Ethiopian, Rwandan and Dar carriers to grow seats, but will demand rise fast enough?
Regional airlines are sprucing up their fleets with new aeroplanes. Ethiopian, Rwandan and Tanzanian airlines will receive new aircraft from next week.
Tanzania plans to have its Air Tanzania Company Ltd (ATCL) return to its regional routes.
“The government is working on a strategic three-year plan that will see the airline’s fleet revamped. If the discussions come to fruition, Air Tanzania will get two more aircraft from Bombardier in the coming year,” a senior aviation official in Tanzania’s Transport Ministry said.
Air Tanzania is majority-owned by the state, but has only one Bombardier Dash 8 and a leased Canadair CRJ 100s, which operates between Dar es Salaam and the Comoros islands, with local routes to Mwanza, Kigoma and Mtwara.
Last week, Bombardier Commercial Aircraft announced that Tanzania had signed a $62 million purchase agreement for two Q400 turboprop airliners.
Leonard Chamuriho, Permanent Secretary at Tanzania’s Ministry of Transport, Works and Communication, said the Q400 aircraft will provide affordable, convenient and comfortable air transport.
“We are committed to providing good service as our business grows to include new destinations in Tanzania and Africa,” Dr Chamuriho said.
The aircraft were reportedly purchased after a $20 million loan was processed through the TIB Development Bank.
The EastAfrican understands that ATCL has been audited to ensure the company is financially sound. The airline is said to generate $2.8 million monthly, but has been saddled with debts.
Last month, Ethiopian Airlines became the first African airline to take delivery of the Airbus A350, in a $2 billion deal that included smaller aircraft. The aeroplane flies on the Addis Ababa to Lagos route, and has also served the Kigali and Entebbe routes; the route is also served by Kenya Airways and RwandAir.
Tewolde Gebremariam, group chief executive officer of Ethiopian, said the aircraft had been purchased to stay competitive in the region.
“We are taking an aircraft that has cutting edge technology and will be 25 per cent more fuel efficient. We will save on costs while providing comfort,” he said.
RwandAir is expecting two Airbus aeroplanes and a Boeing between September and November. The airline is expecting the delivery of its first 244-seat Airbus A330-200 in September, followed by a Boeing B737-800 in October, and a second 274-seat Airbus A330-300 in November. In May 2017, the airline will receive its fourth Boeing B737-800.
RwandAir will ply the Johannesburg, Entebbe, Dar es Salaam, Lagos and Accra routes. The aeroplanes will also operate on the long haul routes to Europe and Asia. The airlines’ most lucrative routes are Kigali to Entebbe, Juba, and Nairobi.
However, analysts are sceptical about whether demand for air travel in the region is high enough to sustain the fleet expansion programmes.
“Even large international airlines have had tumultuous times running a profitable business in the region. It is difficult to foresee a scenario where passenger demand will rise,” said Razia Khan, chief Africa economist at Standard Chartered Bank.