(Posted 18th September 2024)
After witnessing rapid growth over the past five years – apart from the pandemic enforced downtime – Uganda Airlines is presently weighing options for the next phase of its fleet development. Starting with four CRJ900s in August 2019, the airline then took delivery of two A330Neos in December 2020 and February 2021. The 76-seat CRJ900’s were designed to support the initial ramp-up and establishment of the regional network which was to feed the upcoming medium and long-haul routes.
However, with the current route network consolidating and achieving critical mass, future growth will be premised on fleet optimisation to support expansion into new markets and maximising opportunities within the existing network.
To achieve these goals, the airline plans to double the number of aircraft in its fleet, from the current six to 13 by 2030. Uganda Airlines currently operates an owned fleet of four CRJ900LRs and two Airbus A330-800neos. In May, it added a leased Airbus A320-200, from South Africa-based lessor Global Airways.
The airline’s shareholders – the ministries of Works and Transport, and Finance and Economic Planning – have approved a plan for the acquisition of 7 additional aircraft. Uganda Airlines management has proposed to acquire 2 Boeing 787-800 Dreamliners to supplement the A330s in the long-haul fleet, 4 Airbus A320neos in the medium-haul fleet and a single Boeing 737-800 Freighter to launch a dedicated cargo operation.
Questions however remain as to why not add more Airbus A330Neo or even the Airbus A350, as they would offer the all important commonality – including with the A320Neos – vis a vis cockpit layout, operations, training and crew utilisation, something which may eventually lead to a rethinking of the decision to opt for a B787 – after all additional aircraft types and manufacturers ordinarily add extra cost to any airline’s operation. Besides, the problems encountered with the B787 deliveries and manufacturing challenges are just another reason to rethink the options for the acquisition of wide body aircraft.
The A320s will bridge the capacity gap between the 76-seat CRJs and 258-seat A330s while the 737 freighter will supplement the A330s to satisfy the demand for cargo uplift from the Middle East, India and Europe as well as across the Eastern African region. The first two A320s are required as early as mid 2025 while the last two, and the Dreamliners are expected for delivery in the 2029-30 period.
The fleet growth is designed to support the expansion of international operations over the next five years into destinations such as London in the United Kingdom, Guangzhou in China, Jeddah and Riyadh in Saudi Arabia, and additional points in western and southern Africa.
Additionally, the new aircraft will support frequency growth on existing routes such as Dubai, Mumbai, and Lagos. It will also give the airline flexibility in increasing seat capacity on regional routes as the traffic not just consolidates but continues to grow.
According to airline officials, the current fleet is approaching its limit in three key areas: the number of routes a single aircraft can be deployed to operate in 24 hours, the maximum distance the CRJs can fly with a full payload and restrictions to the ability to maximise opportunities in markets where frequency growth would be possible.
According to information sourced, internal simulations by the dispatch department indicate that the A330s which currently serve on the Dubai, Mumbai, and Lagos routes, can at most only accommodate two more sectors with a flight duration that does not exceed 8 hours. With the current route configuration, operating routes such as Guangzhou, with a flying time above 10 hours would not be possible.
The near-term plan is to get the A320s to be the primary aircraft for the Dubai and West African routes while the A330s will get deployed on the China, Europe, and India routes.
The proposed routes to Europe and Asia are supported by the fact that there is no existing direct service out of Uganda to any of the proposed destinations. Available data indicates that 84,000 people travelled between Uganda and London using indirect routes, in 2019. That translates into 1615 passengers a week or 230, daily. Uganda Airlines proposes to initially operate 3 flights a week to London Gatwick. Combined with connecting traffic from within its African network, London is a very promising destination.
The airline is also said to be studying the option of an EU waypoint enroute to London – at a later stage probably becoming a stand alone destination – with Frankfurt being an obvious choice: There are no direct flights from Germany to Uganda and the VFR, tourism and business travel segments constitute a very significant number of arrivals to Uganda. The flight routing in such a case would have to be EBB FRA LGW FRA EBB, as the UK would demand transit Visa for all passengers enroute to a European mainland destination, something another airline from the region had to find out the hard way some years ago when trying to route via LHR to BRU.
The return of Uganda Airlines to the market has been beneficial to the travelling public not only because it has increased Uganda’s connectivity to the wider region, across the continent and to the rest of the world, but because of moderating the cost of air travel. The added competition has driven down ticket prices, allowing travel at much more competitive rates.
Lease of Purchase?
Another consideration that is being debated internally, according to several sources, is whether to lease or purchase and own the new aircraft. With the existing fleet fully owned and unencumbered by debt, officials believe that the carrier’s current cash flow can support lease payments for up to three aircraft, perhaps every four.
Another reason in support of leasing is that delivery slots at both Airbus and Boeing are fully subscribed well into the 2030’s although some of these delivery slots are held by lessors which can make the aircraft available earlier than the timelines set for an outright purchase.
In fact, leasing my be the one viable option for the airline as reportedly the IMF has cautioned Uganda over added multi million US Dollar expenses for the purchase of more aircraft – yet they stand by idle as neighbouring countries pour billions of shillings into new aircraft purchases.
It also seems the the President of Uganda may have been swayed in his outspoken support for Uganda Airlines by the IMF as latest details available suggest that he has send the airline back to the drawing board.
ATCNews will continue to monitor the situaiton and report updates as and when available.
