#UgandaAirlines CEO in dialogue with ATCNews

THE FUTURE OF UGANDA AIRLINES REMAINS BRIGHT SAYS CEO CORNWELL MULEYA

(Posted 15th May 2020)

ATCNews recently discussed the future of Africa’s youngest national airline with CEO Cornwell Muleya.
Cornwell Muleya, formerly CEO of ALS in Nairobi / Kenya and then CEO of Air Uganda – an airline he turned around before it fell victim to the machinations of the CAA at the time – has the experience and the required skills to run an airline, that is beyond doubt. Muleya in the past also served in CFO and CEO capacities for such other carriers like Air Mauritius, Air Botswana and Arik Air, in other words is no novice to the industry and well versed in both challenges and opportunities for African airlines.While the airline is presently grounded following a government decision to halt passenger air transport in and out of Uganda, apart from specially approved humanitarian and repatriation flights, will operations gear up again once the prohibition order has been lifted and it is safe to resume operations into regional capitals.
Given that the airline was only in the air around 8 months when the Corona pandemic also struck Africa in general and Uganda in particular, will the restart be more or less similar to the original launch, likely to start with one destination and then eventually expanding the network, including the already announced destinations Johannesburg and Kinshasa.

Q. By early March Uganda Airlines had operated for about 6 months. How far did the airlinego during the half year in comparison with projections and forecasts.

 We are very pleased with the first 6 months as far as getting our identity and branding knownto the markets. We have managed to put both the airline and the country on the mapworldwide, which is a big achievement for a start-up airline.
 Operationally we have also done well and have flown over 68,000 passengers across the 8 destinations we were operating. We are slightly below our targets for this period by margins of less than ten percent which is good growth given the circumstances.
 More fundamentally, we have become well known for service quality in terms of punctuality, reliability, the quality of the aircraft cabin and seats, as well as excellent customer service on the ground and on-board our aircraft.
 We were looking forward to opening more regional routes when the pandemic hit us.
 All in all, it has been a good six months for Uganda Airlines where we have seen our brand rise from nothing, to become one of the leading airline brands in our region and across the industry

Q. At that time, Uganda Airlines had already announced the launch of Johannesburg and Kinshasa as two new routes over and above Nairobi, Mombasa, Mogadishu, Juba, Kilimanjaro, Dar es Salaam and Zanzibar. With a fleet of four CRJ900s how far can a route and frequency expansion go before you require additional aircraft?

 All of the regional routes we plan to open can be successfully operated by our current fleet of 4 CRJ900 aircraft.
 The intercontinental routes to be opened in early 2021 will require a different aircraft type from a range and payload perspective, and our business plan already includes the purchase of two A330-800neo aircraft for this purpose.

Q. What route would you name as your best performing destination and what challenges did some other destinations pose for the airline?

 When you are still in the start up phase, you focus on building an interconnected network of routes to allow you to bring and redistribute traffic out of your hub. In this phase, all of the routes are important from a network basis otherwise the hub structure will not work.
 It is only after the route structure has matured that you can start to look at how frequencies may be adjusted to suit traffic densities and connections across the hub.
 Currently it is too early to analyse performance in this way.

Q. Uganda Airlines is planning to go international by early 2021 with two new Airbus A330- 800neo. What destinations and how many frequencies is the airline eyeing for the launch of long haul flights?

 The key destinations where traffic is going out of Uganda are UAE (Dubai), China (Guangzhou) and the United Kingdom(London)
 The Dubai route has the highest potential and we expect to operate near daily frequencies
 London and Guangzhou will be a few services per week initially.

Q. The travel trade across much of your network but certainly Uganda, Kenya and Tanzania are looking for Uganda Airlines to launch packages. i.e. flight and hotels, perhaps even inclusive destination transfers which can be purchased through your sales outlets. How far have you taken this to start generating revenues?

 We are working on all of these products as part of our strategy to be visible and distributed everywhere. Currently we are working with the hotel associations, travel agents, tour operators and tourism boards to coordinate the packaging structures and to ensure there is affiliate marketing across all partner platforms.
 Unfortunately, this takes time to organise but soon customers will begin to see wide marketing of these items on several digital media platforms accordingly.
 For now, we are already selling flight and hotel packages from our sales outlets to several points including Mombasa, Zanzibar and Kilimanjaro out of Entebbe

Q. Many international airlines coming to Entebbe are no doubt keen to talking with you about interlining or even code share on your regional network. At the same time do most of these airlines insist on their new partners first accomplishing IOSA certification. No doubt have you already started this process and when do you expect to complete the required audit and become
certified?

 You are very right because we have a comprehensive interline and codeshare strategy which is non discriminatory to potential partners. So far we have discussed with many of the major carriers in our region and in the Middle East and the talks have been very positive.
 We have also started working on our IOSA certification project which as you point out is required for full interlines and codeshares with the IATA member airlines. We expect to complete these important steps in 12 months’ time.

Q. Which memberships, such as IATA, AFRAA and related bodies has Uganda Airlines taken up so far?

 Uganda Airlines is already an associate member of AFRAA and has signed up to join many IATA structures including the Clearing House and the IATA BSP to allow it to operate as a commercial airline
 Full membership of IATA and AFRAA will be pursued when the IOSA accreditation is attained since it is a pre-requisite for membership of these bodies

Q. Will joining an international alliance be part of Uganda Airlines future plans?

History has shown that the aviation business is interconnected worldwide and there are many benefits to working with several partners across the world.
 Airline Alliances offer opportunities to lower costs through shared services and facilities and Uganda Airlines will certainly pursue those opportunities in the future

Q. As Entebbe’s predominant airline in regard to the number of flights performed, Is the Uganda Civil Aviation Authority, which is the manager of the airport, giving Uganda’s national airline any preferential treatment in regard to landing fees, parking fees and related operating expenses?

 Entebbe is our home base indeed and we are the airline that has the most departures and arrivals at this airport. For this reason, there is opportunity for discussions with the Airport Authorities with regard to volume based pricing as is the case at all airports across the world. We work progressively with the Airport Authority on this.
 Airport operations are governed by ICAO principles which require non-discriminatory pricing for all carriers and this is the case here at Entebbe airport. However, it is true to say that our authorities have welcomed Uganda Airlines with open arms and are doing everything possible to help us to succeed.

Q. Given the recent developments vis a vis COVID19 and the flight ban by the Uganda government, where did that leave Uganda Airlines in regard to forward planning and will it affect the delivery dates of the two Airbus aircraft?

 The Covi19 issue was a big blow to the aviation industry worldwide and the economies of all countries.
 For Uganda Airlines, it means we have to launch our routes once again and then start to rebuild the network we have planned in keeping with the Business Plan. The only difference this time around is that our brand name and reputation is already known in the market unlike before
 So far we still expect to receive the two A330-800neo aircraft at the end of this year as planned to allow for launch of overseas routes early in 2021. The market disruption is expected to present new opportunities on selected routes which we hope to take advantage of.
 However, the extensive disruption to the industry and the uncertainty of when markets will open means we have to continue working on several alternative scenarios

Q. After the halt of flights, what is the situation of the Uganda Airlines staff in Kampala, Entebbe and the stations in the region?

 One of our key priorities is to look after our staff because we will need them to achieve the recovery we need for the airline. Our initial assessment was that the markets may begin to open after a 3 month period and for this reason we have not made drastic changes to staffing levels
 We have simply readjusted our work methods and procedures to ensure remote working practices, online meetings and social distancing measures while making sure that delivery of key projects does not suffer.
 In addition, we were still on the set up phases of the airline at the time of the airport closures and therefore were still recruiting staff in several areas including crew for the new fleet of aircraft still expected to come later this year. The question now is the timing of these measures so as to contain costs and preserve our liquidity.

Q. When the ban is eventually lifted and flights can be safely conducted again without further fear of infections for passengers and crews, how fast will you be out of the starting blocks to resume full operations as was the case before the halt of flights?

 From a fleet perspective, our aircraft are on a preservation maintenance program and can be activated for full flight readiness within a period of 24 hours.
 The challenge is to ensure operational readiness by all service providers here at home and at all destination airports where we intend to fly
 Your must understand that some service providers may have gone bankrupt or may have scaled down their operations and therefore will require time to ramp up capacity in order to handle airline flights after opening of these airports.

Q. What is your personal goal of the airline over the next say five years?

 I see Uganda Airlines as having the potential to grow into a first class regional and international player given its broad vision, home market, geographical positioning and support it has from the shareholders.
 The initial five years must lay the foundation for commitment to good governance principles, professionalism and service excellence in order to achieve this vision and to provide the connectivity required to support Uganda’s economy and its people. My goal is to lay the building blocks for such a firm foundation for the carrier.

ATCNews thanks Mr. Cornwell Muleya for his readiness to respond to our question and wishes him, the airline as such and all the staff the very best in the weeks ahead before taking to the skies again.

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