55047) has been in maintenance at Maastricht in The Netherlands since January 3, 2022, and 5H-TCM (msn 55135) has been in storage at Dar es Salaam since August 27, 2022.

Meanwhile, the Tanzania Civil Aviation Authority Consumer Consultative Council (TCAA CCC) has urged airlines with technical or operational problems to consider leasing to normalise operations and avoid flight suspensions, cancellations, and delays. “We advise airlines to search for alternatives, including leasing, so that they can keep offering services in the aviation market that has been growing rapidly in the country,” TCAA CCC said in a statement.

Pratt & Whitney, in a statement to ch-aviation said a PW1500G full authority digital engine control (FADEC) software update could be accomplished on-wing and should not disrupt aircraft operations. The US Federal Aviation Administration (FAA) issued an Airworthiness Directive in October 2022 in this regard in line with a service bulletin issued by Pratt & Whitney in May 2022.

Source: ch-aviation

National carrier RwandAir has received its first cargo, a 787-800 Boeing Converted Freighter (BCF), Yvonne Makolo, the airline’s CEO confirmed to The New Times.

“Today, we took delivery of our first dedicated cargo aircraft, B737-800SF as we expand our fleet, read part of a tweet put out by the airline on Thursday upon the arrival of the aircraft

In a previous interview with The New Times, Bosco Gakwaya, RwandAir’s senior manager of cargo services, said that the plane will start with Dubai and a few intra-African routes.

“For now, the rest will stay on existing passenger planes. As we assess the market,” he added.

According to him, the development will serve as an “import-export link” to Dubai and further UAE market.

“The aircraft has a capacity of 23 tonnes, suffice to say that, for our initial destinations, we are good to go in terms of the capacity, looking at today’s demand.”

If volumes shoot up, Gakwaya pointed out, that frequency is also expected to increase.

With up to 20 percent lower fuel use and CO2 emissions per tonne, B737-800BCF operators are carrying more payload with less fuel.

The aircraft features a large cargo door, a cargo handling system and seating for up to four non-flying staff or passengers.

Capacity, rates remain an issue

Players in the export trade sector expressed optimism about the upcoming cargo flights, but also raised concerns for a sustainable solution on the costly rates as well as capacity.

Rwanda’s main export and import market are Europe and the UAE.

The exporters say there is hope that the freighter increases their export volumes and reduces shipping costs.

“The current issue is limited space for our export produce,” Emmanuel Harerimana, the CEO of Garden Fresh, a company dealing in the export of fruits and vegetables, said in an earlier interview.

“Sometimes we book space for five tonnes and before departure we are told there’s space for only three tonnes, or in some cases, products can be offloaded while still at the airport to make room for passenger’s luggage,” Harerimana added.

“With the cargo plane, we will be able to increase our export volumes and we also hope they will reduce the cargo shipping cost.”

His company expects to increase exports to over 60 tonnes, up from the current 40-48 tonnes, every month.

Commenting on the concerns, Gakwaya told The New Times that prevailing challenges had been noted in the past, adding that there is a strategic plan for sustainable solutions.

Among them, he said, was capacity, which he believes is starting to take shape.

“It has strategically been solved. Especially if you look at the fact that we split the London, Brussels route. We don’t see an issue of space now.”

When pressed for details on the strategic plan, Gakwaya said, “Work is being done to find a sustainable solution.”

RwandAir now serves 29 destinations across East, Central, West, and Southern Africa, the Middle East, Europe and Asia.

Source: The New Times