African aviation recovery within COVID-19 constraints
The COVID-19 pandemic has been with us for almost two years and has disrupted our way of living and economies around the world.
The aviation sector which employs millions of people and acts as the heart of international business and leisure has been adversely affected.
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The airline industry as a whole is struggling to be above water with airlines, airports and ground handling firms in despair as revenue lines dry up.
African airlines have not been spared and have also been hard hit per the scenarios below:
• Ethiopian Airlines lost USD550million in revenues because of international flight restrictions in the first 6 months of COVID-19 pandemic
• RwandAir slashed 65 per cent of staff salaries to cut down on losses
• Air Namibia suspended flights and entered liquidation early 2021
• Late 2020, South African Airways (SAA) auctioned inflight service items such as toothpicks, chopsticks, ear plugs, raincoats etc to stay afloat
• Royal Air Maroc laid off 140 staff including pilots and cabin crew in 2020
• Creditors of Air Seychelles wanted to shut down airline early this year
• Air Mauritius was placed in voluntary administration at the start of the pandemic
• Kenya Airways lost an estimated $330million in revenues in 2020 as passenger numbers dropped by 65.7 per cent.
• Egypt Air required a $130million loan from the Egyptian government to sustain its operations
The above is just but a sample of the turbulence that African airlines have suffered for nearly two years.
The International Air Transport Association (IATA) in its latest economic forecast indicate airlines this year are expected to lose $51.8 billion and will lose a total of $200billion between 2020 and 2022.
Obviously aside from God’s intervention, the situation looks bleak, but what should African airlines do to minimise the negative effects of the pandemic?
Practical Steps Going Forward
• African airlines need to have a fair mix of passenger and cargo/freight fleets. In the midst of the COVID-19 pandemic, cargo demand has risen dramatically because of the need for vaccine deliveries, repatriation flights and increased e-commerce uptake.
Thus, airlines such as Qatar, Ethiopian, Emirates and Turkish who have a good air cargo capacity are the ones to sail above the stormy waters.
RwandAir and Kenya Airways have also made progress on the cargo front but not as much as Ethiopian!
• African airlines must buy aircraft that can be easily converted to cargo at very short notice.
Airbus claims that the A350 series can be converted to cargo in two days. This should be a factor in considering long haul aircraft purchases for example.
• African airports need to be designed to find alternate revenue lines aside from traditional ones; the Vilnius/Lithuania airport drive –in cinema is an interesting concept
• African airlines need to look at the way they couch aircraft purchase agreements going forward in light of acts of nature such as pandemics to reduce the financial impact on their operations
• Diversify revenue streams but adding new business lines.
For eg. Ethiopian Airlines and Boeing recently signed a strategic memorandum of understanding (MOU) to position Ethiopia as Africa’s Aviation Hub in the areas of industrial development, aviation training, educational partnership and leadership development
• Use the advent of the African Continental Free Trade Area (AfCFTA) to launch new African routes to enhance intra-African trade.
Air Tanzania for eg will launch direct flights to Nairobi/Kenya, Bujumbura/Burundi & Lubumbashi/DR Congo in November 2021. Again, Ethiopian Airlines has signed an interline agreement with Johannesburg -based Airlink to allow passengers seamless travel on a single ticket on any of the 2 carrier’s networks.
This, however, calls for harmonised travel arrangements, COVID-19 test procedures and fees, vaccine passports etc
• Encourage domestic tourism in African countries via strategic collaborations with the hospitality sector to sustain aviation and hospitality sector jobs.
So-called “NO WHERE” flights that fly past tourist sites (without landing) and back is a step in the right direction to keep aircraft flying. All Nippon Airways (ANA) is using the Airbus A380 to run NO WHERE flights within Japan
• Review routes & fleet size to be profitable during the pandemic. For eg. SAA after having gone into bankruptcy in 2020 has recently started operations within South Africa, Ghana, DR Congo, Zimbabwe, Zambia and Mozambique with a reduced fleet of only eight aircraft from previous 44; shedding off their fuel guzzling Boeing 747 and some of their Airbus A340 aircraft!
• Increased use of self- check in kiosks/counters with emphasis on bio security and safety like what Ethiopian Airlines has done at their Bole Airport hub. This will no doubt minimise physical contact and spread of COVID-19
Conclusion
The COVID-19 pandemic’s effect on air transport has a far-reaching impact on economies, individuals and businesses. With the drive towards vaccination, it is expected that most countries will gradually ease travel restrictions to allow for routes to be reopened to the pre-COVID-19 levels.
However, till then, airlines must survive and the backup plan is what has been suggested above.
Alan Watts, the British philosopher, once said: “The joy of travel is not so much in getting where one wants to go as in the unsought surprises which occur on the journey”.
How very true this is; in the midst of COVID-19 travel passports, lock downs, compulsory isolations, mandatory PCR tests etc.
Travel definitely has changed and not so much fun as before?
Credit/Sources: Simple Flying, www.theafricareport.com, www.mckinsey.com, www.theeastafrican.co.ke, www.worldairlinenews.com, www.flightglobal.com, www.moroccoworldnews.com
The writer is an avid aircraft enthusiast and has over 22 years of banking experience. E-mail: [email protected]