African strategies and developments-Cameroon

Sadly it seems that Camair of Cameroon is not a follower of our hints on possible strategies for smaller airlines in Africa as outlined in the item on AFRAA posted on 19th April.

An article by Christopher Jator in the Cameroon Tribune on 5th May quotes Camair's CEO,Alex van Elk, lamenting that the overall load factor is just 30% whereas 66% is required for profitability. That means that a seriously daunting 70% of seats are being flown unoccupied,-or in other words pointlessly and worse, very expensively. Hopefully this state of affairs is nothing to do with the article's revelation that "there has been feedback of public excitement during flights".

It appears that the way forward is seen as being to expand regional flying from Douala with a third 737, this one a -500 to be leased from US based ACG, with new or additional services to Libreville,Lagos,Cotonou, Dakar, Brazzaville and Bangui (note the traditional pattern of links between French speaking West African countries generally hopping over the English speaking ones other than Lagos). This is certainly a better option than pushing ahead with more long haul but there must be a question as to whether they would do better with a lower capacity jet such as the EMB 170/190 series, rather than the thirstier smallest 737. Key to Camair's problems though is probably their 5 times weekly 767 service to Paris in competition with Air France's daily 777. The ability of a lightly loaded widebody on a long haul service to lose tens of thousands of any currency you like in just a few hours can effectively gobble up chunks of working capital day by day, week by week at an alarming rate . Despite this a good number of smaller national carriers continue to persue the ambition to get to Paris or London to the end,- their end. Some governments persist in urging/forcing them to do so and then blame their managment for not making a profit out of it. Then often follows sacking of said managment, restriction of competition and the end of market growth. If governments wish carriers to operate prestige,-or any other,- routes regardless of the economics, the only answer is for the airline to do so under contract on a costs plus basis in exchange for which the revenue is handed over to the governmemt.

Another recent Cameroon development is the signing of an air service agreement with China. This could well result in the appearance of a Chinese operator in Douala to transport some of the tens of thousands of Chinese workers now in Africa. This is likelyb to be seen by Camair as a possible boost to their regional services as the passengers are taken on to their final destinations. Maybe, but they would have to ensure agreement with the Chinese carrier of profitable minimum prorates on the much shorter sectors within West Africa. Alliances and long haul carriers in general will push for the easily calculated SRP-Straight Rate Prorate in which case each airline's portion of the end to end revenue is its share of the overall mileage with no minimum guarantee. This is a disaster for domestic and regional short haul operators providing connections of just a few hundred miles from an inbound long haul sector of several thousand. This formula has to be one of the reasons why overwhelmingly shorthaul Aer Lingus left the One World alliance.

Free advice for Camair: (for which consultants would charge a fortune and gobble up time with countless glossy brochures and undoubtedly impressive audio visual presentations). Beware bleeding to death on long haul. Make the government pay or just scrub it. Also beware the Chinese bearing gifts in the shape of big shiny aeroplanes landing in Douala expecting you to disperse many of the customers for peanuts. Be very specific about your oncarriage pricing demands and stick to them.