Friday, 30 November 2012

How Fastjet is refining the LCC model for Africa

Fastjet, the new pan-African low-cost carrier (LCC) which launched operations in Tanzania this week, has a stated goal of "democratising" air travel on the continent by introducing affordable, reliable and safe no-frills flights. Rather than taking market share from existing regional carriers like Precision Air and Air Uganda, its business model has the grander aspiration of catalysing a regional LCC boom and enticing Africans away from road travel.

In pursuit of this goal, Fastjet has no qualms about adopting core LCC principles in its business model - charging passengers for non-essential, ancillary services such as baggage and on-board refreshments. But at the same time, it has identified areas where the European LCC model is not well suited to the African marketplace, necessitating some refinement. In the words of chief commercial officer Richard Bodin: "We have to adapt and mould the model to fit the environment, culture, market [and] distribution channels."

Wednesday, 7 November 2012

Interview: Nico Bezuidenhout, Mango CEO

Mango spies east African expansion within 12 months

Mango, the low-cost subsidiary of South African Airways (SAA), expects to launch its first regional services within 12 months, chief executive Nico Bezuidenhout tells Flightglobal. The domestic carrier has secured rights for Mauritius and is close to gaining access to Zanzibar, Tanzania.

It had been planning to increase its six-strong Boeing 737-800 fleet by two aircraft over the next year, but that figure will likely rise in the wake of rival 1time's demise.

Bezuidenhout says the launch of pan-African low-cost carrier FastJet has placed a "competitive necessity" on Mango to "more aggressively pursue regional expansion".

Thursday, 1 November 2012

Saudia privatisation

Full article in PDF format

When Saudi Arabia's Supreme Economic Council approved the plan to privatise flag carrier Saudia in 2006, no-one was expecting an overnight transformation of the 61-year-old flag carrier.

It had already taken six years to bring the roadmap before government, with His Royal Highness Prince Sultan Bin Abdul Aziz having inaugurated the first privatisation studies in 2000. The actual process of dividing Saudia into six private businesses – catering, cargo, ground handling, maintenance, training and the core airline unit – was destined to take many more years.

But notwithstanding several missed deadlines, steady progress has been made by the carrier. Its cargo, catering and ground handling units have all been part-privatised, while the maintenance and training units are due to join their ranks by the second quarter of 2013...

Kuwaiting time

Full article in PDF format

Kuwait's decision to suspend the privatisation process for its national carrier came as little surprise last year, with muted interest among bidders and more pressing concerns in the emirate's fractured parliamentary system.

But the subsequent grounding of three Kuwait Airways Corporation (KAC) aircraft in July – following an emergency landing by one of its Airbus A300s in Medina – underscores how time could be running out for the airline's ageing fleet.

Kuwait's most recent attempt to resurrect the privatisation bill came unstuck in June, when draft legislation provisionally approved by the Cabinet was swept aside with the rest of parliament. The Constitutional Court's move to invalidate February's election – which had seen significant gains by opposition Islamist parties – forces the emirate to once again go through the motions for new legislation...

Swimming with the big fish

Full article in JPG format:
page 28/29 & page 30

When RAK Airways re-launched in 2010 – having been grounded after just two years of operations – many in the aviation industry were sceptical of its pledge to carve a niche between the full-service and low-cost carrier sectors.

The saturated Gulf aviation market had already seen years of double-digit growth, with Dubai's Emirates Airlines and Abu Dhabi's Etihad Airways transforming the United Arab Emirates (UAE) into the world's pre-eminent intercontinental hub. On the lower end of the market, Sharjah-based Air Arabia and FlyDubai were fast hoovering up point-to-point traffic across the region.

But in the northernmost emirate of Ras Al Khaimah – where annual air passenger numbers of 328,000 pale in comparison to Dubai's 51 million – RAK Airways chief executive John Brayford is proving the naysayers wrong, charting an expansion strategy that complements rather than competes with his dominant neighbours to the south...

Air Baltic sets out on recovery road

Full article in PDF format

Rumours that the EU may instruct Latvia's Air Baltic to pay back up to €80 million ($104 million) in state aid are understandably of concern to chief executive Martin Gauss - not least given his memories of heading up Hungary's Malev, which went to the wall over €280 million of EU debt.

But Gauss has form for turning around European carriers - having sold DBA, formerly Deutsche BA, to Air Berlin in 2006 - and his 'ReShape' plan at Air Baltic is already beginning to show signs of progress.

The former Boeing 737 pilot took up his position in Riga in November 2011. His appointment followed a bitter dispute between the Latvian government and previous chief executive Bertolt Flick, whose offshore investment vehicle subsequently sold its 47.2% stake in Air Baltic back to the state...