Is the African market finally ready to fulfil its full potential? Will a new more open approach to air connectivity finally open the door to better intra-African connectivity? These are massive questions for a market that the International Air Transport Association (IATA) predicts will see the strongest growth over the next 20 years and will be home to some of the fastest growing individual country markets in terms of passenger demand.
Our regular round-up delivers some of the key aviation and travel news stories from across Africa.
- fastjet Group stops funding to fastjet Tanzania, in share sale agreement with local management
- Kenya Airways postpones launch of Nairobi-Mogadishu service pending ‘necessary approvals’: CEO
- South African skies go stale for Mango as acting CEO sees limited opportunities in challenging market
- Ghana’s aviation ministry is reviewing the cost of fuel
- Air Burkina set to add three E-Jets from Nordic Aviation Capital
- Air Mauritius hit by increased competition, 51% spike in fuel costs in 3Q2018
- ROUTE UPDATE: latest route launches and announcements
- DATA SNAPSHOT: African in-service fleet by manufacturer (as at 19-Nov-2018)
fastjet Group stops funding to fastjet Tanzania, in share sale agreement with local management
fastjet Group announced it has decided to stop all funding to fastjet Tanzania and its operation in Tanzania now “represents a discontinued business”. fastjet entered a conditional share sale agreement with local management in Tanzania in relation to the sale of its interest in the holding company of fastjet Tanzania. The Tanzania business delivered a trading loss of USD4.7 million in the four months ending Oct-2018, which the company attributed to the deployment of Boeing 787 capacity on domestic routes “at below cost yields” by Air Tanzania and regulatory delays in deploying additional aircraft. With the exception of Tanzania, trading for the period was “broadly in line with management expectations”. Performance improvement is ongoing in Zimbabwe and Mozambique. FedAir in South Africa delivered a trading profit while providing a base from which the fastjet brand can gradually enter the market in 2019. fastjet CEO Nico Bezuidenhout said: “Business in our continuing operations in Zimbabwe and growth markets of South Africa and Mozambique is on the right track and revenues from these markets now cumulatively exceed that generated in Tanzania… The steps taken in acquiring the fastjet brand in 2017 allows fastjet to change the deployment model in Tanzania away from one where we assume equity risk and funding obligation, in its stead aiming to deploy the brand in Tanzania on a franchise basis”.
Kenya Airways postpones launch of Nairobi-Mogadishu service pending ‘necessary approvals’: CEO
Kenya Airways CEO Sebastian Mikosz said the airline delayed the launch of daily Nairobi-Mogadishu service from 15-Nov-2018 to 05-Dec-2018 “due to additional airline and operational requirements beyond our control”, reports Kenyan media. He added: “We are engaging the relevant authorities on the necessary approvals and we expect to finalise this process as soon as possible”.
South African skies go stale for Mango as acting CEO sees limited opportunities in challenging market
Mango acting CEO Marelize Labuschagne said growing fuel costs, “deterioration” of the rand and an economic downturn represent “challenges” for the aviation sector. She noted: “There has been a decrease in overall capacity, though the increase in demand is lower than the decrease in capacity. This has resulted in higher overall load factors, but at similar fares than the prior year. Everyone is currently just trying to defend their market share”. Ms Labuschagne noted the economic downturn resulted in a shift in demand from full service to low cost carriers. She added: “In line with the market trend, there is pressure on margins and focus is being placed on the control of expenses and retention of market share”. Ms Labuschagne also said: “Positive cash flow will be the key to the survival of the low cost carrier market. As the domestic demand has not grown, investment in alternative markets will be important. Focus on service delivery and providing value for money is important for market share retention”. She stated: “Due to current market density in the domestic market, there are no further opportunities for Mango at this stage, but we are looking at various possibilities on a regional level”.
Ghana’s aviation ministry is reviewing the cost of fuel
Ghana’s Minister of Aviation Joseph Kofi Adda said the ministry is reviewing the cost of aviation fuel in the country. The findings will be passed to the Ministry of Finance for potential further action. Mr Adda commented: “It is our duty as a government to consider the various factors that impact on [airlines’] profitability. The cost of fuel for instance is a major contributor”. He added: “We will do everything to make the environment competitive for airlines”.
Air Burkina set to add three E-Jets from Nordic Aviation Capital
Air Burkina will reportedly acquire an Embraer E175 and two E195 aircraft between Nov-2018 and Jan-2019 under an agreement with Nordic Aviation Capital, according to reports. The first aircraft reportedly arrived in Ouagadougou on 14-Nov-2018 and the remaining aircraft will be delivered in Dec-2018 and Jan-2019.
Air Mauritius hit by increased competition, 51% spike in fuel costs in 3Q2018
Air Mauritius reported passenger yield decreased 4.3% year-on-year in 3Q2018 due to “acute competition”, despite an 8.8% increase in passenger numbers and a 0.6 of a percent improvement in load factor to 81.3%. Operating revenue increased 7% but operating expenses increased 23.3% mainly due to a 51% increase in fuel prices, expanded operations, greater labour costs and the lease of new aircraft. The carrier expects its results will continue to be impacted by “prevailing high fuel prices, volatile exchange rates and increased competition”. The company is engaged in a business model review to ensure sustainability with a focus on development of the Mauritius hub.
- Air Austral plans to increase Reunion-Johannesburg frequency from twice to three times weekly, effective 18-Dec-2018 to 29-Jan-2019 and again from 05-Mar-2019, according to the CAPA Route Changes Database.
- CemAir plans to commence 10 times weekly East London-Port Elizabeth service on 14-Jan-2019.The airline will operate the service with Beech 1900D equipment.
- Turkish Airlines plans to increase Istanbul-Sharm el Sheikh frequency from seven to 10 times weekly on 01-Apr-2019 and Istanbul-Hurghada frequency from seven to 10 times weekly on 31-Mar-2019.
- Air Cairo launched three times weekly Cairo-Aswan, twice weekly Cairo-Luxor and twice weekly Cairo-Sharm El Sheikh services on 16-Nov-2018, for the winter schedule.