Is a new ‘threesome’ of African airlines in the making?

KENYA AIRWAYS – SOUTH AFRICAN AIRWAYS – AIR MAURITIUS – A NEW PARTNERSHIP ON THE HORIZON?

(Posted 13th June 2018)

On the sidelines of #AviaDev2018 in Cape Town was some ‘buzz’ felt over suggestions that two of Africa’s big loss making airlines, Kenya Airways and South African Airways, may be seeking to join hands with Air Mauritius, which has returned to profitability two years ago after years of sustained losses.
Who would learn what from whom remains an open question and pundits at AviaDev remained divided over the benefits of such a cooperation when at least two of the three should be focusing on returning swiftly to profitability – something which in the case of SAA seems years away.
In South Africa are plans afoot to integrate several SAA offspring companies into the fold and bring Mango – the only consistently profitable airline in that group – South African Airlink and SA Express all under one roof.
This however does not address the need to shed staff and while the South African government has just injected yet more money into the airline, will it remain to be seen if that will be enough or if the drain on national financial coffers will continue.
In Kenya has progress been made under CEO Sebastian Mikosz but KQ’s return to profitability depends on many factors, labour and pilot union goodwill being one of them and continued tourism recovery being another factor, both beyond the managements own doing.
Air Mauritius has returned to profitability after some painful cuts in destinations and other cost centres but continued profitability remains a challenge here too.
As aviation fuel prices are on the rise again – AFRAA did not respond in a timely manner to the question where their own fuel project is at the moment – are global airlines once again eying fuel hedging deals, but it is here that Kenya Airways had last time they did got it awfully wrong and were as a result bleeding money with every gallon of fuel they pumped into the tanks of their aircraft.
If an alliance of three airlines could make a difference in securing lower purchasing prices on fuel and in other areas is a matter of debate, and the next two days here in Cape Town will no doubt bring more insights to light, but the fact remains that under the umbrella of AFRAA this could be accomplished without having to create another ‘vehicle‘ or ‘platform‘ to accomplish that.
Fodder for though no doubt and for sure something to keep an eye on.

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