African car­ri­ers post growth de­spite tur­bu­lent times

The East African - - NEWS -

By NJIRAINI MUCHIRA

AFRICAN AIR­LINES posted an im­pres­sive growth in pas­sen­ger traf­fic in Novem­ber 2018, de­spite a tur­bu­lent busi­ness en­vi­ron­ment.

Data from the In­ter­na­tional Air Trans­port As­so­ci­a­tion (IATA) shows that African car­ri­ers recorded a 5.7 per cent in­crease in pas­sen­ger de­mand, over the same pe­riod in 2017.

The per­for­mance, how­ever, rep­re­sented a de­cline from Oc­to­ber, when the in­dus­try posted 6.4 per cent growth. In Novem­ber, ca­pac­ity rose by 3.9 per cent and load fac­tor rose 1.2 per­cent­age points to 68.9 per cent.

Pas­sen­ger traf­fic growth in Africa is be­ing re­alised de­spite the eco­nomic chal­lenges facing the con­ti­nent’s largest economies, Nige­ria and South Africa, and the fact that many African car­ri­ers are strug­gling to re­main air­borne.

Apart from Ethiopian Air­lines, which is fly­ing high in terms of pas­sen­ger num­bers and prof­itabil­ity, other car­ri­ers are stalling due to chal­lenges like high taxes, air­fare and cost of jet fuel, poor air­port in­fra­struc­ture, in­ter­na­tional com­pe­ti­tion and un­favourable poli­cies.

This has seen Africa’s con­tri­bu­tion to the global avi­a­tion sec­tor re­main low with the con­ti­nent cur­rently ac­count­ing for only 2.2 per cent of the global air­line pas­sen­ger mar­ket.

IATA projects that African car­ri­ers will post a $300 mil­lion net loss in 2019 (slightly im­proved from the $400 mil­lion net loss in 2018), mak­ing Africa the weak­est re­gion, as it has been over the past four years.

On the global front, the avi­a­tion in­dus­try recorded healthy but mod­er­ate pas­sen­ger traf­fic in Novem­ber. To­tal rev­enue pas­sen­ger kilo­me­tres (RPKS) rose to 6.2 per cent, from 6.3 per cent in Oc­to­ber. Ca­pac­ity (avail­able seat kilo­me­tres) in­creased by 6.8 per cent, and load fac­tor dipped 0.4 per cent to 80 per cent. It was the third time in two years that load fac­tor fell on a year-to-year ba­sis.

“Traf­fic is solid. But there are clear signs that growth is mod­er­at­ing in line with the slow­ing global econ­omy. We still ex­pect 6 per cent de­mand growth this year. But trade ten­sions, pro­tec­tive tar­iffs and Brexit are all un­cer­tain­ties that over­hang the in­dus­try,” said Alexan­dre de Ju­niac, IATA’S direc­tor-gen­eral.

Ac­cord­ing to IATA, in­ter­na­tional pas­sen­ger de­mand rose by 6.6 per cent in Novem­ber, up from 6.2 per cent in Oc­to­ber.

Pic­ture: File

Ethiopian Air­lines is fly­ing high in terms of pas­sen­ger num­bers and prof­itabil­ity.

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