African Roundup June-July 2015

Two of sub Saharan Africa’s three major airlines are in trouble. What have they in common and why does the third continue to expand successfully?

Much of the answer is simple. Both are suffering from Government intervention (SAA) and trying to intervene (Kenya Airways). Government/political interests trying to impose solutions on managements invariably leads in one direction. That doesn’t only apply to the aviation industry.

  SAA is heavy with long standing debt and management issues and still struggles to manage its transition to the new South Africa. Kenya Airways is very different and has only recently become increasingly loss-making leading talk of possible bailouts, emergency loans and recapitalization. Depending on how this is provided the Kenya government could regain a majority stake and the independence gained at privatisation would in effect be over.

Kenya Airways was privatised in 1996 leaving government with a minority share. Some politicians have always seen this as a door to being able to make interventions. The first Chairman, Philip Ndegwa, who unfortunately died of cancer while in office, was a resolute bulwark against this. He was also determined to be truly non executive and keep himself away from the day to day running of the airline. With the help of Speedwing Consulting he hired a high performing quartet of top managers to do that and kept the political roof up while they did the job. His immediate successor had a different view about the about the non executive issue and acted accordingly.

 SAA on the other hand has always been 100% state-owned and currently relies on Government for regular cash injections and guarantees to continue operations. Technically it is insolvent. Things came to a head in 2013 when Government demanded a detailed action plan prior to release of more cash. Following the departure of yet another CEO in 2014, the new Acting CEO Nico Bezeidenhout, was charged with preparing and implementing a 90-day Action Plan to accelerate the flagging progress on the Long Term Strategy Plan.  Measurable cost improvements were made with route cuts, fleet leases and supply contracts but operating results have continued to fall. ‘It’s too early to say we have turned the corner’, said Bezuidenhout last month. CEO of SAA is not a job for the feint hearted.

 It appears that problems at SAA’s Board have continued unabated. Late in 2014 the CEO was suspended and 6 board members were dismissed. The Chairwoman, Dudu Myeni, attracts criticism from her close relationship with President Zuma. A new Board is due for appointment in September.  Difficulties around the Board table have now prompted the resignation of Chief Strategy Officer, Barry Parsons, citing his ‘loss of confidence in the Board’. Within days the Chairwoman announced to staff that Bezuidenhout would immediately be returning to his CEO role with Mango ‘having completed (his) turn-round project’.  One can only speculate on the underlying reason. For the eighth time in 3 years and in the middle of a major recovery exercise SAA again finds itself without a CEO. There is little confidence in management stability and this has to impact on its effectiveness. South African tax-payers will continue to have to fund SAA for a while yet.

Kenya Airways has yet to reach these depths but the downward trajectory is worrying.  The past 3 years have seen the carrier plunge to ever increasing losses.  The operating shortfall for 2014-5 has been declared at US$290million, a sharp deterioration from the 2012-3 figure of US$91m, the first loss since privatisation. In 2011 the airline was riding high with the unveiling of Project Mawingu, a 10-year plan to effectively double the size of the fleet and to double the number of points on the route map, including the Americas and Australia. Now it is selling off its flagship 777s and retreating to an eight strong (seven delivered) B 787-8 fleet. It has no further widebodies on order and it’s unclear where Mwangu will go now.

Almost immediately it was published the positive Mawingu forecasts took a battering. Production difficulties delayed Boeing 787 deliveries leaving the 767s to soldier on but not for long enough to justify a major refurbishment. Instability generated by Al Shabaab in response to the Kenyan forces intervening in Somalia started to affect incoming tourism particularly the high volume/low yield coastal business. The disastrously mishandled fire at Jomo Kenyatta Airport and the decline of the Kenya Shilling added to the general woes. Then came the even more disastrous and worse handled Westgate shopping centre incident. Tour operators and their clients headed for safer places. Meanwhile the new Boeing 737s and Embraer 190s continued to arrive along with the much larger than needed B777-300s. Financing and other ownership costs kicked upwards leading to the under utilisation of the B777-200 fleet .The -300s were recently sold and the bulk of the long haul operation downsized to the B787-8 which  hasn’t the cargo space of the 777. That and the limited holds of the Embraers has limited the ability of cargo to make up for some of the revenue lost on the passenger side of the business and has for the time being jeopardised Nairobi’s position as a cargo hub for Africa.

Despite the enforced economy measures the cumulative losses have continued to rise to the point where the need for US$500-600m is being mentioned to maintain operations. That has given politicians their excuse to get back into the scene. Consultants Seabury have been charged to re-shape Project Mawingu and to recommend options for a recapitalization. This risks a sense of instability and insecurity and the airline feeling as if it has stalled and lost its way.

Kenya’s northern neighbour and rival Ethiopian, historically and remarkably left alone by its government, meanwhile marches resolutely on, expanding its fleet and network in an almost Gulf-like fashion. It continues to grow and finance itself and is seen throughout Africa as a good, well established, reliable and well managed business. Its home base, while tight on capacity until its terminal expansion is completed in 2018, raises no negative security, attitudinal and other images. Passengers aren’t hassled. The airline’s  management is home grown and knows, goes about its business professionally and has good networks in the industry. All of these things contribute to its remarkable success over several decades.

1.  EAST AFRICA

Air Djibouti has announced the re-launch of operations in November this year with a mixed five aircraft fleet of B737, B757 and B767, in conjunction with Cardiff Aviation (UK). This looks a bit too mixed for comfort.

Daallo Airlines (Djibouti with Head office in Dubai) plans to add 2 leased ATR72s for domestic operations.

Ethiopian Airlines orders for the 6 additional overweight early production and consequently cheap B787-8s will raise the total fleet to 19.  They will be delivered mid-2016.

The hub-based network continues to grow apace with the 19^th June addition of Addis-Dublin-Los Angeles B787s followed on 9^th July by Manila coming online thrice weekly 767s behind Bangkok.

The Q400 Goma operation hasn’t been as successful as hoped. It had to be abandoned after a single flight but doubtless will be back.

Fastjet ,never one dwell on the negatives, reports its intention to fully launch its Zimbabwe and Zambia incarnations shortly. Meanwhile it has sold the non-operating Fly540 Ghana for US$1. That’s not a lot. There is no mention of a sale of defunct Fly540 Angola so maybe there is hope of using it as a platform to which to return later. Angolan burocracy and deeply rooted protection of TAAG will not help. The fleets of both carriers, – ATR42s and 72s, - were disposed of in May 2014.  The minority shareholding in Fly540 Kenya, which was bought as a quick way to a Kenyan AOC but didn’t work out was sold back in 2014.

In the meantime 27 July saw the launch of twice weekly A319s between Dar es Salaam and Lilongwe adding to the previous links to Johannesburg, Lusaka, Harare and Entebbe. There are also five 5 domestic Tanzanian routes.  Kenyan CAA logs appear to continue to lie across the road to the Tanzanian company flying between Dar es Salaam and Nairobi despite it having been perfectly legitimately designated to do so by Tanzania’s government. The airline continues to await confirmation by the Kenyan CAA both for an Air Service Licence as a necessary step to establishing ‘Fastjet Kenya’ and for recognition of ‘Fastjet Tanzania’ as the designated Tanzanian carrier in the Kenya-Tanzania BASA.

 Fleetwise the lease has been signed for a fifth A319. This one is set to be allocated to Fastjet Zimbabwe on successful completion of its Zimbabwe AOC application.  The Air Service Permit has been granted.

Kenya Airways Services to Freetown were resumed on 2^nd June after the ebola-induced  suspension.

 Faced with increased competition when China Southern start their thrice weekly Guangzhou-Nairobi A330-200 on 3^rd August services the airline has signed a codeshare agreement with the Chinese carrier, giving them at least make a small percentage any of these flights sold on Kenya Airways tickets. It is unlikely that will make up for likely losses of business to the new competitor unless between the two the amount of transfer business using Nairobi to access the rest of Africa grows hugely.

2.  SOUTH / CENTRAL AFRICA

Air Zimbabwe restarted their Harare – Lusaka link on 22^nd June. An MA60 is used. Not an aircraft likely to have a strong following as the customers’ first choice.

Blue Sky (Botswana) is seeking two B737-300s in preparation for Gaborone-Maun/Johannesburg and Cape Town operations. An Air Service Licence was awarded in January and an AOC application has been lodged.

Congo Airways (DRC) has taken delivery of two A320s for a 15 August launch based on Kinshasa and Goma.  This is intended to be a new national carrier and its AOC is pending.  Air France Consulting is involved.

flyafrica.com Namibia is planning a revised September launch using a pair of 737-500s flying between Windhoek and Johannesburg and, separately, Cape Town. All regulatory hurdles have now been cleared.

FlySafair (S Africa) is to launch four new routes linking both Johannesburg and Cape Town with Durban and East London in October. This carrier, which has grown out of the decades old all cargo Safair, currently has a fleet of two B737-400s.

Proflight (Zambia) has launched eleven weekly flights between capital Lusaka and copperbelt Kitwe .To help with this it has extended and converted from wet to dry the lease of a CRJ1000.

Rainbow Airlines (Zimbabwe) plans to join the Harare-Johannesburg fray on 31^st July using a leased B737-300 twice daily. An Air Service Permit is pending but it should be born in mind that out of thirty of these issued by the government in recent years not one has resulted in continuing operations. Sobering?

SAA We have covered the overall situation in our opening. Efforts continue to sort out the future fleet. One move is to switch the existing order for ten A320s to five A330-200s.

 Adding to the staffing and experience turmoil, Chief Strategy Officer, Barry Parsons, resigned on 24 July. He cited a loss of confidence in the Board “to lead and progress the business” towards achievement of the 2013 Long Term Turnround Strategy objectives.

 In another move which underlines the stability at the top 30 Acting SAA CEO, Nico Bezuidenhout, returned to low cost subsidiary Mango with immediate effect on 30^th June. Board Chairman, Dudu Myeni, said this follows the completion of the turnround programme which he led and that a new CEO will be appointed to the main airline ‘in due course’. Human Resources Manager, Thuli Mpshe, is appointed Acting CEO. Many would say that the turnaround programme is still work in progress (see the previous paragraph) and demands strong, firm, clear leadership protected by the Board from any external interference.

3.  WEST AFRICA

Air Guinea-Bissau:Tmhis new national carrier has a 40% Government holding and reportedly 60% Romanian interests. Two unspecified aircraft are initially to operate to Dakar and Praia.

Air Niamey (Niger) has received the first of two A320-200s for domestic services. Behind the facade the carrier is an ACMI/adhoc charter provider based in Istanbul. Government owned Air Niger collapsed in 1993.

Air Peace (Nigeria) has added two B737-300s to its active fleet of a single Do328 and a trio of B737-500s .

Med-View Airlines (Nigeria) has acquired a single B767-300 for Lagos-Jeddah-Dubai services planned to start in November this year. This won’t have an easy time up against twice daily Emirates B777-300ERs. The current fleet comprises 3 B737-400 and one B737-500 operating a domestic network plus Accra.

SmileAir (Ghana) is a proposed start-up using ex-Iranian B747s. Toronto, Dubai and Guangzhou as destinations along with a West African regional network. Bearing in mind the considerable operating costs of these long haul flights it will need high load factors from the outset. Again, the Dubai route will be quite a contest with the daily Emirates offering.

4.  NORTH AFRICA

Air Arabia Maroc is launching twice weekly Marrakesh-Frankfurt flights in October. This will be their seventh European destination to be added during this year.

EgyptAir has issued an RFP for 8-10 narrow-bodies for deliveries throughout this year.

Royal Air Maroc is planning a joint venture with Qatar Airways giving codeshare opportunities over a wide network eastwards from Doha. The carrier itself will fly three times weekly between Casablanca and Doha with 787s alongside Qatar’s daily services. Plans for a direct route to Beijing will be dropped, a considerable cost saving. It likely that membership of Oneworld will now be sought to replace earlier plans to join Star Alliance.

Syphax (Tunisia) cancelled its 2014 order for three A320-200s and then suspended all operations. The fleet currently consists of two A319s.

Tunisair has received its first A330-200. It is planned to use them from September on medium haul routes including include Paris, Dubai and Istanbul. Further afield Montreal is also envisaged around the same time. The previous fleet was all narrowbody, made up of 17 A320s and 4 A319s.

5.  NON-AFRICAN AIRLINES

Air China has deferred until late October the launch of its Beijing – Johannesburg route to be operated  thrice weekly by B777-300s.  SAA withdrew their flights on 28 March.

Atlantic Star Airlines (UK) .The planned London – St Helena B757-200 charter link from Easter 2016 on completion of the airport construction is back to square one.  Titan Airways (UK), who were to provide the aircraft have withdrawn from the project.

British Airways, demonstrating their different take on “Out of Africa”, is to drop Entebbe from network on 2^nd October. This follows previous withdrawals from Dar es Salaam and Lusaka. Weak results are given as the reason. Its 767 operations on the eastern side of the continent now come to an end. If they had continued all these routes 787s would have taken over as the 767-300s were withdrawn. With that would have come the higher costs of ownership of the new aircraft. This, together with more lucrative opportunities from deploying the 787s elsewhere, may have tipped the balance.

Brussels Airlines. Unusually, this airline which when seen as a continuum from its predecessor Sabena, is probably Africa’s most tenacious non based specialist and which has flown most of its routes through thick and thin since the 1940s, will withdraw from Nairobi in October after 58 years of service. The Belgian operator thrives in what others see as difficult niche markets and is seen by many political leaders on the continent as a steadfast friend whereas others tend to be fair weather only and come and go. The airline has earned a huge amount of respect for staying the course. The relationships generated have paid and will continue to pay unseen and unquantifiable dividends (something many airlines’ marketing and finance people find hard to grasp). Perhaps Nairobi, with its busy and until recently successful national carrier plus a host of Gulf, Turkish and other operators and Lufthansa due to return this northern winter, is now a bit too mainstream and therefore no longer a natural for this resourceful airline.

Condor launched operations on the Munich-Zanzibar-Mombasa and Munich-Windhoek routes at the end of June. It is assumed that the bulk contract leisure market will be its focus.

Emirates is planning to add Bamako to its network on 25^th October.

Fly Dubai launched 4 times weekly B737-800 flights to Hargeisa, Somaliland on 9^th June. This is its 16th African destination. Asmara, planned for October, looks like being next.

Lufthansa ,as commented above, is back in Nairobi after an 18 year gap. Originally like most European airlines Lufthansa served the city en route to Johannesburg. Right up to the 747-199/200/300 aircraft didn’t have the range to do Europe-Johannesburg or worse hot high Johannesburg-Europe nonstop. Nairobi became the traditional en route call for most. Then in the late 1980s and early 1990s came the 747-400 which could overfly en route points with ease, - so most did. The by then traditional early morning and late evening sight of the European majors’ tails at Nairobi disappeared quickly disappeared. There just wasn’t enough local business to support terminators and a one stop offering in the South African market was no longer competitive. Lufthansa did persevere for a while with terminating nonstop A310s but they struggled, particularly against BA’s B747s most of which continued to other points such as Dar es Salaam and Entebbe to bolster the loads and ensure profitability. The German airline therefore withdrew after a while due to unsatisfactory results. Now they will be back, initially with A340-300s.

6.  MISCELLANEOUS

Nigeria .In an effort to strengthen the industry and consolidate some carriers into which they  had to pour money (See the following paragraph) the Government may require domestic operators to have a minimum fleet of 5 aircraft and capital requirements of at least US$12.5m and US$25.0m for international operators.

As part of this thinking the Government is also considering merging its debt laden airlines to create a new national carrier. This echoes a similar, failed, 2013 proposal. Government holds a stake in several cash-strapped airlines through the Asset Management Co (AMCON) having injected up to US$500m in debt relief in recent years.

South Africa The High Court heard a case lodged by Comair that the regular ‘state guarantees’ given to SAA are in fact subsidies to avoid liquidation and these need full parliamentary approvals which hadn’t been gained. On this basis they asked for Government’s recent action to be declared unconstitutional and unlawful.  On 1 June, the judge dismissed the case.

John Williams

August 2015

Scandinavian unions try to give Ryan Air a Danish pasting.

Union membership is not required under Danish law. That's the good news. Industrial action based on disliking a (foreign) carrier's employment practices is OK. That's the less good news.

The Danish courts have ruled that handling and other companies can boycott Ryan Air's aircraft because the unions take exception to some of its attitudes to employment contract and the fact that the company won't enter a Danish collective bargaining agreement. The law doesn't  require them to do so but perversely it does allow coersive industrial action.

What's the problem here? Simply that mold breaking  Ryan doesn't do things the Danish way. They don't of course do anything anyone else's way either but that's beside the point. The Irish are in the stocks. It might have been others such as Thai, Singapore and Emirates who also organised in a very non Danish ways but they are off the hook at least for the moment.That's the (bad) luck of the Irish.

The whole thing is a nonsense. Ryan will still fly in and out of Danish airports including SAS's main base Copenhagen where it will just drop a few local jobs.The Irish airline provides the majority of international links from the Jutland's Bilund airport where it also generates a good number of jobs which makes any hostile action is less likely there. Well paid union bosses have been quoted as saying: "These are not the kinds of jobs we want in Denmark anyway". Who are "we" in the unions to usurp people's right to decide what jobs people can and can't do or whether they should be queuing at the local Job Centre instead?

The unions may find that by singling out Ryan  they have bitten off more than they can chew. The previously combative Michael O'Leary has been having a bit of a quiet time lately thanks to the company's new "Be nice to people" policy ,so he's probably ready for a good scrap especially one in which he can be positioned as championing the customer.

 A leading article in a Danish paper has labelled the unions' court victory as likely to be short term since Ryan Air are likely to take Denmark to the European Court and probably win. The union leaders, clad in Vietnam tailored clothes and clutching all kinds of electronic devices produced in oriental countries all lacking Danish style labour rights, should think about that while they celebrate.

Singled out for a pasting, the Ryan would  make a good fist of a legal case. Michael O'Leary has commented that they have never seen anything like it in Europe, even in over the top labour protectionist places like France, Italy and Spain. On the sidelines there lurks a feeling that highly unionised legacy SAS which has industrial relations issues of its own isn't too unhappy to see their upstart energetic expansionist low cost competitor under fire.

Hubs, narrowbodies, network and price,- The Turkish option.

I’ve been a frequent, if somewhat reluctant, transfer passenger at Istanbul for a few years now. For a couple of my usual destinations from Copenhagen such as Baku or Cairo it more or less makes sense when coming from northern Europe if a direct flight is impossible, but for my most recent travel to Accra it patently does not, unless ticket price is the number one consideration over travel time (approx 15 hour chock-to-chock schedule as opposed to around 10 hours via Amsterdam, London or Frankfurt). If it was my own money, I would (and indeed have) paid the extra for the better transit time.

Turkish airlines ‘short haul’ and economy class themselves are no better or worse than most others operating in Europe, although you do get a fairly good meal, at least compared to the packet of peanuts that you would be lucky to receive on one of the European ‘full service’ carriers. Seat sizes vary depending on aircraft type. On this round trip of 4 Turkish flights I get to try the A321, B737-900ER (twice), and the A330. The 737 offers the most personal space, the A330 the least (I type this on the A330. It is physically impossible to open the laptop on my own tray table, luckily I have a spare seat next to me so am sitting sideways and using belonging to that. The northbound 737 last night from Accra had the novelty of having seats that did not recline, so while opening a laptop would have been possible had I wanted to work at 2am, a few extra degrees of  nocturnal recline was not available .You obviously cannot have it all, at least not all at the same time.  

 And so to Istanbul. The transfer itself is straightforward when coming from Europe, in that you do not have to go through security or passport control. Coming from Accra, Baku and Cairo (and presumably any other place where the security arrangements are considered by Istanbul to be dubious), you do have to go through security, which can be a long process given the high volume of transfer passengers. Coming from Copenhagen however you are simply herded up to departures and are then free to recover from your last flight and prepare for your next one. In my case, economy class or not, thanks to my Star Alliance gold card this means heading for their excellent, very large, but often still crowded lounge.

Getting to the lounge is tricky though. Not that it is difficult to find, but because Istanbul airport is crowded.  Turkish proudly advertises that it flies to more destinations than any other airline and it shows. The ramp is crowded with A320s and B737s wingtip-to-wingtip, more often than not on remote gates that require buses. Most of the passengers are not flying to or from Istanbul but in transit between 2 other places. Like the “new” Gulf majors that’s what their business model is all about. Inside the terminal, expanded from the copper-roofed polygon I remember from holidays in Turkey in the late 1980s, the masses of transit passengers are loitering, being fed, or getting lost trying to find their next flight. Even the vast, 2-level Turkish Airlines lounge, reputedly the largest in the world, is often very busy, with passengers shuffling between the various different food and drink ‘stalls’ and trying to find a suitable place to sit. The facility itself is great, with good and plentiful things to eat and drink, masses of natural light (though no view of the ramp for the plane spotters) and all laid out in a Grand Bazaar style. I’m just not sure it is meant to feel like the Grand Bazaar in terms of the number of people in it.

 If however you are lucky enough to secure a spot on one of the sofa-type things then you are going to have a reasonable time while you wait.

Next up is getting your next flight. As most gates require buses, boarding typically starts an hour before scheduled departure, and in general is completed on time. However you then hit another feature of Istanbul’s capacity problem. You cannot take off. Typically you face a half hour delay on chock time, followed by 15 – 30 minutes before you actually start flying. This must cause a hub-and-spoke system quite some stress. Turkish seem to schedule about an hour turnaround at their destinations, so if they are close to an hour late on arrival they need to be pretty sharp to get back to their Istanbul hub in time. They do seem to have taken this into account with their schedules, which to put it politely are somewhat generous.  The Istanbul – Copenhagen leg is scheduled at 3 hours 20 whereas the flight time is 2 hours 45. Likewise the schedule for the legs to and from Accra add 30 minutes to the actual flight time.

Once finally lining up to take off, you may then get to experience a very interesting use of runways…

My flight was due to depart from 17R. About 1 in 4 departures are on that runway. The other 3 in 4 were from 35L – that’s  the opposite end of the same runway.

Simultaneously, Runway 05 was being used for arrivals. From experience at Istanbul it is fairly normal to use 05 for arrivals and 35L for departures, but the use of 17R as well is unusual and it would appear to the casual observer potentially quite hazardous. Taking off from 17R requires a gap both in departures from 35L and in arrivals onto 05, as the threshold for 05 is very close to the far end (ie the ‘35L end’) of 17R.

In addition a rise in the middle of 17R /35L means that one end is not visible from the other. No room for a mistake by ATC there. I’d be interested to know why both ends of the same runway are in use. Would it not be simpler and more fail-safe for southbound aircraft such as ours to do a U-Turn after take-off, rather than take off towards the south? The only reason I can think of is that the queue for 35L was getting so long that it was backing onto the apron, and so a few aircraft were directed over to the other end to relieve the pressure by expediting their departures.

Go to link https;//www.dropbox.com/s/ck421p4j7nvcxkw/201506%20Approaches.pdf?dl=0   for pictures of:

1) Waiting near the end of 17R.

2) Turning onto 17R to take off. Note the hill meaning the opposite (35L) end is not visible.

3) After take off from 17R. A couple of plane are visible under the leading edge of the wing waiting to take off from 35L, and the threshold of 05, being used for arrivals.

Finally there’s the question of how far people are willing to fly on a narrow body. The Istanbul – Accra leg is flown by the 737-900ER, and takes close to 7 hours. It does feel like a long way to fly in a small-ish aircraft, but it’s not intrinsically worse than flying in a wide body in my book. Turkish relies on the ‘pile ‘em high, sell ‘em cheap’ model and it seems that for the majority of its passengers the ticket price is far more important than the width of the tube in which they will be sitting.  The 737 is noticeably bumpier over the Sahara when compared to a larger wide body with more weight and size mass but not to the point of discomfort. More importantly the narrow bodies are usually full, which would imply the either need either to increase frequencies or go for larger aircraft.  Given Istanbul’s runway capacity issue, bigger aircraft would appear to be the only way to go right now.

Turkish Airlines and the Istanbul hub no doubt make sense in a lot of cases .Firstly when ticket cost is the primary driver, as this trip was approximately half the cost of the next-lowest bidder (KLM, BA and Lufthansa, who all had similar higher prices). It also makes sense when there is no direct flight and Istanbul is in a logical direction . My previous transits from Copenhagen to Baku or Cairo fall into this category.  But when flying from north west Europe to west Africa  I’d not choose to go this circuitous way if the decision was mine.

Footnote: On arrival in Copenhagen I found my check in bag was still in Istanbul. Obviously it takes about an hour after landing to figure out that no, yours is not going to arrive. Then you fill out all the forms, queue to hand them in and get a reference number and so on.  Yes, other airlines have lost my baggage too, but especially after an extended journey time it’s the last thing you need.

-Andrew Woodrow-

African Roundup April May 2015

Further talks on the creation of Air Cemac, a putative successor to Air Afrique, have been abandoned. This may well see the ghost of Air Afrique finally laid to rest but one can never be sure.  Air Afrique, established in 1960, ceased operations in 2002 It was designed as an element of France’s African decolonislation programme aimed to give newly independent former French colonies a share of the cake including on the lucrative Paris routes while carefully ensuring that Air France remained dominant.  The French carrier held 17% of the shares and the 11 newly independent states held 6% each.  The management difficulties were profound as each country vied for national preference, staff numbers swelled, and escalating cash problems just got worse. Had these latest talk succeeded Air Cemac would have looked startlingly familiar. Air France was to be the major shareholder and 6 states would have held 5% each. Almost certainly the problems,- and the eventual result,- would also have been similar.

Trying to re-creating failed carriers in almost their previous form is a rotating feature of sub-Saharan Africa. Usually missing though is the realization that the new entities, their governance and what they did would have to be very different from the originals. Examples include Cameroon Airlines being replaced with Camair-Co, Ivory Coast replacing Air Ivoire with Air Côte d’Ivoire and Malawi with new Malawian Airlines. All are near mirror images of their failed predecessors,– small fleets, small networks ,an unchanged business philosophy always struggling with poor capitalization and inadequate revenue flows with little real chance of improvement without greatly increased investment. But then for most just where is there for them to go? 

Fastjet and FlyAfrica aim to break out of these failing models. They offer refreshing new ways of doing business but they face underlying national hostilities to and distrust of things foreign. These things are remain powerful obstacles. Both still face a long slog to actually get the necessary traffic rights they urgently need to reach the essential critical mass of networks and frequencies. Meanwhile travel around Africa, while improving, is as ever, hobbled by lack of new city pairs and frequencies. Chicken and egg questions abound.  If Fastjet and others can not break the mould then others will not be encouraged to follow in their footsteps.

Fastjet’s communications are excellent. They publish clear objectives and some useful figures and radiate an optimistic stance. Getting from intention to aircraft on the ramp though is another matter. Despite the Presidential exchanges which saw Tanzania drop its restrictions on Kenya Airways in a matter of days, Kenya remains silent on the Tanzanian company’s perfectly legitimate reciprocal application to operate into Nairobi.

Kenya Airways, largely free of Kenya Government involvement in its affairs since its privatization is now being drawn back towards the governmental flypaper. Its recent declining operational performance and operating losses of 2013 and 2014 and need for new money have opened the way to parliamentary scrutiny and, if politicians and civil servants get their way, ongoing involvement.

The vehicle used to achieve this is a Parliamentary Senate Select Committee which will inquire into the airline’s business model and financing since 1996, the year of privatization when KLM took a 26% shareholding. Until recently the airline has created and ridden the momentum of a growth strategy and been conspicuously successful. The Kenya Government continues to be the largest single shareholder with 29.8 similar to KLM’s but it does not own the airline.

Lately some things have gone a bit awry. The West African ebola outbreaks have badly hit business on that side of the continent and security incidents in Kenya have made people think twice about visiting the country or even transiting Nairobi airport. The fleet has taken on a bit of a lopsided look too with the addition of over- large 777-300s rather than a larger number of smaller aircraft to spread the network and the downside risks. Disposing of all the 777s will at least make the 787 in all its models the standard widebodied vehicle. The -8 in particular looks like the trans-Africa dream machine, offering the right numbers of seats and useful cargo capacity. As we have pondered before, can the narrowbodied 737-900 really hold its own on the long 6-7 hour sectors in the medium/long term. They are acceptable if there is no option but when there is it could be game over.

Ethiopian Airlines, Africa’s fastest growing airline, adds Gaborone and Cape Town in June. Next up will be an eastern spoke to Manila via Bangkok from July as the network continues to expand its already dominant position on the continent taking its international destinations to 86.

A byproduct of Ethiopian reaching further into southern Africa is that Air Botswana’s role as a feeder of international traffic over Johannesburg will be under more pressure. Its recent codeshare deal on Kenya Airways flights to Nairobi will also take a hit. Again this is a small carrier with a small fleet and small network and with government the sole shareholder.  Its home market, Gaborone is tiny, just 350,000 residents. Success with a new 5 year plan including fleet renewal will be challenging.

Another small carrier facing difficulties is Korongo Airlines, the 2012 DRC start up, a joint venture involving Brussels Airlines and local investors. Startup was delayed for 2 years awaiting local regulatory clearances.  Initially operating with HS146s it now flies a single

B737-300. Based in Lubumbashi the network covers just Kinshasa and Mbuji Mayi plus Johannesburg.  Now it is facing the almost inevitable revenue and cash flow problems and is seeking external financing.  Shareholder Brussels Airlines is sticking by their policy of no further cash injections. Where does it go now?

1.  EAST AFRICA

Ethiopian Airlines is as seen from the above is as active as ever. It will switch westbound Toronto and Washington flight refuelling stops from Rome to Dublin although it currently has no traffic rights across the Atlantic from Ireland. The eastbound flights will in any case operate nonstop across the Atlantic to Addis Ababa so any business would be one way only.

On 21^st April the airline extended three weekly B787 Hong Kong frequencies to Tokyo and in July will serve manila similarly with B767-300s. The difference is that Manila is a short ninety minute sector which can be done cheaply in a single crew duty day. Additionally if traffic rights can be obtained there is a lot of low yield but high excess baggage local labour traffic available. 

Fastjet has been awarded an Air Service Permit by Zimbabwe. That doesn’t mean that flying now starts without further ado. The next step is to apply for an AOC application is the next step.  Domestic Harare-Victoria Falls and Bulawayo services are likely to precede international routes. Existing Dar es Salaam - Harare services are operated by Fastjet Tanzania.

The airline has raised US$74m additional funding to meet ‘ongoing operational costs’ and fleet expansion by one or two aircraft plus the establishment of new companies in Zambia, South Africa, Zimbabwe and Kenya.

Jambojet added a leased Q400 to serve coastal points Lamu,Malindi and Ukunda.  Its current fleet is 3 former Kenya Airways’ B737-300s.

The company then received a court order to cease operating these following an unhelpful claim by KALPA (Kenya Airline Pilots Assosciation) that it does not hold an independent AOC. Again one has to wonder whether for Kenya Airways setting up and running an arms length low cost carrier is worth doing. It has previously dabbled in a nominal separate low cost carrier (Kenya Flamingo), cargo venture (Kencargo) and Nairobi ground handling agent (KAHL-Kenya Airways Handling Limited) but none, each with its own Board, seem to have justified their “separateness”. Being able to call ones business a Group makes for nice titles but adds rather than reduces layers of management and the complexity and cost of corporate reporting.

Kenya Airways. The plan is to retire the B777-200 and B777-300 fleets. The last 777-200 operated on 18 May and the last 777-300 flight is scheduled for 26 Sep.  Future focus will be on additional B787 variants more suited to juggling demand levels which tend to rise and fall depending on perceived regional insecurity issues and more recently West African ebola scares. The latter have badly affected American tourist traffic to Kenya. Many potential American tourists tend to be geographically unaware and view all of Africa as one entity.

The airline’s US$105m loss and operational shortcomings have led to a US$43m Government loan. As above, the price paid for this in terms of government involvement/interference could be high. It is not a good development.

National Airways (Ethiopia) .This is a proposed start-up dependent on the anticipated liberalization of air services. Two EMB145s are mentioned as the initial fleet.

Precision Air (Tanzania) has added Tabora, with a new tarmac runway, as a 10^th domestic point.  With an ATR fleet incapable of competing effectively with Fastjet’s A319 fleet, Precision’s business model now sensibly focuses on domestic airports too small for the jet. Located in the centre of Tanzania, Tabora has a long aviation history. It was an en route point on Imperial Airways UK-South Africa landplane services before WW2, and on Sabena’s weekly DC 3 service from the Congo to Dar es Salaam in the 1950s.

Rwandair is benefitting from Airbus’ ability to give early delivery slots for current model A330s as it tries not to wind down ahead of new A330neo production.  An MoU has been signed with Airbus for two to be delivered late in 2016.

SouthEast Airlines (Kenya), a low cost carrier, has ceased operations. Flying since late 2014 with a single CRJ100 just a once per day on the Nairobi-Mombasa route it was no competitive match for Kenya Airways baby JamboJet with its multiple frequencies and greater resources.

2.  SOUTH / CENTRAL AFRICA

Air Botswana. A new 5 year plan calls for fleet renewal involving jets and turbo-props with capacity up to 100 seats. The current fleet is 2 RJ85s, 3 ATR42-500s and a single ATR72-500. The airline, like many others of its size and restricted opportunities continues to struggle to define what it should really be and do.

Air Cemac. Shareholder governments have abandoned the project. Like several others in former Air Afrique federal carrier territory it was originally conceived to take over part of the multi country airline’s network,- in this case in French Central Africa which is a much more northerly area that the one called Central Africa by the colonial British. The allocated funds of US$17m have been exhausted to no avail.

Air Namibia. State cash provision will continue beyond the 2014 ‘Turnaround Strategy’ 2016/17 deadline. The 3 year Government budget provides US$163m of “support”. That would be called “life support” in the health industry .The question will still remain as to how it can be genuinely viable beyond that time. If nationalistic politics could be pushed aside, it would be talking to Air Botswana.

Air Zimbabwe is forecasting US$80m revenue for 2015, up by 120%, as its nominal ‘turnround strategy’ unfolds.  This unfolding hasn’t though yet secured the release of two A320s which continue to be held by SAA Technic pending payment of maintenance bills.
The Minister of Transport, Obert Mpofu, says the airline requires three small jets, plus two 737-500s,(cheap to buy but its low capacity pushes up its seat mile cost) and two B787s.The total  cost of US$770m plus US$298m to service debts in order to re-establish itself and become viable is the problem . The Minister admits that “it is not conceivable that Government can inject the required capital” but what strategic investor is going to want to take on responsibility  and the interest payments hanging over from historic debts?  The airline has in the distant past been be profitable. It is more fortunate than Air Botswana in that its core long haul route to London can work especially with the low capacity, low seat mile cost B787-8 or even for the time being two high quality fully refurbished B767-300s if they could be found. The same probably applies to Air Namibia’s Windhoek-Frankfurt route. Again time for some real cross border thinking and talking?

Comair as previously reported the company was the successful bidder for the St Helena Government tender so will operate between Johannesburg and St Helena with B737-800 when the new airport opens early in 2016. This is a 7 year deal. The franchised BA brand will be used. It is also reported that an airline calling itself Atlantic Star will operate “charter” flights to Britain.

Congo Airways (DRC), this new national carrier whose AOC issue is pending is expecting the delivery of two A320s and a Q400 for a 30 June launch of services based on Kinshasa and Goma.  Air France Consulting is providing assistance .

EC Air (Congo Brazzaville) has a leased B757-200 was seized in Paris by a Congolese businessman claiming outstanding government payments but subsequently released. Presumably a cheque arrived.

EC Air will launch twice weekly Brazzaville-Beirut B757 services on 3^rd June. This complements existing Paris and Dubai B757 longer haul routes.

flyafrica.com (Namibia) has received a Foreign Carrier permit from Namibia’s CAA and plans to start up using two 737-500s from Windhoek to Johannesburg and to Cape Town. 

flyafrica.com (South Africa) is indicating Mozambique, Malawi, and Gabon together with Benin and Chad as target bases in addition to its existing one in Zimbabwe. Approvals for Namibia and Zambia services to/from Johannesburg remain pending.

Korongo Airlines (DRC) This 2012 joint venture Brussels Airlines/DRC Govt /Congolese private investors is seeking additional capital. The single B737-300 serves only Kinshasa-Mbuji Mayi and Johannesburg.

Malawian Airlines is planning to add a leased 30 seat aircraft in June to its fleet in June so as to expand domestics services to include Mzuzu, Karonga and Likoma Island and to reduce capacity on the thin Mozambique routes to Tete, Beira and Nampula for which the current Q400 is too big.

Unfortunately the addition of another solo aircraft type makes the operation look even more like its predecessor the now defunct Air Malawi. Planned for July are  routes from Lilongwe to Nairobi and Victoria Falls.

Proflight (Zambia) aims to fly Lusaka-Busanga (Kafue National Park) twice weekly from July using a J41.

SAA Final revisions to the 2013 Long Term Turnround Strategy are to be completed by 30 April. Then should follow a revived push on implimentation. If it doesn’t, the temporary CEO could be very temporary. The Interim Board’s approved life has been extended for 6 months pending the appointment of a new full-time successor.

To add to its woes the airline now faces a US$ 82m claim that it was responsible for the 1999 collapse of Sun Air.

The suspended CEO Monwabisi Kalawe has agreed to US$230K package in exchange for his resignation.

The airline has pledged a three year total US$840m procurement spend within the local black business community.  Clearly acknowledging some fears, the Deputy Minister of Trade and Industry has given assurances that “this will not be an opportunity for corrupt deals”.

As part of a plan to strengthen its US and West African services SAA is to substitute Accra for Dakar on the Johannesburg-Washington route. It will have 5^th freedom rights beyond Accra on the thrice weekly A340-600s. To help with feed from West Africa a codeshare has been agreed with Ghanaian Africa World Airlines.  The thrice weekly Johannesburg to Dakar flights will continue but not proceed across the Atlantic.

3.  WEST AFRICA

Air Côte d’Ivoire has confirmed options for 2 new Q400s. This will bring the total in of this type in the fleet to 4.

Arik Air (Nigeria) is thinking about establishing a hub in Cotonou, connecting to nine regional destinations. 

The CRJ1000 has been launched on regional services. The fleet now includes 4 CRJ900s. 

Meanwhile the Dubai route has been suspended after just nine months. The Nigerian economy is blamed but competition from the Emirates and Etihad products is the most likely reality.

ASKY (Togo) is seeking US$50-60m investment to ‘strengthen operations’ on its West/Central African network. A further 4 B737-800s are envisaged over the next 5 years.  Johannesburg and Beirut services are planned for later this year.

Things appear less than happy in the Head office though. CEO Yissehak Tewolde appointed by 40% shareholder, Ethiopian Airlines, has resigned suddenly for ‘personal reasons’. Henok Teffera the new appointee was previously Ethiopian Head of Strategy and Alliances. The 5 year Ethiopian management contract expired in January and there has been silence about its renewal.

Camair-Co has taken delivery of the second and third out of three 3 MA60s ordered in 2012.

 More significantly the carrier also acquire additional jet aircraft: a B767 for the route and 3 B737-300/400s to expand regional flying. The reported current operating loss is US$2.5 a month.

Discovery Air (Nigeria) anticipates getting its AOC back after a “Financial Health Audit”. This follows a 3 months suspension.

Goldstar Airlines (Ghana) This start-up has leased a MD-11, B747-300 and a B767-300 but still awaits the granting of an AOC. The fleet choice looks unusual, unpromising even.

Senegal Airlines. Escalating debt, now US$75m, has prompted Government (36% shareholder) to target early privatization but who would buy? Short term action includes a 40% staff cut to 140 plus a 40% pay cut. The current fleet is a single A320-200 and a Q400.

4.  NORTH AFRICA

Afriqiyah has leased 2 A330s to Turkish Airlines.

Air Algerie has taken delivery of the first of three A330-200s.The airline is to increase its fleet by 16 aircraft to 59 by the end of 2016 with regional route expansion supporting a planned long haul route to New York. 

Royal Air Maroc launched ATR72 hops across the water from both Tangier and Casablanca to Gibraltar on 29^th March.

The next move is hoped to be E190 services to Praia via Isla do Sal. Beyond that a joint venture with Qatar Airways is planned with codeshares opening a wide network eastwards from Doha. The North African carrier will fly thrice weekly B787s between Casablanca and Doha alongside Qatar’s daily offerings. Plans for a direct route to Beijing will be dropped. Membership of Oneworld, of which Qatar is a member, is now favoured over Star Alliance.

5.  NON-AFRICAN AIRLINES

Air China will launch thrice weekly Beijing to Johannesburg B777-300 schedules from June. They replace SAA who abandoned the route on 28^th March as part of its Turnaround Strategy.  

Air France is bringing Freetown back online three times a week from 30^th June.

China Southern is aiming to launch Guangzhou – Nairobi flights this summer. Another headache for Kenya Airways.

Fly Dubai. June sees Zanzibar frequency doubled from two to four weekly. Juba and Bujumbura are also to get increased capacity. Although related to Emirates, the two airlines operate entirely separately, each with its own staff and equipment. Connections between FlyDubai and other carriers at Dubai are not easy. Fly Dubai operates from the Low Cost terminal on the eastern side of the airport whereas Emirates and virtually all other airlines fly from the glitzy terminals on the west side. FlyDubai focuses primarily on point to point business and offers a low cost product.

Lufthansa is to re-enter the Kenya market after a long absence with a winter only A340-300 service to Nairobi. Until the advent of the 747-400 in the 1990s Nairobi was an essential daily technical call on most European carriers’ routes to Johannesburg. Once that was no longer needed Lufthansa flew nonstop to both Johannesburg and Nairobi, using A300/310s  for the latter. The loads though didn’t justify continuing the route so the Kenyan capital was dropped from the network and the beach holiday traffic to Mombasa was served direct by Condor and other tour operator charters.

Generally seasonal services to Nairobi have aimed at the summer European tourist trade. This one, which does not overlap with the Serengeti/Mara animal mass migration appears to target the winter business and coastal leisure markets. The latter requires a seamless international to Mombasa domestic connection at Nairobi and this would require full co-operation from Kenya Airways and the Kenya Airports Authority. Even for Kenya Airways own connecting passengers it has been a sore point for decades. Having to push a baggage trolley across a busy and poorly lit road is nobody’s definition of seamless.

Qatar Airways is on track to launch a five times weekly Doha-Kilimanjaro-Zanzibar-Doha triangle A320 in June.

Turkish Airlines continued its African expansion in May with a Istanbul-Ougadougou-Bamako B737-900 route. Next addition will be the extension of some Johannesburg services to Maputo in October.

6.  MISCELLANEOUS

Burundi: Kenya Airways, Brussels Airlines and Rwandair temporarily suspended  lights to Bujumbura after a military coup attempt.

Chad’s Government is looking at replacing its single B737-300 carrier Tournai Air Chad with a new national carrier. It isn’t clear how they propose to improve its fortunes. Staff cuts and allied cost reductions perhaps?

Côte d’Ivoire has received its ‘US Transport Security Administration’ approval’ for direct USA flights from Abidjan.

South Africa The High Court has rejected a case lodged by Comair that the regular ‘state guarantees’ given to SAA are in fact subsidies to avoid liquidation, things which would need full parliamentary approvals.  They unsuccessfully asked for Government’s recent action to be declared unconstitutional and unlawful. The outcome was perhaps predictable although Comair must have thought the cost of the case worth a try even if only as a warning shot to try to at least limit similar assistance to the future. When the chips are down the Government is unlikely to let SAA go out of business in almost any circumstances.

John Williams

31 May 2015

Aer Lingus banks towards IAG's ( and Qatar's?) flypaper.

The Irish Government has thrown in the towel on its 25.1%% share in Aer Lingus. It is prepared to sell out to IAG at 2.55 Euro a go. That will just leave a decision by RyanAir on its 29.8%% to come.

Ironically if Ryan do sell they become de facto Ireland's national carrier.

The deal comes with guarantees to the Irish Government that the key network structure of the high frequency London route and the use of Dublin as a trans Atlantic hub will continue for at least seven years and that Aer Lingus will remain a standalone brand in the same way as are BA, Iberia and Vuelling. Seven years is not a long time so while that is a short term comfort it gives no long term guarantees. Anything could  happen after that.

IAG's purchase follows its previous pattern of interests in geographical areas of which Chief Executive Willie Walsh has previous experience. It also continues the policy, other than in the case of Vuelling, of buying legacy carriers whose potential profits come from squeezing out inefficiencies and ancient working practices rather than necessarily route and revenue growth. The threat to any recalcitrants is that Vuelling can over time take over their short haul routes.  Indeed one can forsee Vuelling progressively becoming the operator of all the group's short haul network ,possibly on a pseudo franchise or codeshare basis, anyway.

Further afield IAG has been unsuccessful in persuading Boards to sell them their businesses. A very significant relationship has though developed with the extremely seductive Qatar Airways who recently purchased 10% of IAG in a move explained by its Chief Executive  as representing "an excellent opportunity to develop our westwards strategy". Here comes another development ? Qatar Airways (note the airline not the state per se)  would logically be interested in owning a higher percentage although the total of all non EU holdings is limited to under 50%.  Alone among the Europeans Walsh has recently come out fighting against USA and Europe moves to clip the wings of the Gulf carriers. Could we now be looking at a scenario where IAG finances the purchase of Aer Lingus by increasing its share capital via the issue and sale of additionally created stock to Qatar Airways? Even if it doesn't happen now this sort of progression has to be a long term strategic possibility with very deep and interesting implications.

Dutch Poacher turns Gamekeeper.

Ever since 1948 KLM, backed by the Netherlands Government and in close co-operation with Amsterdam's Schipol Airport specifically designed for connecting traffic, has punched above its weight in the world. This is largely thanks to a superbly conceived and executed policy based on sixth freedom business gained through generous bilaterals. Amsterdam's single terminal ,easy to use, home hub has been developed and constantly updated. It has almost uniquely over 60 years kept ahead of actual demand and has as result always been Europe's airport of choice for many travellers. As a bonus, being able to offer international to international connections to the UK has given it an enormous advantage over British based airlines in extracting business from the UK provinces. The recipe was simple. KLM established a comprehensive long haul network fed by short haul spokes to the widest possible range of European and UK secondary cities. It was the prototype model of how to play the international hubbing game. Nobody did it better. With airline, Government and airport authority working hand in hand Amsterdam and KLM have been brilliantly successful in pulling business away from other people's home hubs. All this has required substantial Netherlands Government support in numerous ways including financial.

That's fair enough in the tough rough and tumble world of competition but what if someone else, better placed maybe and with bigger resources comes along and gets even better at it? Seemingly in the Hague that doesn't look so fair.

In response to the avalanche of new  high quality competition the Dutch government,- ironically just days ahead of receiving Qatar Airways' first Amsterdam service, - has said " Enough is enough"  The allegedly "subsidised Gulf airlines are deemed guilty of "unfair competition and will get no more new traffic rights. Maybe the vision of  Milan- New York (Emirates) lookalikes out of out of Amsterdam
is too much to bear.

This is a breathtaking about face by one of the original high priests of the open skies philosophy. Where is that now,-or was that only for an era in which there were no significant challengers?  The whole affair smacks of sanctimonious hypocrisy as do the bleatings on the same subject from the American legacy carriers and Air France and Lufthansa. The subsidy issue, which could be debated for years depending on numerous possible interpretations, is unproven and differs between the three Gulf contenders who also rightly see their accusers as pots calling kettles black. They argue that European and US airlines have from the outset built their own business upon a host of governmental and domestic benefits and arrangements. It can hardly be seen as fair game for a country which has thrived on these and been the master of the sixth freedom business since 1948 to now pull up the ladder.

The geography of many international traffic flows has in any case changed dramatically over the last few years. This is partly down to investment by the Gulf states followed by Turkey and partly to the ever increasing range of long haul aircraft, particularly the big twins with ETOPS clearance stretched way beyond anything foreseen 20 years ago. That has put the Gulf within nonstop range of almost anywhere.

This is not the time for the European or US governments to head for the defensive bunkers. Fingers in Dutch dykes are no answer.  Our consistent view is that the governments must tell their airlines to get out there and compete or take the consequences. That's business.

Oriental Flavours

Some things change quickly,others less so. Terminals around the world have grown and become attractive places, with more space, light and facilities. Some of the things that go on inside and the thinking behind them haven't kept up with the pace.

Arriving at Siem Riep in Cambodia passengers enter a brand new modern building with an attractive temple-style roof. It's a great leap forward. Unfortunately the immigration department could only manage a short hop. At one end of an impressive long counter the newly arrived hand over $30 for a visa. At the other end it is handed back, having been handled by thirteen officials. For the 50 passengers off a Vietnam Airlines ATR 72 it's a slow process. For a full A321 or larger it would be a nightmare.

The ATR  on which we travelled had departed from Da Nang in Vietnam where the aircraft "stop" markings are ahead of the game, with the A350 clearly marked. Just to make sure nothing's missed out, new lines have also been painted for the TU-134 and DC-10. Both unlikely ever to visit again. It does though indicate a time span of 50 or more years.

A bit further north, Hanoi also has a brand new 1 km long terminal opened in January. Visitors from the 1990s will remember a huge and largely empty open ramp and it being perhaps the only place in the world which followed the original Boeing 747 operating manual which specified three open doors and three sets of passenger stairs.Visitors from the 1990s will also remember the highway into town which started off well suddenly became something like a cart track leading to a rickety substitute for the bridge, the definitive one not having been built yet. Now it's all there and the highway sweeps across the Red River. It's all a Japanese project. Far from being empty the new terminal and ramp see 900 scheduled services a week by 34 carriers. The spinal trunk route to Ho Chi Minh City accounts for 270 of these. It is all  a reminder of the sheer volume of traffic flows within the region of which industry observers in Europe and the USA are often unaware.

The number of regional Low Cost Carriers also takes the uninitiated by surprise. South East Asia has seen a mushrooming of 22 from Indonesia in the south to Vietnam in the north, with three or four competing on some city pairs. Unsurprisingly over-capacity is common and profitability difficult but as in Europe these carriers are making air travel a realistic option for many new travellers . Once hooked they are reluctant to go back to the buses. Air Asia, now with 200 aircraft is one of only ten carriers worldwide to have carried 50 million passengers in a year. Who would have dreamed that 20 years ago? 

The quietest country in the region is Laos. Its capital Vientiane also boasts a new terminal. Lao Airlines operates a small fleet of A320s and ATR 72s while the distant corners of the ramp are home to a few Chinese built MA61s and Let410s, neither customer favourites. Two retired Lao Airlines AN 24s also lurk there but gone is the Royal Air Lao Viscount of years ago.

Bangkok's huge glitzy Suvaranabhumi Airport is impressive externally and, on first sight internally although the use of some rather dark local materials makes some areas rather dark and oppressive. Be ready for some very long walks indeed  and don't book tight connections. Strangely it also displays a few retired aircraft including A330s which would be more appropriately housed at the old but slowly re-emerging Don Muang Airport. Thai, owner of almost every variant of every type of airliner available, is slowly rationalising and restructuring in response to new international competition and to the local Low Cost Carriers, Bangkok Airlines, Thai Air Asia and Nok Air. Hence its contribution to the static park. Whatever Thai's problems though, its customer service style is something that most legacy western carriers can only dream of. Its catering in all classes is good and attractive too.

And there's the rub. Wherever one goes on nearly every Asian airline the service ethic and delivery is good and that's not because they are all soft people. Just look at their history. They are not. Many have had very tough backgrounds and still do. No doubt there are bad days for everyone but they don't show it. The Singapore Girl theme so brilliantly introduced by Singapore Airlines in the 1970s stands in the background to all the newcomers' offerings. Bangkok Airlines is outstanding for smart customer friendly staff who seem to be genuinely enjoying doing their job .The ethic is there everywhere and they are a pleasure to fly with. A lot goes into selection ,recruitment, training , keeping everything and everyone refreshed and looking forward. Not all of the newcomers will succeed. Several of  the original  of Asian "national" carriers who swept all before them now teeter on the brink of being labelled "legacy". We will come back to that theme but for now even those seen in Asia as less good are servicewise very good by European or US standards.

 Some of Asia's official world needs to catch up and understand that it too is in the business of serving people. That's less easy when people have signed up as part of a "border force","immigration authority" and that sort of thing. They aren't so keen on having their rubber stamps, threat of handcuffs etc taken away. Asia isn't the only place that hasn't cracked it yet though.


-John Williams-