Tuesday, 25 October 2016

More on the Kenya Airways fleet....and future.

Further to our latest African Roundup's coverage of ongoing goings on in Kenya Airways the airline's excellent in-flight magazine Msafari gives more clarity on the current fleet plus the leasing out of the midlife 777-200s and  brand new leased-300s declared surplus to requirements.

Firstly the in-service fleet , 35 aircraft,  now consists of:

7   B787-8     Configuration  30J/204Y. Total 234
8   B737-800  Configuration 16J/129Y. Total 145
2   B737-700  Configuration 16J/100 Y. Total 116
15 EMB 190  Configuration  12J/84Y Total     96

This leaves aside the 2 leased out B787-8s, 2 sold and 2 parked (?)  B 777-200s and 3 leased out B777-300s.

Of these :

2 B787-8s are leased to Oman Air for 3 years, returning in 2019.
2 B 777-200s have been sold to Omni Air so are off Kenya Airways' books for ever.
2 B 777-200s do not appear to have been disposed of so are presumably parked awaiting a customer ,in which case they continue to rack up lease charges.
3 B777-300s have been leased to Turkish for 3-4 years so should return in 2019 or 2020.

The airline claims a saving of US$ 7 million a month from the leases but while reducing the cash flow pressure it is not clear whether that gives an overall profit or a loss on the deals. If it's a loss Kenya Airways will of course have to make up the difference to the headline lessors each month. That's called financial drag.

Looking further ahead the airline now has no more aircraft on order. That means the return of the 2 B 787s in 2019 should be welcome and easily absorbed in renewed growth. Painlessly reabsorbing the much bigger and then still only 5 years old B 777-300s means that the airline must by then develop a few of its key routes to keep them busy and full.  With London, Amsterdam and Far Eastern points already on the network that shouldn't on the face of it be too difficult. However if it is the airline will not be well placed to get the best deals for new leases or extensions to the existing ones. Potential customers would be in a strong position to drive down rates on offer. There should be plenty of alternatives available. These are already beginning to appear with Emirates and others rolling over the longest serving members of their fleets. That all gives Kenya Airways strategists, marketing and finance people something to keep before them for the end of the decade. In the meantime the $ 7 million a month ( an unimaginable figure in Kenya's own currency, highest denomination the shilling which needs 100 to buy a dollar or 125 for a UK pound) saving in outgoings will at least relieve the headaches for a while and give some space for the Pride of Africa to get itself together again,- if Kenya's politicians, unhelpful unions and others let it.

No comments:

Post a Comment

Note: only a member of this blog may post a comment.