Luxair is the national carrier of Luxembourg, a wealthy country in the heart of Europe that is known for its international financial market and as well as for being one of four cities hosting European Union institutions alongside Brussels, Frankfurt and Strasbourg.
For many years, the carrier has focussed on operating with small capacity and high fares but has been forced to adapt its strategy due to changes in the European airline market. ch-aviation´s Thomas Jaeger had a quick chat with Martin Isler about ongoing changes and challenges. Isler, who is Swiss like Jaeger, is Luxair’s Executive Vice President Airline and Accountable Manager at Luxair.

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Many independent regional carriers have vanished in recent years while Luxair is still around. How have you managed to survive while others have not?

Though it may be a regional carrier in terms of structure, Luxair is closer to a traditional flag carrier. We operate in a very particular niche market – Luxembourg which despite being small, is actually a quite wealthy country. To add to that, parts of Germany, France and Belgium also fall within the confines of its direct catchment area.

As a more traditional airline, our development philosophy is therefore more conservative with our focus primarily on generating enough capital reserves – with success.

Furthermore, Luxair is not only an airline but a platform as well. Aside from the mainline carrier, we also have an in-house tour operator. In addition, a large majority of our employees are also involved in the cargo handling sector at Luxembourg-Findel, one of the world’s most important cargo hubs.

Two Bombardier Q400 and one Embraer 145 on the ramp at dawn – Copyright: Luxair

As a traditional carrier, Luxair has significant cost overheads. How can a relatively small airline sustain such high costs?

Cost overheads are definitely one of our more critical problem areas. They are quite high, especially those related to flight operations. But they aren’t only a legacy issue, but also a result of legal requirements. While we currently operate seventeen aircraft, if you look at the size of our administration, we should easily be able to handle fifty. Unfortunately, it is impossible to reduce our existing costs due to the aforementioned legal obligations.

As a result of all of this, we have had to focus on growth. A few years back, we relied heavily on flying a few monopoly routes with very high yields. But today, we have revised that strategy and are now focussed on providing cheaper fares albeit with greater capacity.

This shift was brought on, in part, by the arrival of Low Cost Carriers here in Luxembourg. A good example is our London City route. We used to fly there three times daily with an Embraer 135 before we took delivery of our first three Q400s as replacements.

Given the Q400’s greater capacity, it would then have made sense to reduce the route’s daily frequency to just two daily flights. But instead, we added a fourth daily frequency. Within a year, the Q400‘s load factor had surpassed that of the ERJ-135 and today, we now fly on the route seven times a day. Similar developments have occurred on other routes.

In comparison to the budget airlines, we still have the advantage of being able to add more frequencies as and when demand dictates. So while our yields have decreased by a total of 12% over the past four years, our passenger numbers have grown 14% year-on-year.

Lufthansa has recently become a competitor after previously being a very close partner and shareholder. What impact has this had on your business?

Following Lufthansa’s decision to terminate its cooperation agreement with us, we were forced to close our Frankfurt route as 95% of all travellers there were connecting passengers. Regarding our Munich service, we were actually in competition [with Lufthansa] before as we had both plied the route. The only difference there is that now, that competition has become a lot more intense.

In the greater scheme of things, it has always been our strategy to partner with as many carriers as possible. We are always open to cooperate with anyone willing to cooperate with us. This has been, and will continue to be, our ethos.

So while we have lost Lufthansa as a partner, we still have many others like Air France, Austrian, LOT and hopefully, SAS before long. In fact, we’ve noticed that our passenger flow dynamics have changed in the months that followed the end of our relationship with Lufthansa. For instance, we now have many more customers that choose to fly with us to Paris CDG and from there, onward with Air France.

Boeing B737-800 taking off – Copyright: Luxair

How do you plan your schedule? Is drawing connecting traffic via your Luxembourg hub a priority?

Basically, we are a point-to-point carrier and that is how we build our schedule for most routes. Some destinations we serve are interesting in terms of onward connections and there we obviously try to time our flights to ensure smooth as well as competitive transfer options.

But the number of passengers connecting in Luxembourg is almost non-existent. If there are any, it is usually just by random chance. That said, we currently have no plans to turn Luxembourg into any kind of transfer hub.

LOT and Flybe are new carriers to Luxembourg. Low-cost carriers are also adding many new flights. Where do you think that sudden interest in the Luxembourg market has sprung from?

Over the past couple of years, the Luxembourg market has experienced a significant growth spurt that has continued to this day. This has resulted in Findel becoming one of the fastest growing airports in Europe. There are several factors at play here. One of them is obviously that we have changed our strategy towards lower fares and higher capacity. With the resultant growth in demand, other carriers have been curious to see what the market is like and have thus launched their own respective services here. So it seems that unlike now, in the past, the Luxembourg market was completely misunderstood and therefore underexploited.

You also operate scheduled services within Germany and last year, you ran charter flights from France to various leisure destinations. Are you planning to expand abroad?

Well it is very important to distinguish between scheduled services and leisure charters here.

Our scheduled division works on offering the best possible connections out of Luxembourg. Currently, we fly domestically in Germany from Saarbrücken to Hamburg but Saarbrücken is actually only a brief stop on our flights from Luxembourg to Hamburg. We previously also did this with flights to Munich and Berlin but have since dropped it on both routes. It has nothing to do with strategy and it is not growing, as you can see. It was just an opportunity we took advantage of.

Luxair Tours, our tour operator, is a completely different ball game. They have their own product and actually exclusively plan their operations around our four B737-800s and two B737-700s. We also use the -700s from time to time on our mainline flights to Madrid or Portugal.

So almost six aircraft at your disposal means having a lot of capacity on your hands and that means that on occasion, Luxair Tours charters out the aircraft like they did in France last year. This summer, there won’t be any really noteworthy business in France.

An airline having such a large tour operator arm like you is something rather unique in Europe…

Luxair Tours primarily focuses on traditional package tourism and has no overlaps with our scheduled business.

But the B737s present us with difficulties. As I explained earlier, they are actually a kind of separate fleet but there are some routes where they make sense for us, like Madrid. It has, for a long time, been difficult to deploy the B737 on scheduled flights as Luxair Tours manages them and our scheduled operations do not have high demand for them. But there are some Luxair Tour flights where the number of flight-only (rather than as part of a package) tickets sold outnumber those including package deals. In situations like these, we have to be prudent about how to proceed in the future.

But there is one thing that is very important for us; Luxair is an airline that offers a very high quality of service, even on leisure flights. For the LuxairTours destinations, we serve hot meals, alcohol and so on and local customers love that aspect of our product. In fact, many make it a point of flying with us when heading off on their holidays.

So we have made it a priority to retain that quality of product and appeal to customers as in the long run, it secures their return business as well as profits.

Boeing B737-700 parked on ramp in the morning – Copyright: Luxair

Your B737 fleet suffers from seasonality problems in particular. How do you deal with that?

It’s a problem, of course. The B737 fleet makes a lot of money for eight to ten weeks in summer, but for the rest of the year it is a zero-sum game or worse yet, a loss. To try circumvent this problem, we use the winter months to undertake major maintenance and so on but obviously there is still the issue of having a lot of surplus capacity.

You are one of the very few remaining airlines operating regional jets with 50 seats. Has it become a more pleasant ordeal now that fuel prices have come down?

Fortunately for us, we’re only going to keep our Embraer ERJ-145s around until October. They are from an era that has long gone and it is not only fuel prices that have killed them off. It also has low capacity and very high costs per seat. In our network, it actually made some sense to use them on flights to Geneva; a route with high yields but little demand. They were also well suited for some longer routes where the slower speed of the Q400 proved problematic.

But it wasn’t only heavy overheads that gave us problems with the ERJ-145, it was also yield management. It is nearly impossible to generate sufficient returns in such a harsh and competitive environment. You can only sell some promo seats but that’s about it, you need seats sold at high fares after that.

Besides all of the above, the aircraft also no longer fits into our daily business plans anymore. The two ERJ-145s average sixteen years of age and will soon require major engine and landing gear overhauls as well as a structural inspection. Given those added costly expenses, it simply makes no sense to keep them in service.

So while the final ERJ-145 flight was actually planned for May, the writing off of one of our Q400s forced us to delay that date to October.

Bombardier Q400 LX-LGF – Copyright: Luxair

Can we expect any further changes to your fleet in the near future?

Yes, you can. Our fleet will soon consist of ten Q400s, two B737-700s and four B737-800s. We are planning to take delivery of several new regional jets with a capacity above the Q400’s between 2018 and 2020. They are going to not only increase our capacity, but also replace some of our older Q400s and the two B737-700s from 2020 onwards.

Back in 2012 we began looking into newer and larger regional jets as possible replacements for the Embraer aircraft but could not find any suitable options. Either the aircraft offered were too expensive or outdated. With so many new regional jets on the market right now, it now should be easy to find a good one. But they have just come too late to replace the ERJ145 so taking the additional Q400s as an interim solution turned out to be the best option for us going forward.

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Seawings is a Dubai-based charter specialist. Launched in 2007, it deploys a fleet Cessna 208 Caravan Seaplanes mainly on charter flights for tourists in Dubai.

ch-aviation´s Ivan Nadalet had the possibility to chat with Stuart Wheeler, CEO at Seawings, about the carriers operations and future plans.

Stuart, can you give us a bit of background on yourself. How did you get into aviation?

I’ve been in aviation all my life actually. I started at a very young age when I was a student in England, so I’ve always had the smell of Jet A1. I then worked for 12 years for a company called Dan-Air which was one of the large independent UK airlines.

There, I ran the turboprop aircraft – four or five of them – and we built it up to a fleet of 18 servicing the North Sea Oil market which was booming in the ‘80s. I left there and went to Airbus in the Gulf and Asia. I then settled here in Dubai in 1989 and set up home here in the Airbus office. I was with Airbus for 10 years and lead the teams to sell into Emirates and (other airlines in the region). In fact, I arrived here January 1, 1986 and we signed an MOU with Emirates in June 1986, I think it was, and delivered the first two A310s in similar time in ‘87. I continued with Airbus until 1994 by which time we had about 13 airplanes delivered.

Then I left to set up Air Charter International which was getting back to my roots; focusing on wet-lease. At that time, wet-lease really wasn’t a business tool for airlines but it has grown into that. We have been running wet-lease operations now for 20+ years alongside our charter and leasing teams.

Tell us about your Seawings/Jet-Ops air charter operations.

It’s bit of a history really. Up until 2005, the UAE restricted AOCs to government entities such as Emirates, Etihad etc. There were no other areas to operate in and at that point, I think, the authorities came under pressure to provide a framework for regulations for other operators, because there were all sorts of companies here from all over the place. That is not good for a number of reasons-security among them.

The GCAA (General Civil Aviation Authority of the United Arab Emirates) then accepted applications from several parties. As I had a good relationship with the Dubai Civil Aviation dating back to my Airbus days, we applied for and were granted an NOC and later an AOC by the GCAA. We then had to decide what to do with it. We looked at a number of options including executive jets, but I didn’t want to do that as that would have put us into competition with some of the operators we were using at that time which wouldn’t have been good for business.

Then it occurred to us. We had placed a sea plane in Sri Lanka in 2000. The Sri Lankan Chief Executive was mulling how to improve domestic mobility for tourists and then had an idea; why don’t we get a sea plane? The Chief Technical Officer was Canadian and had some experience, and we were providing wet lease aircraft to them, so he looked at me. I found a seaplane and we facilitated a wet lease in. It was a good experience of what a Cessna Caravan looked like and what it could do.

Then, it was some time after that that I was in Canada watching the airplanes at Vancouver and with an eye on Dubai’s developing tourism market, I put two and two together. In 2007, we started with three airplanes which we still operate to this day.

Copyright: Seawings

Why the Caravans in particular? Did you ever consider any other types such as the Twin Otter?

I think at that time we didn’t quite know how big the market was. In retrospect, the Caravans have proven to be the right airplane and have provided us the facility to serve several different markets simultaneously. They also offer redundancy, a key issue for us.

You mentioned that these are the same three aircraft that you have had since the beginning. Have you considered fleet renewal or expansion plans as yet?

We’ve got a fourth airplane, also a Caravan, which is on lease from a Swedish firm, Grafair, for the winter months. I guess that will be a repeat process if we are allowed to do it, or we will have to purchase a fourth aircraft. Three airplanes can generate a lot of seats in a day.

How do your aircraft respond to the very hot and humid conditions here? What about the issue of corrosion?

We are particularly subject to it because we are in the water. As a result, we invest heavily in maintenance. In the summer we soak the airplanes with supplementary maintenance. But one of the challenges we’ve found in the UAE is that there are no AMOs (Approved Maintenance Organizations) for our type of aircraft. There are a few facilities like Jet Aviation but they are more geared towards light work on executive aircraft. So we decided we needed to do it ourselves. We’ve now got our own Part 145 approved maintenance facility and we employ engineers from around the world. We are building our own hangar at the moment at Jebel Ali, which should be completed by September. Currently, we lease space from a helicopter operation at Dubai Al-Maktoum Airport, so by September we should be in our own hangar.

Copyright: Seawings

You mention your manpower base is globally sourced. Have you begun introducing local Emiratis a-la the government’s Emiratization drive?

Yes, we employ Emiratis, in fact our Security Manager is an Emirati. Our experience has been very positive and we would be delighted to employ more.

Concerning the development of young pilots, we are a single-pilot operation and therefore every seat on the aircraft is precious. In bigger carriers like Emirates, locals can climb through the ranks by virtue of the right-hand seat. But with a single-pilot operation, it is quite difficult to do that. Having said that, we are starting an EASA-endorsed ATO (Approved Training Organization) for seaplane type-rating. We should have that up and running by the fourth quarter of this year.

RotanaJet has offered regular services within the UAE in the past. Have you considered branching into the scheduled services sector?

No. We are not authorized to be a scheduled operator.

Is your AOC restricted to charter operations then?

Yes, only national airlines can offer scheduled flights and we are very clear that we are a charter operator.

Copyright: Seawings

What about scheduled charters?

We fly on-demand. We obviously have a high-level program which we work for internal purposes on a scheduled basis with open flights as demand requires. We are definitely a tourism-based charter company, so what we do is offer packages such as a day trips to Sir Bani Yas. We are now developing our tour operations as Seawings which is, in actual fact, a tour operator. Jet Ops holds and manages the AOC while Seawings packages the product and markets.

How many waterdromes are there here in the UAE?

Fifteen, all developed by us (plus all the airports).

Are they all along the coast or also in the interior, like Al Ain?

No, not Al Ain. We have Dubai Cruise, Creek, Jebel Ali, Dubai World, Abu Dhabi, Yas Islands, Emirates Palace, Abu Dhabi Cruise, and Sir Bani Yas Island which is further out. The other way: Sharjah Lagoon, Ras Al Khaimah Creek, Al Hamra and Marjan Island. On the East Coast: Al Dana near Dibba, Khor Fakkan and Fujairah. Each one of them is in calm waters, and that suits the Caravan perfectly.

We have developed each of those water strips and each one has been a challenge. For every strip, we had to get approval and to convince people and that takes one to two years to do. It’s a huge amount of work.

Who forms the bulk of your customer base? Are we talking about the high-end income earners?

It’s a mix. We get all nationalities – British, German, Indian, and the Chinese are big at the moment. But while it is certainly a premium product with flights costing 1600 Dirhams, you would be surprised at the spending patterns. Some people might stay in a three or four-star hotel and can afford something like this. Others stay in a five-hotel. So there is no fixed type or income bracket.

The UAE is a petroleum-based economy. Have you seen any slow-down in demand as a result of the drop in oil prices and its impact on the country’s economy?

Dubai’s market is not petroleum reliant but rather business-orientated and a major global aviation hub. The economy is really driven by business and associated services such as the finance industry, medical and general tourism etc. Dubai is a very unique model. You’ve got 70 million people coming through the airport annually and maybe 25% of them stay here for one reason or other, and they are our market.

With the strengthening of the U.S. dollar and the weakening of the Euro, have you seen a shift in the origin of your international market?

Of course. Britain is still number one, Germany is still number two, India has come up, and the Chinese have hit us like a tsunami!

We’ve discussed your domestic operations but what about expansion abroad?

Well, we’re looking to expand into Oman next year.

How is that going to work from a technical point of view? From our understanding, entry into Oman is only though designated international airports.

Yes, those are some of the issues we have to solve.

Can you expand on the project? Will it entail pursuing an Omani AOC?

I don’t want to be too specific. Just say that Oman is on our radar, and for now what we will do, for example, is offer holidays as a combination between Dubai and Oman, so then we can fly into Oman. Whether it will be on wheels or on floats, we are working through that.

Given that your core market is tourist-based, how do you handle seasonality and how do you mitigate its effects?

Well the big peak season starts in October and carries on through to about the middle/end of May. Of course, within the peak season, we have a couple of very busy periods when demand spikes: Christmas, New Year, and then the Chinese New Year. The summertime has historically been very quiet although we are seeing a rise in traffic at present. How do we deal with that? We plan our maintenance accordingly; we try to undertake and wrap up all our major MRO requirements during the summer months.

We have some flexible arrangements with our engineers so that we will have, perhaps, more engineers during the summer months than in the winter months. The same applies to our pilots. This year, we had seven pilots during the peak season, but our core is four. Each year we decide how many pilots we need to add and take it from there.

What we want to develop is a business policy plan in a market where the seasons are reciprocal, i.e. Europe. In 2011, we created Jet-Ops Europe in Bulgaria and placed an aircraft on its AOC in order to facilitate operations in Europe. But since 2011, the European market has not been so good. Of late, we’ve seen some bright prospects and possibly, in the next year or two, we may see at least one aircraft, maybe two, going to Europe in the summer, but nothing has yet been decided.

Copyright: Seawings

Is Jet-Ops, under the Jet-Ops Europe AOC, planning to offer its own services there in Europe or are you looking at working with other seaplane operators by exchanging aircraft on a seasonal basis like some of the major charter airlines do by alternating between Europe and Asia/the Caribbean?

There aren’t so many [seaplane] operators in Europe, so we have really got to plough our own furrow. Those that are in Europe tend to have their own business models, which maybe better suited to the Twin Otter than the Caravan. There really aren’t so many options to equip other operators. It’s a matter of developing something new, but definitely we want to work with partners, generally companies that have distribution or an interest in starting a sea-plane service but don’t want the overhead of having an airplane all year-round. While owning and operating a seaplane is a passion for some people, the fact is, if you can’t keep your airplanes occupied on a year-round basis, you carry this enormous overhead.

Are you just looking at Europe or are you also looking at other areas for growth? Are there any other places in the world where you would try replicating your business model or is it really only suited to Dubai?

I think that’s our first priority. But, while we can expand in Dubai, there are also Abu Dhabi and Oman where there’s decent potential. In terms of WOW! Factor, Dubai has all the attractions needed to charge the prices we do and this generates sufficient revenue to cover the high cost of our operations. You have to have not only water, but also something that’s really scenic; that’s really interesting to look at, and these are ‘must do’ activities. Throughout the world, you can find other places which have got water and some attractions but the question is, will people pay the price, in the volumes that you require, to establish your operation and the answer is not always yes.

With this in mind, again and again, we come back to Dubai and Abu Dhabi which have growth potential and the WOW! Factor. So better to focus on the market that you know and can grow in; we don’t want to conquer the world. But, if an opportunity were to arise elsewhere and if it were to have all the commercial engines I’ve described – good water, some WOW! Factor or a mandatory requirement to have to travel by seaplane – then we would have a look at it. Otherwise, the first priority is to find a reciprocal business partner in the summer months.

MIAT Mongolian Airlines is the flag-carrier of Mongolia and is based in the capital Ulanbaatar. Though it officially launched in 1956, the carrier can trace it roots back to the early 1920s when the country’s Air Force was founded. This year, the airline is celebrating sixty years of service.

As a Soviet satellite and for the duration of the Cold War, MIAT operated a variety of Soviet-made aircraft including Antonov An-2s, An-24s and 26s, Ilyushin Il-14s, and later Tupolev Tu-154s. It was not until the collapse of the USSR and the advent of multi-party democracy that MIAT received its first Western-manufactured narrowbody aircraft, a B727, in 1992 and its first widebody aircraft, an A310, in 1998.

Though it was originally mandated to operate domestic flights, MIAT has transitioned into a regional and international carrier with its last local service operating in 2009. Since then, it has focused on foreign markets employing a relatively modern fleet of Boeing 737NextGens and B767s.

ch-aviation’s Niels Trubbach had the opportunity to meet with MIAT‘s CEO Tamir Tumurbaatar, its vice president (Operations) Ganbold Namsraijav, and Andreas Christodoulides from Cypriot brokerage firm ZELA Aviation, appointed GSA of MIAT on ACMI, in Prague where he discussed MIAT’s status quo and its future plans.

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Tell us about MIAT’s agreement to lease its B737-800 to Czech ACMI/charter operator, Travel Service. This isn’t exactly something you hear about every day!

We have been working with Travel Service since 2015. This year is the second summer we will be operating in Europe and the overall intention is to deploy a part of our capacity on global ACMI contracts on a year-round basis. But even though we have yet to sign an ACMI contract for the upcoming winter season, we can always ferry the aircraft back to Mongolia and use it there.

So in order to build up our ACMI business, we have signed a co-operation agreement as GSA with Zela Aviation from Cyprus which has been supporting us. We see great potential in the leasing sector in terms of increased revenues and profits.

Aside from our core business as a scheduled operator, our ambition is to make Mongolian Airlines a known and respected brand in this particular market segment.

Were you faced with any major challenges when starting operations in Europe?

A big advantage for us as Mongolian Airlines is that we are an IOSA-certified carrier. Furthermore, few of our aircrafts are registered in the European Union. So those two factors together made it relatively uncomplicated to start operations from the Czech Republic.

What makes Mongolian Airlines a great ACMI partner?

We are a very experienced airline and are used to operating in tough conditions. We are therefore a good choice for airlines seeking a reliable capacity provider with excellent quality and safety performance. Furthermore, we are a relatively flexible carrier. In terms of cost, there are cheaper operators but we can still offer very competitive pricing. All things considered, you can say that we offer very good value for money.

Looking at recent media reports, the Mongolian aviation market appears to be in crisis at the moment. What are your thoughts on this?

Passenger demand and the overall development of the airline market is always directly related to a country’s economic growth. Mongolia, like other mining-dependent countries, has been hit hard by very low mineral prices that have rocked the market since 2012. So naturally, this has led to a decline in demand. But, on the other hand, tourism is picking up and that has made up for some of the decline in business traffic.

One of your competitors, Hunnu Air, has now switched to domestic operations. How would you characterize the rise and fall of Hunnu Air?

Currently, there are three scheduled carriers active in the Mongolian market: MIAT; Aero Mongolia; and Hunnu Air. While they may be different companies, we have no intention of competing with them, preferring instead to cooperate.

We are not really sure about what Hunnu Air was aiming for when they started international flights. We competed with them on some routes, but in 2014 they withdrew from that market segment, returned their A319s to their lessors. They are no longer a competitor.

But, during the brief period when they did fly internationally, they obviously lost a lot of money. They were about to fly to Paris with an A319 making two stops which would have been very difficult to make work when compared to our B767s. They appear to have now revised their strategy based on domestic Mongolian operations and it seems to be working out for them.

What is interesting though is that initially, Hunnu Air was named Mongolian Airlines Group. It took a legal battle and many months before we could force them to change their name.

MIAT Mongolian Airlines Boeing B767-300 – Copyright: Tis Meyer –

From a European perspective, Mongolia is known primarily as a tourist destination. How important is leisure traffic to you on intra-Asian routes?

Mongolia is a unique and popular leisure destination with tourists coming from all over the world to visit it; not only Europe and the United States, but Asia as well. The number of tourists is steadily increasing and therefore passenger throughput is increasing as well.

But while it has great, albeit underdeveloped, potential, the tourist market is very seasonal. While in summer, the leisure segment can constitute almost half of our passengers, during the winter, when it is very cold, those numbers plummet.

What other market niches are important to MIAT?

Aside from the business travel and tourist markets, a very important segment to us is that of the Mongolian diaspora. You see, there are large Mongolian expatriate communities in places like Berlin and Seoul so naturally that leads to strong demand for flights back home.

In Europe you serve two destinations that are relatively close together: Berlin and Frankfurt. Do you have any plans to consolidate your European long-haul operations into a single, all-encompassing destination?

Berlin sees strong demand for point-to-point traffic mainly due to the large Mongolian diaspora living in the city. As such, its core market segment is mainly driven by ethnic passengers. And as we route the flights via Moscow and have permission to sell tickets on both sectors, we can increase the number of passengers and revenue. This summer, we will perform three flights per week.

But while Berlin is great as a destination, it is not an ideal transfer hub. So to that end, we launched Frankfurt and are developing it into our local transfer hub for passengers from all over Europe, and beyond, heading to Mongolia. Currently, Frankfurt only operates during summer given how reliant it is on leisure traffic.

So as you can see, the two destinations target two different consumer groups and as their market dynamics are mutually exclusive, it makes sense to retain both of them.

Copyright: MIAT Mongolian Airlines

Do you have any plans to expand your longhaul network?

In Europe, we would like to serve London. We had initially scheduled it for 2017 but have been forced to postpone it. Direct London flights would cannibalize our Frankfurt route and there simply are not enough passengers at the moment to ensure either destination will have sufficient demand.

Right now, our expansion is focused on Asia where we recently launched Singapore and are considering resuming flights to Bangkok. Also we want to grow through code-shares, especially out of Frankfurt where we are already in discussions with various airlines.

MIAT no longer offers domestic services. Do you co-operate with any domestic carriers and have you considered venturing into the market again?

There are two domestic airlines in Mongolia – Aero Mongolia and Hunnu Air. We do not want to compete with them but instead have chosen to build a good relationship with both domestic carriers. This summer, for instance, we will operate selected domestic routes for

and on behalf of Aero Mongolia which currently has no jet aircraft of its own.

Aside from your three 737-800s, you also operate two 767-300(ER)s one of which is relatively new while the other is almost 20 years old. When do you plan to replace it?

The lease agreement for our older 767 expires in September 2018 so that is when we will have to get a replacement in place. We are considering the 787 but that really depends on how things pan out for us. Overall, we reckon we have a bright future ahead of us so there should be room for expansion. But, as our newer 767 is owned, we might also opt to acquire another new 767 in order to keep the number of aircraft types in our fleet to a minimum. But conversely, as we are working on becoming an important player in the longhaul ACMI market, we could also see ourselves having the two 767s flying charter contracts while the 787 operates our scheduled services.

The scenario with our B737s is quite similar. We have ordered the MAX but have not yet decided on how to continue with our existing B737-800s. It really all depends on future developments.

MIAT Mongolian Airlines Boeing B737-800 – Copyright: Tis Meyer –

Your two 767 aircraft have different configurations. Why is that?

The older of the two aircraft is leased and its cabin layout is fixed. As we own the newer aircraft, we were able to select the configuration prior to delivery. But while we would actually like to have both aircraft sporting the same layouts, the high cost of refitment would far outweigh any advantages. So we’re stuck with two different configurations for the time being.

MIAT is state-owned. What is the Mongolian government’s main interest in the airline?

Mongolia relies on air transport given that it is such a big country. The government wants us to ensure good connectivity and therefore maintains ownership for strategic reasons. But despite its shareholding, it wants us to be self-sustaining and is therefore unwilling to subsidize us. Soon, a new airport will open in Ulanbaatar which will make flying easier for us, but will also result in more foreign airlines coming thereby leading to stronger competition.

What are your goals for the next years?

Overall, our goal over the next few years is to grow and expand. As the national flag carrier, MIAT Mongolian Airlines should connect Mongolia with rest of the world and to that end, we want to improve Mongolia’s connectivity by adding more destinations especially through code-shares with other carriers. Aside from scheduled operations, we are also determined to become a major ACMI and capacity provider.

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Air Zimbabwe is the national flag-carrier of Zimbabwe and is owned by the government, its sole shareholder. Founded in 1980, Air Zimbabwe can trace its lineage back through Air Zimbabwe-Rhodesia and Air Rhodesia, to Central African Airways, the colonial airline founded in 1947 to service the then Federation of Rhodesia and Nyasaland, and which also gave birth to two other now defunct carriers – Zambia Airways and Air Malawi. Though Air Zimbabwe experienced nearly two decades of solid growth with flights covering Southern Africa, East Africa, and Europe, the rapid decline in the Zimbabwean economy between 2000 and 2009 seriously impacted its business and finances culminating in the suspension of operations in 2012/13. But, while limited domestic and regional services have since resumed, longhaul continues to remain elusive.

So what are Air Zimbabwe’s prospects in the rapidly changing Southern African market? With the advent of Low Cost Carriers such as Fastjet and Flyafrica, is Air Zimbabwe geared for the future? ch-aviation’s Ivan Nadalet and Max Oldorf headed to World Routes in Durban to chat to CEO Edmund Makona to make sense of the airline’s status-quo, its turnaround plans and its longterm goals.

Learn about Air Zimbabwe on ch-avation:

Ed tell us a little about yourself. How did you get into the aviation business?

I got into aviation as far back as 1985. My background is that I’m an aviation engineer and aside from that I have been involved in various safety-initiatives around Africa under AFRAA (African Airlines Association) and IATA. I am very passionate about safety especially within the context of the African Aviation renaissance. Concerning said renaissance, I believe African aviation has enormous potential and, yet, it continues to be underrated.

Air Zimbabwe’s financial difficulties are no secret. However, recent reports in the Zimbabwean press suggest your sole shareholder, the Zimbabwean government, is planning to recapitalize the airline and absorb its debt burden. What’s the immediate game plan to get Air Zimbabwe back on the road to profitability?

The immediate game plan involves the restoration of market confidence in Air Zimbabwe wherein various milestones have already been achieved. The second issue relates to stopping the bleeding of the airline. So there are various initiatives, underpinned by cost reduction and revenue enhancement, which the airline has so far undertaken.

Can you expand on what these initiatives are?

We propose to go about that by means of a restructuring of the airline, in order to make sure that we increase productivity. We are also focusing on reducing unnecessary costs while introducing cost-efficiency measures. We have already looked at revenue diversification. It’s one issue that is clear in our minds. When you look at aviation today, profit margins stand at USD29.4 billion or 3% from a global revenue total of USD623 billion. So for the African market, that translates to about USD1.50 profit per passenger per seat. That alone will not sustain the industry. Maybe much less than what you need to buy a chocolate, isn’t it? So that leads us to the whole issue of revenue diversification and ancillary revenue collection. While flying will continue to be our priority, it will have to be sustained by other means which Air Zimbabwe has already looked at including establishing ourselves as a key MRO facility in Southern African given our existing IOSA certification. We have also started the process of securing European Aviation Safety Agency (EASA) certification.

Air Zimbabwe Hangar – Copyright: ch-aviation

Air Zimbabwe operates a relatively old fleet including Boeing 737-200Advs and B767-200(ER)s. Despite their age, they are actually only half-way through their cycles. Is that correct?

That’s very true.

Do you therefore intend to embark on a fleet renewal program as part of your restructuring effort, or is that only going to be left for later?

I think the first thing I must underscore is that, and you rightly say this, the fleet is underutilized in terms of cycles. The Air Zimbabwe fleet has not even reached half its minimum half-cycle in terms of lifespan. In terms of safety those aircraft have a typical seventy-five thousand (75’000) cycle Limit Of Validity. In terms of age, yes, our B767 and B737 average just over twenty years of age which does impact us in terms of maintenance and fuel costs. In terms of our strategic plan, we intend to capitalize on and maximize the use of our aircraft first before pursuing fleet modernization which will follow in the second phase.

What’s on your shopping list?

There are quite a number of available options. We are looking at aircraft within the medium range. We have already secured Airbus A320s.

Are you shifting away from your traditional dependency on Boeing towards Airbus? Or, is this lease just a one-off arrangement?

Within the context of our renewal strategy we’ve said ‘What do we have available?’ Well, we have the Airbus, which is part of our fleet at the moment. But we have not really shifted away from our original position of having Boeing aircraft given that they are also a part of our fleet. But there is need to optimize our operations in terms of fleet standardization. Now, with Airbus the next obvious thing to look at would be the A330 which would then naturally become the aircraft of choice for the long haul. But we are also keen on Boeing’s Dreamliners for our longhaul needs.

Air Zimbabwe Boeing B767-200 in Harare – Copyright: ch-aviation

So you are also considering the A330 and the B787?


Are you looking to acquire the aircraft outright as with your existing Boeing fleet, or are you looking to lease in the interim?

The answer to that question lies in our strategic plan. Government, as the sole shareholder, has been mandated to find a strategic partner for the airline. So, any prospective strategic partner that does come in will inevitably have to deal with the issues of old equipment. This will, in turn, tie in with our plans to modernize the fleet. So, securing new aircraft is seen as a last resort in the event we are not able to secure a strategic partner. But, I’m happy to say, at the moment, there have been a lot of promises from a lot of big airlines keen on partnering us and we very remain hopeful.

Are you able to disclose any of the potential partners?

Not at the moment. There are quite a number that are interested in marriage. But, for the time being we are not in a position to disclose whom they are.

Concerning your hunt for an investor, there has been a lot of negative press about Air Zimbabwe vis-a-vis the recent corruption scandals that have engulfed top management. How will you guarantee a strategic partner that any financing they do put up will necessarily go towards operations and they themselves won’t be caught up in any political shenanigans or interference? To put it bluntly, how would you guarantee a potential strategic partner that their money will be used correctly?

I think the first thing that I would want to say is that from the national point of view, the Zimbabwean government is taking a strong position in terms of the eradication of corruption which the President of the Republic of Zimbabwe, his Excellency, Robert Gabriel Mugabe emphasized under the terms of the Ten-Point Plan [Ed note. a plan presented to parliament in August which aims to maintain economic growth in particular the creation of jobs]. Among the issues that the Zimbabwean government is focusing on is the eradication of corruption. That on its own will give any would-be investor the amount of confidence that is required. Take away the airline. We want to look at it from a national level and say ‘this is the pronouncement from the head of state of Zimbabwe’. That corruption is now going to be a thing of the past and the government is no longer going to condone corruption. So, you don’t want to look at this at the level of Zimbabwe alone, but at the level of Zimbabwe, as a state. This is now the way we are going – it’s a new page that we are turning.

Air Zimbabwe Maintenance & Engineering – Copyright: ch-aviation

When you mention the term “strategic partner”, are you looking for someone to take over the airline or only control a minority stake in the carrier?

There are a number of options that are being looked at, but I can definitely state that the taking over of the airline is not on the table. Rather, we are looking at a partnership.

How will that play out in light of Zimbabwe’s very controversial Indigenization act? Will the law capping foreign ownership in the airline at 49% be enforced or is there room for some flexibility?

I wouldn’t want to comment on this other than to say it is a policy issue and is therefore up to government.

Let’s move onto your route network plans – longhaul in particular. Do you have any new destinations on the radar screen?

Many. Within the region we are targeting quite a number of destinations: Durban, Cape Town, Dar Es Salaam, Lilongwe, Juba in South Sudan. Further afield, we are also looking at resuming London, Dubai, and Beijing.

Given recent deferments, when do you intend to resume your flagship Harare-London Gatwick service and what has been the cause of the delay?

I wouldn’t want to say “delay” but we did have issues in 2011 and 2012 wherein the airline suspended operations prior to re-launching using a phased approach. Firstly, we focused on the restoration of market confidence which was followed by the rebuilding of our domestic and regional networks. We are now looking to resume longhaul international operations.

In terms of the Yamoussoukro Agreement [Ed note. a multilateral air service agreement to liberalize Africa’s skies, first proposed in 1988], some of your fellow CEOs, primarily those in the private sector, have argued that given a lack of commitment from member states, the accord has now been rendered redundant and that integration should be taken via a phased bloc approach. For example member states of SADC, ECOWAS and EAC would first focus on Open Skies within the confines of their own blocs before opening up to one another. What’s your opinion on that?

Liberalization has to be looked at from a supranational perspective. At the last African Union summit in January, Yamoussoukro and the move towards a single African market featured prominently on the agenda while in October of last year, AU Commission Chairwoman Nkosazana Dlamini Zuma, was clear about the role the aviation sector is to play in the implementation of the AU’s Agenda 2063. Now, that alone indicates that, at that level, there is an understanding that the implementation of Yamoussoukro is not an option. And, arising out of the same meeting, there were eleven states that committed to the implementation of Yamoussoukro, well before the deadline of 2017. And, Zimbabwe’s one of them. South Africa is as is Egypt, Kenya, Uganda, Benin, Cape Verde, Republic of Congo, Ivory Coast, Ethiopia, Nigeria, and Rwanda. InterVISTAS’s study provides further evidence on the benefits of total integration including the creation 155,100 jobs in each country’s aviation and tourism sectors as well as boosting each country’s GDP by USD1.3 billion. So, what is lacking, in terms of the non-implementation of Yamoussoukro by the 44 states, is an understanding of the accord’s benefits and the non-availability of a regulating mechanism.

As you’ve just mentioned, eleven states have now signed up to implement liberalization. Is this not proof then that a phased, regional approach is the key to achieving full continental integration in the longrun?

I personally wouldn’t want to look at it that way because that would suggest that the non-implementation of Yamoussoukro is as a result of unwillingness on the member states’ behalf. Rather, I want to underscore that with any change there is potential for resistance – it’s human nature. People don’t look at it in a positive way and say: “This is going to transform us for the better.” So, in my opinion, the lack of implementation of Yamoussoukro has been solely centered on the non-appreciation of its benefits as well as a lack of clarity in terms of how it will be effected.

Zimbabwe has begun opening up its domestic market to more operators – LCCs in particular. Though Zimbabwe flyafrica is now inactive, Fastjet Zimbabwe is operational with plans to start regional flights in the near future. How is Air Zimbabwe preparing for this sudden influx in competition?

Well I must hasten to say that Air Zimbabwe has always been ready. We have prepared our strategy to take into account external factors, as well as threats and opportunities. So, our strategic plan will insulate us against any would be competitors. The issue about Air Zimbabwe today is that within our study we’ve said: “We will continue to do what we are doing.” Aviation is a game of resilience. Those that don’t make it will just fall by the wayside. And, the market will separate the boys from the men.

But, are you not saying that by virtue of the fact that you are a government-owned entity? If you were a private operator your point of view would necessarily be more pragmatic.

I want to say No because even though Air Zimbabwe is government-owned, we are not sustained by funding from the shareholder. So. in other words, this is a clear demonstration that the Zimbabwean government’s desire to ensure that Air Zimbabwe becomes a profitable and self-sustaining entity. So, we are not necessarily being spoon-fed from the government.

Air Zimbabwe Headquarter in Harare – Copyright: ch-aviation

Tell us about your safety culture. Air Zimbabwe is one of the very few African airlines that has never suffered a fatal accident since its inception in 1980.

Thank you very much for acknowledging that Air Zimbabwe is rated as one of the safest airlines not only in Africa, but in the world. While it is a crowning achievement, it puts pressure on us to ensure that we continue to maintain such standards. Despite our financial challenges, we have made sure to inculcate into our workforce a strong safety culture. And, you are well aware, safety isn’t defined by the absence of an accident, nor the presence of it. It is about the implementation of a robust, hazard identification and service risk management system. And, this is precisely what we are doing. I guess the lesson here is that, you can make safety a cornerstone of your business culture even with meager resources. And this is a policy which we have pursued and we will continue to pursue at Air Zimbabwe. And our safety standards more than meet those of international institutions. We’ve undergone IATA audits since 2008 and we’ve been able to consistently meet all safety-related obligations.

Onto Zimbabwe’s infrastructure. We’ve seen Victoria Falls International Airport will soon commission a new terminal and runway capable of handling widebody aircraft. In fact, Turkish Airlines, Emirates, and Qatar Airways have already expressed great interest in starting direct international flights there. With its advent as Zimbabwe’s third international gateway and given the area’s enormous tourism traffic, are you not concerned its opening will cannibalize traffic away from your Harare hub?

There are two issues that we will look at here, and the question is – where is Victoria Falls? It’s in Zimbabwe. Where is Harare airport? It is in Zimbabwe. So whichever way it is, the issues are that Zimbabwe, as a nation, as a country, will benefit from this project. But, Victoria Falls is purely a tourist destination and we want to leverage that and develop it into a tourist hub. But, at the same time, when we look at Harare, we also want to develop it into an international hub. Given its proximity to other African capitals, Harare makes for a very attractive secondary regional hub.

Considering Zimbabwe’s current economic slowdown, is the country capable of sustaining two hubs? Next door in Mozambique, Aeroportos de Moçambique (AdM) is actually considering reducing the number of international gateways from eight to three to help boost through-put at national carrier LAM – Linhas Aéreas de Moçambique as well as their main Maputo, Beira and Nacala hubs.

The issue is not about having a large market. What I want us to look at is passengers from outside Zimbabwe. The impression you give is that we are focusing on the domestic but in reality we are looking at the wider route network where we will be able to bring in foreign passengers.

In an ideal situation, where would you like to see Air Zimbabwe in ten years’ time?

We have tasked ourselves to become better, and to achieve that we have benchmarked ourselves against the best in the industry. We also want the carrier to be a reflection of Zimbabwe, that when you see the airline, you see a reflection of the country. At the same time, we are also looking at being a catalyst for social-economic progress. We cannot create a hub concept in Zimbabwe, if we do not have a robust national airline. So, it is in this context, that we are inspired to achieve more, by ensuring that the national airline takes its rightful position in aiding the country’s progress.

Ed Makona, thanks for talking to ch-aviation.

Thanks very much.

Learn about Air Zimbabwe on ch-avation:

Bangkok Airways roots go back to 1968. The airline is performing scheduled flights for almost 30 years now and is thereby the first privately-run scheduled domestic airline.
In 1989 Bangkok Airways opened the first own airport, Ko Samui, followed by Sukothai in 1996 and Trat in 2003.

The airline has grown to remarkable size with 32 aircraft deployed on flights to 25 destinations in 11 countries. It has an important role in the domestic market, where it does compete with low-cost airlines like Thai AirAsia, Nok Air and Thai Lion Air and as well as with Thai Airways which also follows a full service concept like Bangkok Airways.

Ivan Nadalet and Max Oldorf, Editors at ch-aviation, had the possible to talk with Peter Wiesner, Senior Vice President Network Management at Bangkok Airways about the business and its future development at last year’s World Routes conference in Durban, South Africa.

Learn about Bangkok Airways on ch-avation:

Peter, can you introduce yourself and give us a little bit of background information on your tenure in aviation as well as Bangkok Airways?

My background in aviation is that I worked for Swissair for over 30 years, in various positions. My last position there was as country manager for Thailand and Indochina. Though I took early retirement, I have now been working for Bangkok Airways for the last 15 years. Our company is growing; we’re expanding. When I joined Bangkok Airways, we had eight ATRs, today we have ten along with nineteen jets and this year, we expect to carry a total of around 5.2 million passengers.

Copyright: Bangkok Airways

You describe yourselves as a boutique airline. What exactly is a ‘boutique airline’?

Well, a boutique airline is like a boutique hotel – small, good service, and reasonable prices.

What is Bangkok Airways’ market segmentation? Is it more inclined towards leisure or business?

We are mainly a holiday airline basically serving tourist destinations. We own three airports – Koh Samui, Sukhothai, and Trat – and that’s where our bread-and-butter lies. We have close to 45 flights in and out of Samui a day. During the high season, there are 25 from Bangkok starting at 6 in the morning running until 9 at night. In essence it’s a shuttle. We offer flights from Samui to Singapore, Kuala Lumpur, Phuket, Hong Kong, Utapao, Krabi and Chiang Mai. We are very strong, I am very proud to say, in Cambodia as we offer the best connections from Bangkok to Phnom Penh. This winter, we expect to operate six daily flights. So whenever someone arrives on-board an interline partner, within two hours, there’s a flight.

So, you have not considered going the low budget route?

No, not at all. In fact we want to be different. We offer lounges for economy class passengers and to the best of my knowledge, we are the only airline in the world to do that.

Copyright: Tis Meyer –

Thai Airways International has set up their own ‘budget’ subsidiary – Thai Smile. Has Bangkok Airways thought of setting up its own budget subsidiary which would allow you to take on the already established LCCs such as Nok Air, Thai AirAsia etc.?


So Bangkok Airways prefers to remain a more orthodox full service carrier?

Absolutely. In my opinion, it wouldn’t make sense as we would have to build up a totally separate company. Also, every time a legacy carrier ventures into the LCC segment it fails because its mindset is different. Ideally you would have to start off with a clean sheet in terms of leadership. But what happens 90% of the time, is that airlines place managers from the mainline carrier into the LCC which creates problems as they still have their old ‘full-service’ mindset. You have to start with a clean sheet like what Singapore Airlines did with their Tiger Airways LCC subsidiary.

As a full-service carrier, what has been the impact of newly established budget carriers such as Thai Lion Air and Thai Air Asia?

It’s a different market. I always compare aviation with hotels. You have 1-star hotels and 6-star hotels, and each has to find its niche. Say for example you are a tourist flying to Phuket, which both we and the budget carriers serve. With the Low Cost Carriers (LCC), you arrive in Bangkok, transfer to Don Mueang airport or maybe even take a bus. In all it takes you probably 5 hours more and you save perhaps $20 to $25. But now, if you fly with us, your baggage is checked in all the way through in Europe. You even get your boarding pass in Europe. Adding to that, within 90 minutes of arrival in Bangkok, you can take your connecting flight.

Copyright: Tis Meyer –

You have been in the Thai market for 20 years now. How has it changed since you first got into it?

Well twenty or thirty years ago when I first arrived, the Thai domestic market was limited to Thai international Airways and Bangkok Airways. Back then, the law did not allow any other carriers to operate domestic flights. However, 12 years ago this changed, and Thai Air Asia came in with low fares and with the slogan “Now everybody can fly”. They went after bus and train passengers heading to Chiang Mai which even now can take up to 12 hours. Fast forward to today where we have LCCs such as Nok Air, Thai Lion Air, Thai Air Asia, and Thai Smile while we and Thai Airways Int’l are still full service operators. So each has to find their own niche as the amount of domestic demand has gone through the roof. There are a lot of people that fly up and down now and don’t even consider the bus or train because simply put, flying is now more convenient not to mention affordable. Now to compete with the LCCs we have had to adjust our prices just as they have had to do in Europe where the legacy carriers now offer a limited number of seats at lower prices.

We have seen that ASEAN (Association of South-East Asian Nations) member states are now preparing for Open Skies amongst themselves. What is Bangkok Airways’ position on this?

In a way it is a good thing. But the problem with ASEAN is that compared with the European Union it is a looser association with no Brussels to dictate and enforce policies among member states. In the aviation context, today all ASEAN-based carriers should be able to fly to each member country’s capital city. But Indonesia, the Philippines, and Laos have not allowed that and there are various reasons why they choose to do so. Some claim they have no available slots – Manila has no slots, Jakarta has no slots, but they conveniently ignore availability at other airports. I’ll give you another example – Laos. We would like to get a second flight into Vientiane, but we can’t because the Laotians are protecting their own carrier – Lao Airlines. And I can understand why because the airline is small and Laos has a population of only 7 million people. If Thai Airways were to fly in 3x a day, Silk Air from Singapore 3x a day, Lao Airlines would be run out of business. In essence, it amounts to protectionism for their markets and local carriers. So to answer your question, yes, Open Skies is a good thing if done correctly and in small steps.

So, Peter what would you say is your strongest performing market?

Well, the UK is doing very well, and Germany is doing extremely well. Depending on the month, it is either one or the other that is number 1 in Europe. And now it seems Germany. France is doing well and Italy extremely well. In terms of our operations, I would say Samui is our strongest destination.

Copyright: Tis Meyer –

How has the ICAO Serious Security Concern (SSC) instituted against Thailand this year affected Bangkok Airways’ operations?

Well look, in Thailand there are always ups and downs. We’ve had SARS, chicken flu, floods, we had an airport closure for 10 days, we’ve had demonstrations, we’ve had a coup, and recently there were bombings. But the Thai tourist market is very resilient. Despite all these events, within two months, everything returns to normal. So, we didn’t really see a lot of cancellations – in fact traffic is still regular and we still get advance bookings.

Given the number of codeshare agreements Bangkok Airways is party to, is it considering joining an alliance?

No. It doesn’t make sense for us. Being non-aligned allows us to codeshare with which every airline we feel adds value to us.

So, you prefer independence?

Yes, absolutely. It is also a question of cost. Currently, we codeshare with oneworld and Skyteam members and before long, we will have our first Star Alliance codeshares. Look at the Middle East. We codeshare with all three carriers – Emirates, Qatar Airways, and Etihad. We treat each codeshare partner in the same way – there are no favourites and it is because of this that our principle of operating multiple codeshares with diverse partners works. Everybody is equal. We don’t favour offering capacity to this airline over the other.

How successful was Bangkok Airways’ recent IPO?

It was over-subscribed. We raised around USD400 million.

And that you put towards fleet renewal and retiring debt?

Yes we want to use some of it for working capital but we would also like to build a new hangar for maintenance at Bangkok Suvarnabhumi airport. The existing hangar is at Bangkok Don Mueang International, where we can handle one jet at a time or if we squeeze it, two ATRs. Now our fleet numbers thirty aircraft today but by the end of next year, we expect to have around thirty-four if not more – Airbus and ATRs combined. So we need a facility where we can carry out C-Checks on two jets at the same time.

Copyright: Bangkok Airways

Fully accredited by ATR and Airbus?

Yes, we can do everything up to C-Checks independently. Also, the new hangar will also allow us to do third-party maintenance contracts on ATRs, A319s and A320s.

So you’re looking to expand into the MRO sector as well?

We will be. Yes.

We have seen that Air France-KLM is in talks with Thai Airways International about setting up a joint-venture MRO business there in Bangkok. Are you considering any such partnerships?

No, but we are still early in the project. We first have to solve the issue of hangar space.

What is the current status of the project? Has construction on the hangar gone ahead as yet?

We haven’t been assigned the proper land by AOT (Airports of Thailand) as yet so it has been delayed.

Returning to your IPO, you mentioned some will be put towards fleet renewal capex requirements. Can you expand on that?

As I mentioned earlier, we intend to put some of our IPO funds towards fleet renewal. We lease aircraft today. Some of them are new while some are second hand. But once the leases expire, we intend to renew the fleet with new aircraft some of which we will buy while others will be leased.

Once upon a time, Bangkok Airways considered the A350-800 as a potential widebody but subsequently abandoned them. With the advent of the A330neo and the A350-900, are you reconsidering those plans?

No. In my opinion, we should stick to what we do best – operating short- and medium-haul flights out of Bangkok and Samui. And the reason I say this is simple. Ten years ago, you only had to compete with Emirates and Qatar Airways on flights to London. Today, you have the three Middle Eastern carriers as well as the existing European carriers serving Bangkok and so it has become a very crowded market. Also, why would we want to compete with our interline partners – the Middle Eastern carriers – when we can compliment each other’s operations and make it a win-win situation for us both.

So Bangkok Airways is limiting itself to the A320 family?


Taking that into consideration, would Bangkok Airways consider the A321neo(Long Range)?

We haven’t looked at it yet. But we may consider it if we wanted to serve Japan for instance assuming of course the range is there. But for the time being, No. You see, longhaul we carry out by way of codeshares. We have deals with Japan Airlines, Qantas with Australia, Malaysia Airlines, and many others. We are also part of a two-way codeshare agreement involving five carriers which suits our needs.

Where do you see Bangkok Airways in ten years time?

With probably about forty-five aircraft and a few more destinations, more frequencies on existing sectors. Otherwise, pretty much the same way we are today unless of course everything changes like what has happened in the United States where basically every domestic carrier operates as a Low Cost Carrier in Economy Class while Business and First Class are a far cry from what I understand should be a premium-class offering. Product wise, we will improve as personally I believe our product should match that of our partner airlines. If you fly Business Class from Europe to Bangkok on one of our partner airlines, it should be a seamless experience across the board.

But with Low Cost Carriers gaining ground everywhere, we might have to change; we might have to tweak things a little but, but our intention is to remain independent while focusing on partnerships as we do today. It has proven its value and unless everything goes low-cost we will stick to it. Now, I do not think that Cathay Pacific or Singapore Airlines will pivot towards the budget market offering a 27” seating pitch. If everything goes down today, yes, we will probably have to go in that direction but we will hold out for as long as we can.

Thank you very much!

Learn about Bangkok Airways on ch-avation:

Flynas, formerly known as nasair, is a Saudi Arabian low-cost carrier. It commenced operations in 2007 alongside with Sama Airlines as the first scheduled airlines to be licensed for domestic services in Saudi Arabia by the government. Sama shut down in 2010, leaving nasair as the sole competitor to government-owned Saudia.
During the Aviation Festival in London Thomas Jaeger, had the possibility to chat with Paul Byrne, CEO at Flynas, about the future of his airline and the Saudi Arabian domestic market.

Learn about flynas on ch-avation:

It is an exciting time in the Saudi Arabian market right now with the upcoming launch of two start-ups – Qatar Airways’ subsidiary Al Maha Airways and SaudiGulf Airlines. Even though their exact launch dates are not yet known, how will their eventual entry affect you in the domestic market where you at least have a head start?

I suppose like you say – it would be nice to know if they are even coming. The word we have is that Saudi Gulf is probably the closest to launching but we are still no wiser as to when they are actually going to arrive. Our impression is that they are going to go after the core domestic routes – literally the line between Dammam, Riyadh, and Jeddah. I’d expect that there might be some fluctuation in prices initially, but to be honest with you there is room for everyone on that. We have not found a bottom to that market yet. Ourselves and the other flag carrier Saudia are basically putting on flights and filling them on a regular basis. So it’s one of those routes that is really crying out for more competition. One of the things that would be useful though is, if we were allowed to do market prices as opposed to being fare capped.

What are the fare caps right now, for example on Jeddah-Riyadh?

Jeddah-Riyadh is capped at SAR280 riyals for an economy seat which is less than USD90.00 dollars for a one-way ticket. It’s based on a subsidy that Saudia get that we don’t. We are, however, allowed to break that fare cap within 10 days of departure or a 70% load factor, whichever comes first. We are then allowed to increase our prices by 80% of the fare cap whereas Saudia are only allowed to increase theirs by 10%. It doesn’t really lend itself to open competition as such. We believe that people will pay what people will pay. We have no intention of gouging the market but we think there is a fairer price out there. The most recent survey that was done for GACA (General Authority of Civil Aviation of Saudi Arabia) compared us to the Turkish and Egyptian domestic markets and they found that about 65% of the revenue was missing. So there’s a gap there where we can do well and so can the new entrants. It is just a matter of getting the space to fly there.

You have been in revenue management for a lot of your life so how do you actually deal with these fare caps in an everyday scenario?

Well a lot of it has to do with one of the instructions that I have for the revenue management team and that is to stay available. What we do is try to keep our availability open until within at least a day of departure if possible. Sometimes that is not possible – some of the peak days on Jeddah and Riyadh are just phenomenal. We have had a number of situations where we have added capacity at a moment’s notice. One time there was the Crown Prince Cup [Ed note. A local football tournament] and we put on two A330s and that filled within a day. More recently we had an A320 that sold out in three minutes – it was like a rock concert!

You have personally worked in a lot of emerging markets such as India, the Philippines, and Indonesia. How does customer booking behavior in those markets compare to that in Saudi Arabia?

It’s not very different to be honest with you. The Indonesian market was very last minute. So typically if you look at a lot of our domestic flights for next week, the load factor would be well below 50%. But I would expect most of those flights to be full when they depart. It’s really nerve-racking at times if you have western attitudes to booking curves. Our international routes are a little bit further out but still consumer planning isn’t a big part of the Saudi market which is very similar to Indonesia and India in terms of the domestic markets.

Every year you undertake Hajj and Umrah charters. Do you actually use your own aircraft for these flights or are all aircraft wet-leased in?

They’re almost like a separate airline in a sense. But we do have a separate entity known as flynas Hajj & Umrah which basically concentrates on the Hajj and which is all wide-body wet-lease. This year, for the first time, we are getting involved in the domestic Hajj wherein our aircraft are being used on domestic flights to carry pilgrims in to the Jeddah/Madinah area from all over the country. But typically Hajj season calls for wide-body wet-leases. This year we are expecting one of the best years that flynas has ever had. The team has been very active in securing new markets. I think the last time I looked, we had pilgrimage contracts for seventeen different countries – east and west of Saudi Arabia – which is a fantastic achievement.

Is there actually competition for these contracts or is it that Saudia and flynas are assigned a certain quota that they can carry? How does it work for flights to other countries?

There is, to the best of my knowledge, a set way of going about it. You first need to be approved by the Hajj Committee. In theory, a Saudi airline is entitled to 50% of every market and the national carrier of the other country is entitled to other 50%. If neither wants the business then it can be opened up to a 3rd or 4th party. But typically Saudia gets first choice, we get second and traditionally, Saudia have covered a lot of the bigger markets, possibly with the exception of the domestic. So it is usually carved up.

Saudia is quite ambitious and is ordering a lot more widebody aircraft for the domestic market – A330s in particular. Is that actually backed up by future demand that they see, or is that part of a government policy to increase the number of Saudis that have access to air travel?

Well there is a big push from GACA at the moment to open up as much Saudi air space as possible and use all of the airports in the kingdom. On top of that you have the various large Emirati airlines that are competing with Saudia in the international market, so I think they are feeling the heat there. Personally speaking, I think that there is plenty of room in that market – there’s something like 27 million people in Saudi Arabia and quite a large percentage of that 27 million can afford to fly. So personally, I don’t see it as a threat to us but I think it’s probably more focused at foreign airlines and Saudia’s wish to be a little bit more relevant in the marketplace.

You mentioned the big Gulf carriers before. Obviously, they make it very difficult for an operator like you to fly an A320 to a place like India. But there are also Air Arabia and flydubai opening up new routes to secondary cities in India – has this affected you as well? Are you planning to start international flights from smaller cities in Saudi Arabia?

Seventy percent of our flying is domestic and that’s a fantastic profit centre for us – we’re managing it well and we are a profitable airline which is a first for the company as well as for Saudi Arabia. We see ourselves concentrating on our core product and staying within the Arabian Peninsula over the next couple of years. We have some interesting longhaul prospects in three to four hour-long flight radius. Places like Cairo – we have six destinations in Egypt alone. We are also looking to do a codeshare with Pegasus Airlines in Turkey. So a lot of our expansion internationally will tend to be on the codeshare side. We are trying to do more with Etihad as we have had a long standing codeshare with them. One of our plans is to try to put some metal into that game and fly into Abu Dhabi from Riyadh starting December 16. Typically there are a lot of destinations that we don’t currently fly to in the Arabian Peninsula that we should be flying to. Some of those are domestic and some of them are close-by international ones.

In the past, you operated Embraer regional jets as well. What was the exact reason why they were in the fleet in the first place and why they were later removed?

Well, to be honest with you it was before my time so I can only guess at that one. I think it was one of those poorly thought-through decisions to bring in aircraft that had not been tested in a harsh environment. But we are finished with those aircraft; they are out of our fleet and I don’t see them returning. One of the things we are good at is being an A320 airline. So anything in the A320 Family would probably be something we would be thinking about in the future. We are looking to expand over time so that’s the way we would go. We are not going to mix our fleet again. We have no intention of becoming two and three different airlines.

Media reports suggest Saudi Arabia is planning to build high-speed railways on key domestic routes. Do you think that’s going to make a meaningful difference once they open, like the Madrid-Barcelona effect, or are distances in Saudi Arabia simply too great for them to have an impact?

It’s an interesting phenomenon because there are currently no trains there so I think they’ll be starting from scratch. They are fantastic projects in terms of civil engineering but in terms of the impact on aviation, I’m not entirely sure. There’s still far too many Saudis on the road in terms of driving long distances so I think that in all likelihood it’ll probably be the car journey that is the first to suffer rather than the airlines.

Thank you very much.

My pleasure.

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Founded in 2000, Astral Aviation is a Kenyan scheduled and chartered cargo provider operating throughout the country as well as throughout East as well as West Africa. ch-aviation caught up with founder and CEO Sanjeev Gadhia during the recent World Routes 2015 conference in Durban, South Africa

Learn about Astral Aviation on ch-avation:

Sanjeev could you please introduce yourself and give us a little background on who you are, how long you have been in aviation, and about Astral Aviation itself?

First of all I would like to thank you for the interview. I am Sanjeev Gadhia. I am the CEO and founder of Astral Aviation which is a cargo airline based in Kenya. We have been operating now for the last 15 years, which is a very long time for a private airline to have been around in Africa. My background is: I am from Kenya – born and raised. I did my studies overseas and I am actually a banker by profession. It is only by coincidence that I actually got into the aviation business as about 15 – 18 years ago, we were doing a lot work for the United Nations (UN) and the aid agencies where we saw strong market potential for the supply of aircraft specifically for the aid relief sector in Africa. So we acquired some aircraft and targeted the aid and relief sector and as time went by, we expanded our business to the other aspects of the aviation sector.

According to our database, Astral Aviation still operates the DC9 freighter. Is there a reason for that given their age?

Yes, we are probably the only freighter operator of the DC9. What we actually have is a very unique DC9 model which is a -34 freighter that can carry the same amount of cargo as the comparable Boeing 737-200Adv. But I think the main reason why we are still operating the DC9 is because of their overhead engines. At certain airstrips, it is actually ideal to have engines which are mounted much higher up on the fuselage because of the danger of ingesting gravel as well as other foreign objects.

Astral Aviation DC9-30(F) – Copyright: Astral Aviation

So, it is not only for economic reasons but operational reasons as well?

It is more for operational reasons but another thing is that when we acquired the DC9 about four years ago, the aircraft were available at a very good rate. We also had some crew who were type-rated on the DC9. Overall, the DC9 is generally a very, very good narrow-body aircraft which can carry up to 15 tonnes of cargo. It also has a very reliable dispatch rate. We really feel that it is a great aircraft.

In terms of operating cost, how do they compare to other narrowbody freighters in the same category? Is there a downside in that respect?

The operating cost is not as high as what you’d think compared with the same type in the Boeing family, like the B737-200Adv for example. It’s a really good workhorse and it works really well for us. In Africa we have not seen anybody else that has operated the DC9, but we like them. Also low fuel prices make the DC9 a very competitive aircraft to have in the region and we hope to keep them around for at least one more year.

Looking to the future, can you tell us more about your fleet renewal plans?

Well, we have been looking at the Boeing 737-300 and the -400 now for a while. However, a key problem is that the supply gap between the -300 and the -400 is getting bigger and bigger because the -400s are being snapped up by integrators. Consequently, demand for the B737-400 is really high and at the moment they have limited availability, at least for 2015. So what we have now decided is to go initially for B737-300 freighters of which a few of them are available. After that, we would have the option of going up to the -400 series. We have done a very detailed evaluation based on the routes we want to fly and because we have actually found that the B737-300 is more cost-effective compared to the 400, we are already in talks with three airlines over the possible acquisition of two aircraft over the next three to six months.

So the first is expected to arrive in the next three – six months?


Will it be a gradual phase-in or will the DC-9s be withdrawn from service there and then?

Yes, it will actually be a gradual phase-in. As I mentioned, the DC9 still has certain advantages in flying to airports with shorter strips as compared to the B737-300 which we would like to restrict to the larger airports we plan to fly to. Some of the destinations we plan to use the B737-300 to serve include Kinshasa and Lubumbashi in the Democratic Republic of Congo (DRC), Brazzaville in the Republic of Congo (ROC) as well as Lusaka and Ndola in Zambia.

Astral Aviation Boeing B727-200(F) – Copyright: Astral Aviation

Why those routes in particular?

Well because of their range, but we also feel the B737-300 is better suited to the characteristics of some of those markets we plan to serve. On the other hand, we feel the DC9 and the B727 will still do very well on our existing routes.

Tell us more about your B747-400 freighter ACMI lease with Atlas Air. How does that tie into your network?

Yes. The B747 with Atlas Air has proven to be a fantastic opportunity which we currently operate at a tri-partite partnership. We have three partners – Atlas Air, our UK partner ANA aviation who that are based out of London Gatwick, and then there is Astral Aviation. So we fly twice a week from Nairobi to London with perishables from Kenya. We then fly from London Stansted to Liege, which is our European gateway, and then from Liege we fly to Lagos and then back to Nairobi.

Did you manage to secure 5th or 7th Freedom traffic rights?

We actually have 5th freedom traffic rights out of Liege with our Nigerian partner Allied Air. Allied Air is actually a partner on the B747 and the MD-11.

How has the whole deal worked out for you so far?

Well the Atlas Air B747 freighter is a great aircraft. It is a nose loader and we are very happy with it. We are also very happy with our partnership with Atlas because they provide is with back-up aircraft, it is a very professional airline and we really could not ask for a better partner.

Given that Nigeria is an oil-dependent economy, have you seen any knock-on effects in recent months as a result of plummeting oil prices?

Yes, definitely. There has been a reduction in oil and gas industry-related cargo, but that’s been quickly substituted by a rise in demand for consumer goods. What has actually happened is that as soon as the [Nigerian presidential] elections were over, a lot of Nigerian businessmen began importing goods from China and Europe by air again. Prior to that, things had slowed down because of uncertainty about the future and the risk of possible civil disturbances. As Africa’s most densely populated country with a population of about 160 million people Nigeria has a very strong middle class as well as a very vibrant economy and so demand for consumer goods is there. Given these two factors, we have not actually felt any impact on our fleet or on our load factors into West Africa. In East Africa we are also seeing a surge in demand for perishable exports. The reason for that is the weak currency. For example, in Kenya, the Kenya Shilling has actually depreciated by 15% so has the South African Rand and the Nigerian Naira.

Astral Aviation DC9-30(F) & B727-200(F) – Copyright: Astral Aviation

So you are benefiting from that?

Yes. You see if you have a weak currency, it actually stimulates growth in exports. But it also makes your imports a little bit more expensive.

But is there an impact on your lease agreements with Atlas Air? I am sure your contracts are in US dollars.

Yes, but our income is also in US dollars.

So you are perfectly cushioned?

We are perfectly cushioned because all the perishables we export are billed in dollars and we actually meet our lease payments in dollars so we do not have problems there.

What is your market forecast for the future then?

Our forecast for Perishables’ growth out of East Africa this year is around 15% and this is purely because weaker African currencies have made products such as Kenyan flowers and Tanzanian fish and vegetables more competitive in Europe. I really see that over the next 6 to 9 months, we will see tremendous growth in exports. I believe we also need to be cautious because for example in Nigeria as the Naira gets weaker, we could, at some point, see a gradual drop in imports. We, however, hope it will be less than 5% of 2014 levels.

Sanjeev, in terms of your other operations, we see that you also serve Somalia. How has that been going and how has the Kenyan market been affected by the ongoing civil war there as well as Al Shabaab terrorist attacks on Kenyan targets?

Well the Nairobi-Mogadishu market is one of our best routes as we have a very nice contract to supply food to UN peacekeepers stationed in Somalia. In fact, we are actually planning to expand the frequency to two flights a week. In terms of cargo, we carry a lot of perishables to Somalia and we are the only cargo airline that currently flies to Mogadishu. We have cargo coming in from the US, China all consolidated at Nairobi and then we fly it all to Mogadishu. So Mogadishu is a route with a lot of potential. Aside from peacekeeper supplies and relief aid, there are also a lot of consumer goods coming into Somalia as well.

Are you considering perhaps any other towns there such as Kismayo, Beledweyne etc?

At the moment, no, because we feel the level of insecurity at some of Somalia’s secondary airports is still too high. Mogadishu is however a safe airport. We have fantastic turnarounds there and we have a very good Turkish groundhandler named Favori taking care of us. Recently we established an office at the airport as we are very committed to its long term development. Yes, in short, there are a lot of problems, but Mogadishu is on the up. The American embassy recently reopened, which is a very good sign, and we also have the Turkish embassy, the Chinese embassy and the UAE embassy. So we are seeing a level of confidence in the city which we have not seen before. And despite the fact there are pockets of problems that we experience in Mogadishu every now and then, I am very happy to note that the airport is very safe and we will continue to fly there for as long as we can.

Astral Aviation Boeing B727-200(F) – Copyright: Astral Aviation

We saw recently that one of your Fokker 27 freighters was recruited for use with Air Djibouti. Is the lease part of a larger partnership agreement or just a one-off?

Well we have leased the aircraft out to Air Djibouti for a period of 3 months but we are really hopeful that it leads to a partnership. We want to help them to grow their airline and at the moment we want to support them flying some of their routes. We have a lot of confidence in Air Djibouti Cargo. They are in the right location as I’m sure you are aware, Djibouti is the logistics hub for the UN in Yemen and is home to US and French military bases as well.

But do you not think that Djibouti’s proximity to Ethiopia and Kenya could lead to strong competition from established players such as Ethiopian Airlines Cargo and Kenya Airways Cargo respectively?

I actually feel that Air Djibouti has an advantage because they have access to markets such as Somalia and Somaliland as well as Yemen. A flight from Djibouti to Sana’a is only one hour 15 minutes and to Aden is only about 45 minutes. So we feel that by virtue of its geographical location, Djibouti, if they play their cards right, can actually become a strong competitor in the region. There are also a lot of exciting developments taking place in their Free Trade Zone as well as with Djibouti Ports and Airports. What Air Djibouti Cargo is doing is really capitalizing on the traffic-niche which requires smaller capacities. So I believe there is potential for Djibouti to develop into a mini-hub to compliment other larger hubs, such as Addis Ababa.

Astral has been a cargo operator since its inception in 2000. But recently, you signed an equity agreement with China’s Hainan Airlines to commence passenger operations. What is the status of that deal?

There has been a bit of deliberation with Hainan Airlines and its parent HNA Group. They have big plans for Africa as you are aware. They have an airline in Ghana – Africa World Airlines (AWA) – and they recently acquired a minority stake in South Africa’s Comair. While we have held talks in Nairobi, we have not yet completed a strategic plan on the way forward. In any case, we only expect to be in a position to determine which direction we are going at the end of this year.

Is your entry into the passenger market contingent on the signing of that agreement or do you have plans to go it alone?

We have been really fortunate because the license that we have allows us to operate both passenger and cargo services. And with a strong management team already in place, there is nothing that can stop us from operating scheduled passenger services. However, there are two important things to consider: the first, which I think is the most important, is to have access to working capital which can actually support a passenger network because a Low Cost passenger carrier’s business model is very capital intensive – more so than cargo we feel. Secondly, there is need for a strong partner to make passenger operations work.. So to answer your question, our entry into the passenger market will only occur once we have a strong partner that has experience in passenger operations. We are not in a hurry to get into the passenger business as despite the fact it’s been 18 months since we signed the MOU with Hainan Airlines, we already have a very good business model, which is based on cargo. If it is going to happen, it will happen, if it is not going to happen life will still go on and we will continue to haul freight.

Astral Aviation Fokker 27(F) – Copyright: Astral Aviation

Here in Africa, we hear passenger carriers complaining about difficulties in securing bilateral traffic rights to countries around the continent. As a cargo operator, do you encounter the same obstacles?

Well, on the cargo side, it is more difficult because historically a lot of the bilateral air service agreements were based on a set model which viewed passenger and cargo rights as one and the same. But we have been lobbying the African Airlines Association (AFRAA) to have a separate set of rules for cargo and in many developed markets like South Africa, Nigeria, Egypt, Ethiopia, and Kenya there already have separate agreements for passenger and cargo rights. In all, I would say the biggest challenge we have in Africa is market accessibility. There are a lot of markets in Africa that are closed. Africa is a continent of 54 countries and I would actually say very confidently that at least a third of them are still not open while the remaining two thirds are open or fairly open. But for Africa to achieve its true potential we need full liberalization and there are some good initiatives taking place under the auspices of the African Union (AU) to this end. In April this year, eight countries got together and agreed to implement a more hybrid version of the Yamoussoukro Declaration (an AU-endorsed document for the liberalization of access to air transport markets in Africa) by 2017.

They actually committed themselves to opening up their markets, but only to each other or to Africa as a whole?

To each other and within Africa. There was a study done by IATA through a consultant called Intervista where they looked at the positive benefits of liberalization in 12 countries and they actually found that liberalization would benefit the market through lower fares and better connectivity. The African Union is also working on a continent-wide Open Skies agreement which would in essence be a more hybrid version of thee Yamoussoukro Declaration. The other very good thing is that trading blocs such as COMESA (The Common Market for Eastern and Southern Africa), ECOWAS (Economic Community of West African States), and SADC (Southern African Development Community) are beginning to open up to each other. Should it continue, it will greatly improve intra-African trade and thus Africa’s ability to solve its own problems as opposed to relying on the United States, Europe, and China where there are always strings attached.

Where do you see Astral Aviation in ten years time?

We actually have a very big strategy to expand Astral Aviation over the next 5 years, which will take us into West Africa and into Southern Africa. We are setting up a hub in Lagos and we also have big plans to set up a hub in South Africa and at the moment we are looking at Johannesburg and Durban. In particular, we are excited about South Africa as a potential hub for southern Africa because a lot of countries there like Madagascar, Mozambique, Zambia, Zimbabwe, Angola, and Malawi rely on Johannesburg. But all this will occur in 2016 as we are still in the process of setting up a hub in West Africa.

So that will take you head to head with Ethiopian Airlines which already has a hub in Lome (Togo)?

We respect Ethiopian Airlines because of their status as a national carrier, but we also feel that we still have an opportunity because we are a privately-owned airline. As a private carrier we have certain advantages that allow us to be more pro-active, and more focused on the routes we want to fly. In addition, we also want to focus on a sector which Ethiopian Airlines is not in and that is the 15-20 tonne category. This is where the B737-400 comes in as Ethiopian’s market segment is 35-100 tonnes. So in all, we have a unique opportunity of having our own footprint while at the same time not stepping on anybody’s toes. But, at some point in the future, we will have to collaborate on common routes with Ethiopian Airlines to a greater extent than what we are doing now.

Thank you so much for the interview.

My pleasure.


Learn about Astral Aviation on ch-avation:

Having been involved with Safair in various roles over the past ten years, Elmar Conradie was appointed CEO of the South African ACMI/charter specialist this year. Founded in 1969, Safair is a subsidiary of the Ireland-based airline group ASL Aviation. However, in 2013, Safair made the decision to enter the scheduled South African passenger market through its Low Cost Carrier unit, FlySafair. The LCC’s journey from drawing board to reality was not easy as just prior to its original October 2013 launch date, FlySafair was grounded by a court order following rival Comair’s concerns over its ownership structure. Over the course of the ensuing twelve months, FlySafair’s shareholding was revamped culminating in its eventual debut in October 2014.

ch-aviation’s Chief Commercial Officer Max Oldorf was in Johannesburg recently and had the chance to chat to Elmar Conradie about Safair’s current operations, challenges, and future plans.

Learn about Safair and FlySafair on ch-avation:

FlySafair: Airline Information | Aircraft and Fleet List | Recent News
Safair: Airline Information | Aircraft and Fleet List | Recent News

The first question is obviously about your history: Do you think it was worth waiting so long for your launch approval?

Oh yes, absolutely. I think the challenges that we had with the license just made us more determined to actually make it. Furthermore, I think the extra year that it took to go live with our website and start flying gave us a lot of time to rethink several matters before going to market – ‘Is this the right approach?’ ‘Is this the right business model?’. If you compare our product from when we tried to launch the first time with our current offering, quite a few things have changed. We made quite a number of revisions to the business model in the 12 months it took us to regroup.

Whom do you think profited the most from the long court battle?

Obviously the existing local carriers all benefited from it. It is difficult to say who benefited most because they all did. To put this into perspective, since FlySafair launched a year ago, we have saved South African consumers R614 million in airfares as the market adjusted pricing to compete.

FlySafair Boeing 737-400 in front of the Table Mountain – Copyright: Safair

What lead you to venture into the scheduled market?

We have been providing ACMI to scheduled airlines domestically and regionally for quite some time now. We also helped start up and maintain some of the local carriers by providing them with their initial aircraft, backup aircraft, training, pilots, etc. We’ve always operated on two principles: we don’t take risks with load factors and we don’t take risks with fuel. But what happened was that each time an airline went under, we were exposed – they owed us money in the form of outstanding ACMI bills that they couldn’t pay. Adding to that, actual ACMI contracts became harder to come by with airlines preferring to use theirown aircraft. So the next natural step for us was to say, ‘Listen, we take the risk anyway on these local airlines. We’ve been doing this for 48 years now and all we need to do is just to sell the ticket.’

The South African domestic market is a very tough one and carriers like 1Time and Velvet Sky have come and gone. So what is different this time round with Kulula, Mango, Skywise and FlySafair battling it out and Fastjet and FlyAfrica wanting to join in?

I think it’s difficult to isolate one particular reason as to why other airlines failed in the first place – it’s never just a single cause, it’s usually a combination of causes. It’s similar to when you succeed: it’s not just one factor but a whole list of things that allow you to succeed. Obviously the fact that we are not a start-up in the purest sense i.e. we don’t have to carry all the overheads and costs of establishing the business, helps. We all know that you aren’t going to start an airline and make a profit in the first year – that just doesn’t happen. But, if you start an airline with the support of an existing business, it makes it a lot easier to swallow the overheads and costs you have to incur, so that is definitely one benefit. Another aspect to consider is that early on, we took a long hard look at other cases and decided that if we do make a go of this, then we cannot do it halfheartedly. We aren’t just going to operate one or two aircraft and see if it works – No. We’re going to go full out and that is why we already operate five aircraft with a further three B737-800s to arrive by year-end. So we are really focusing on achieving economies of scale as quickly as possible so that we can get our cost per seat down.

You just mentioned the Boeing 737-800 is due to join your fleet shortly. Will they be replacing the 737-400s or are they there to enable more growth?

The immediate plan is to actually phase out the -400s and replace them with -800s in order to reduce our costs. I think we will keep a few of the -400s around as backup aircraft and maybe to cover seasonal demand – we have not yet decided on their future. For the two that we do own, we’re considering either selling them or converting them into freighters for use within the ASL Group. As I said, while we may keep the -400s around to cover seasonal/ACMI demand, you have to realise that the capital costs on the -400s are not that high anymore and the two that we own are paid off. It’s not like a leased -800, which absolutely has to fly.

New seats in the Boeing 737-800 – Copyright: FlySafair

Where do you want to be in five years’ time in terms of fleet size?

Fleet wise, I’d like to be where Kulula and Mango are, around that size. Ten to eleven aircraft domestically and if we then start flying regionally maybe some more

Do you think there will be a consolidation in the South African market? After all, it is one of the most competitive environments in the world.

It’s difficult to say if it’ll be a consolidation or someone simply falling out of the market. There is just too much capacity now. If you look at JNB-CPT – one of the busiest routes in the world – the capacity added since 2011/2012 has been tremendous. There are millions more seats in the market now on that route alone. If you look at the South African market as a whole, there was a period after 1time and VelvetSky collapsed when capacity was static. And it took a while for Mango and Kulula to increase their capacity. In retrospect, it would have been better for us to have launched operations a year earlier because the market was not as flooded with capacity as it is now.

So what do you think is the growth limit in terms of the domestic market?

I think growth at this stage is limited by the economic growth of the country and South Africa’s GDP growth has slowed down a little bit. Capacity in the market, at this stage, is growing much faster than demand so I see that as a real limiting factor. In all, I do not think growth in the South African market is limitless. Like I said, I don’t see us getting much bigger than a Kulula or Mango in the domestic market.

So you’re looking to take market share from them?

No. What I am hoping is that over the next decade the South African low-cost market will grow and there will be enough demand for maybe 30 aircraft. What is happening right now is that capacity is growing faster than demand so we will all have to wait for demand to catch up. Because of this, we aren’t planning to undertake any major expansion in the near future.

How have the established carriers reacted to your market entry? How have they tried to run you out of town?

A study done by an online travel agency showed competitors’ fares for routes where we operate have dropped by 39% since we entered the market. In addition, following our announcement of flights to East London and Durban in August, we have seen very, very aggressive pricing from both Kulula and Mango as we are all matching each other’s fares.

But the question to ask is will they keep on adding capacity? Well I guess it depends on how deep their pockets are as there is no demand for it right now. Obviously you can add capacity but you aren’t going to fill the airplanes right at the moment.

And how do you position yourself? Usually low cost carriers just go on a price differentiation.

Well while price is the key to any low-cost model, it can’t be the only thing you differentiate on. For example, if we drop our price, Mango matches it and they do it with any price we put on sale. So we really try to focus on other things such as on-time performance and this year we have been the most punctual airline out of Johannesburg and the second out of Cape Town. I think we’re considerably better than other LCCs in that respect. We also try to find ways to make travel more convenient by trying to smooth out the entire process of flying.

Low-cost carriers all over the world generate a lot of revenue through ancillaries. How far have you taken this?

Ancillary revenue is big for us. We were the first airline to completely unbundle our fares in that you pay for your bag, you pay for sports equipment, you pay for SMS confirmation, you pay for a preselected seat and you pay for insurance. You basically pay only for what you want. An interesting stat is that only about 50 percent of our passengers actually opt to take a bag.

So are you planning to go international?

Maybe regional. It’s something we’re looking at and I think it’s something that all airlines in Africa are looking at as well. I think anybody that says they aren’t looking at flying regionally is probably keeping something under wraps because everybody believes that is where the growth is. Everybody sees the potential for growth in Africa given the huge population and that is particularly appealing to a low cost business model. But I think one major issue is the lack of open skies agreements which curtail where you can fly to. You can’t just pick a destination and start flying there – you need to be allocated traffic rights.

Also, you need to pick your market carefully and establish where there is actually enough demand – a lot of regional flying works on business class seats and two- and three-class configurations. A Low Cost model on the other hand requires a route where there is high demand to generate the necessary minimum of 70-80% load factors. Also in southern Africa you have to pay more attention to distribution as there are far fewer internet users than say in Europe.

In other regions we have seen other Low Cost Carriers such as Nok Air and Spicejet venturing into the regional aircraft market with high-density Q400s capable of carrying 80 passengers. Do you have any plans to operate aircraft smaller than the B737?

Not at this stage. It is not something we’re looking at at this point in time but I can say we have looked at the ATR for our ACMI operations. In any case, there are actually several routes where smaller regional jets compete with a B737 with 189 seats but also routes where there are currently only smaller planes in service. Demand aside, on such routes we would rather fly our Boeing as opposed to using a regional aircraft as we can keep our unit cost down.

Regional budget operators such as Fly Africa and Fast Jet have been setting up joint ventures all around Africa in order to gain additional market access. Is that something Safair has considered?

We have considered it and we’re looking into it but we do not have any immediate plans to partner with any other companies at this time.

Are you planning to cooperate with other airlines and set up code-share and interline agreements? A lot of people transfer in JNB but they actually only have one airline to choose from if they want to have one ticket.

As a budget operator, you have to adhere to the confines of your business model and in our case, quick turnaround times are a critical component. However, that wouldn’t work with codeshare or interline deals as they rely more on convenient connection times. But that isn’t to say we aren’t open to the idea. While we would be open to co-operation, we would only invest in the necessary IT infrastructure and so on if we saw a real advantage for us. But for the moment, no.

Safair has been very active in other markets such as cargo, ACMI and special ops like flying for the United Nations. So which segments from your legacy business are still growing and what percentage do they contribute to your overall business?

Well our operations still make up half of our total business. In fact, in terms of fleet, it is the biggest because it has a total of nine aircraft. Unfortunately, it is very difficult to find suitable aircraft to meet our fleet expansion needs – the Lockheed Hercules is one example. We would like to grow our fleet with them but they are difficult to find. In fact, you might have seen the announcement that ASL is looking into the latest version of the Hercules – the L100J – but it still needs to be certified for commercial use and it is a much more expensive aircraft to operate. We actually did grow our “legacy” fleet recently by adding B737-400 Combis, which are working out very nicely for us in Africa. We have seen big demand for them there because you often have flights which require freight in one direction and passengers in another.

Safair Lockheed Hercules – Copyright: Safair

What are market conditions like for a capacity provider in Africa?

For us there’s a split – there’s the specialised work we do with the Hercules and the Combis, which still does very well. But the provision of back-up aircraft to other airlines or offering additional capacity on an ACMI basis to airlines is a very difficult niche to make work. Contracts in that segment are usually very short-term – when an airline has an aircraft undergoing a check or when they want to explore new route options – so it’s not easy. But on the other hand, for specialised aircraft you can find long-term ACMI contracts with organisations like the World Food Programme, the United Nations, and the Red Cross.

What are you future plans in terms of business diversification?

Basically we want to grow both businesses. We’re still looking at growing our legacy ACMI business but again difficulties in sourcing specialised aircraft like the Hercules and others are a limiting factor. In terms of FlySafair, I think the immediate desire is to settle down with the -800s. I don’t, however, think we’ll grow that fleet in the next year.

Overall, the game plan is to grow both businesses but if one should naturally overtake the other, well then so be it.

Thank you very much!

Learn about Safair and FlySafair on ch-avation:

FlySafair: Airline Information | Aircraft and Fleet List | Recent News
Safair: Airline Information | Aircraft and Fleet List | Recent News

Announcing record first half year profits of EUR 4 million at a press conference, Small Planet Airlines announced plans to invest its higher profits in increasing passenger comfort on its fleet of A320-200 aircraft, its largest investment into fleet renewal in the carrier’s history. Small Planet has ordered 3000 new seats from Recaro and will equip its fleet with LED lighting, Economy Premium seats with more leg room and AirFi streaming in-flights entertainment to customer’s devices. With its German subsidiary launching operations in spring 2016, Small Planet plans to operate twenty A320-200 aircraft next summer season across its three airlines in Lithuania, Poland and Germany. Small Planet is also in the process of obtaining an air operator certificate in Thailand.
ch-aviation’s Thomas Jaeger had a chance to sit down with Vytautas Kaikaris, the Chief Executive Officer of Small Planet Airlines, on the terrace of his carrier’s new headquarters in the city center of Lithuania’s capital Vilnius.

Learn about Small Planet on ch-avation:

Small Planet Airlines: Airline Information | Aircraft and Fleet List | Recent News
Small Planet Airlines Polska: Airline Information | Aircraft and Fleet List | Recent News
Small Planet Airlines Germany: Airline Information | Recent News
Small Planet Airlines Thailand: Airline Information | Recent News

So you’re obviously growing very fast. What are the key drivers behind your growth in the European market and what have been the biggest challenges for you personally and for the company?

Our biggest growth has been in Poland which is where we have grown the most. This year, we operated eight aircraft plus a standby unit in Poland and that constitutes about 60% of our total revenue. So why are we growing so fast in Poland? Well I think it’s a combination of a few things. First, it’s still very much a developing market with natural demand which we have satisfied. We also came at the right time when a lot of weaker competitors were going out of business and there were a number of bankruptcies. As such, I think tour operators were very much in the hunt for reliable partners capable of providing good quality service for the long term, and not just a one-off as has happened in a number of cases. So I think we have established good relationships with tour operators whose growth requirements we were able to satisfy. In other markets such as Western Europe, I think our unique selling point against our competitors there is our lower cost structure. Obviously it helps coming from countries like Poland and Lithuania where labor costs are not as high as they are in Western Europe. Overall, this helps us to offer a very low unit cost wherein our CASK is one of the lowest in the industry. The way we are able to achieve that is because our utilization is quite high and it is getting higher because of the Asian ventures we have in the pipeline. Instead of keeping our aircraft parked, we are utilizing it and obviously that helps drive our total unit costs down. This allows us then to offer more competitive pricing and gives tour operators the incentive to choose us over the rest. In fact, if you look at the European charter market, operators from Eastern Europe have been gaining a significant amount of market share. When you combine us, Travel Service and Enter Air’s market share you’ll see we are now among the main charter operators in Europe.

So for you right now, tour operators are your key source of revenue. But you also do ACMI operations in winter. From a revenue perspective, how dependent are you on ACMI revenue and how does it contrast to other Baltic operators such as Avion Express and SmartLynx where it’s the exact opposite of what you’re doing?

We have chosen to pursue a different strategy wherein we are predominantly a full-charter business. This means we have our own call signs and our own customer experience. In summer, 100% of our operations are on a full-charter basis – we do zero ACMI. But ACMI operations, though a small part of our business, are still important to us because they mainly occur during winter – the low season. Last year, I think our Asian ACMI operations made up about 4% of our total revenue. So obviously, there is still a lot of room to grow.

You mentioned Asia before. Again comparing you to Avion Express, which is another Lithuanian operator, why did you chose Asia over the Caribbean like they have done?

We just divided the globe (laughs). No but seriously, I suppose Avion had some connections in the Caribbean and it worked out for them there. We on the other hand, established good relationships with partners in Asia and so for us, we see our future down there. So to answer your question, they looked West, we looked East.

Obviously as you grow your fleet, the winter problem becomes more pronounced. At present, you have a deal with Cambodia’s Sky Angkor for several winter seasons which protects you from competition there. But you have been struggling In Thailand as a result of external factors. When do you hope to be up and running and what is your take on the situation in Thailand given the ICAO’s recent imposition of a Serious Safety Concern against the country?

We knew that setting up in Thailand would be a long process but we didn’t expect it to take this long! As you say, there have been these external factors which have dramatically impacted the situation and prolonged it. As such, in November we expect to get an update on the way forward with the ICAO matter and we hope that everything will be resolved. We hope then that the Thai Department of Civil Aviation (DCA) will begin issuing licenses again. But even if things get going, it’s difficult to tell how long the whole process will take. Usually it takes 6 months to a year but in this case we simply do not know. In the interim, we are also looking at partnering some existing operators as that would be a ‘shortcut’ into the market minus the red tape. However, we also have to be careful whom we partner and under what conditions given that a lot of Thai operators are in a lot of trouble.

In Poland you’re competing with other Eastern European charter operators such as Travel Service and Enter Air. Have you considered other markets in the region or is your main focus to expand into Western Europe where there is less direct competition?

That is exactly right. We are already in a strong position in the Lithuanian and Polish markets and we intend to consolidate if not expand that position, especially in Poland. But with our entry into the German market next year, we will then be present in three of Europe’s Big Four markets – the United Kingdom, Germany, France, and Italy. While we did have a contract in France, that was two years ago and we will consider returning there in the future. But basically, we are busy addressing market needs in areas we already operate in as well as those we intend to enter – Germany in this instance. As for the Central European market like the Czech Republic or Hungary, while we have looked into them, we feel they already have strong players there such as Travel Service, which is a very well established brand. As such, we see no reason to compete with them in their home markets in the same way as we see no reason for them to enter ours. In all, our target market is Western Europe where we intend to compete with existing operators there.

Your next market entry is Germany. Why there and are you not afraid of being used by TUI and Thomas Cook to undercut others?

We were in a similar situation with leading tour operators in Poland but look what we have achieved. So we know what to expect and we don’t see why we shouldn’t be able to repeat the same success in the German market which is vastly bigger. Yes it is dominated by a few strong tour operators there but with our competitive cost structure, the size of the market, our very competent management team, and our partners we see a real opportunity there.

Travel Service recently took on Chinese investment. Are you looking for similar opportunities to provide you with added financing thus allowing you to more rapidly expand?

Obviously we’re looking at all available options. We have looked at going public (IPO) but have yet to decide on anything. Alternatively there is the possibility of taking on-board a private equity investor. But, in all, we have raised sufficient capital from our operations to finance our current growth requirements. Of course, if we decided to venture into the scheduled services market or to acquire aircraft and perhaps even other airlines, we would then definitely require either IPO or private equity funding. But no, no firm plans have yet been made.

Thank you very much!

Learn about Small Planet on ch-avation:

Small Planet Airlines: Airline Information | Aircraft and Fleet List | Recent News
Small Planet Airlines Polska: Airline Information | Aircraft and Fleet List | Recent News
Small Planet Airlines Germany: Airline Information | Recent News
Small Planet Airlines Thailand: Airline Information | Recent News

Founded over 20 years ago in Germany, Avanti Air is a well-known player within the ACMI charter market. The airline has operated turboprop aircraft since its inception but has recently introduced a first jet aircraft.

Max Oldorf talked with Managing Director, Stefan Kissinger about the current state of the charter market, the history of the company and their new Fokker 100 jet.

Avanti Air – Airline Information

Avanti Air – Aircraft and Fleet List

Avanti Air – Recent News

While Avanti Air has been an ACMI operator specializing in turboprop aircraft for the last two decades, you recently introduced your first jet aircraft – a Fokker 100. As such, how do you think the European wet-lease market for turboprops will pan out in the longrun?

The European aviation market has become a very tough environment making it very difficult to operate smaller aircraft as they require higher airfares. As a result, in recent years, many regional routes have either been discontinued or the equipment used has had to be upgauged. But despite this, there are still some niche markets, for instance in Scandinavia or between islands, where turboprop aircraft will remain in demand in the future.
However, the overall outlook is not good. Reacting to this trend, we decided to acquire a jet in order to help establish a second pillar for our business. In total, it took around eight months from the idea’s conception to the Fokker 100‘s entry into revenue service.

Avanti Air Fokker 100 at Saarbruecken Airport – Copyright: Avanti Air

Did you consider any other aircraft beside the Fokker 100?

Besides the Fokker 100, we also considered the Embraer E-Jet.
While on one hand it definitely offers better fuel efficiency and lower maintenance costs than the Fokker, on the other its capital costs are obviously much higher.
Since we only intend to use the jet for ad-hoc and charter services, we won’t likely reach the required utilization that would make a Embraer E-Jet a better option. We therefore decided to settle on the Fokker 100.

The keyword you mentioned there is “utilization”. When would an Embraer E-Jet make sense?

The Embraer would be a better option if we were to ply minimum of around 2,000 flight hours per year. However, in the market we are targetting, it’s not unusual to be inactive for periods of four to six weeks in a row, making it nearly impossible to attain those 2,000 flight hours.
Another advantage of the Fokker 100 is that maintenance provider Contact Air Technik, which specializes in this aircraft type, is located in Saarbrücken which is very close to our home base.

Avanti ATR 72-200 infront of its Hangar at Siegerland Airport – Copyright: Avanti Air

Did you consider the Boeing 737 or the Airbus A320 as potential options at all?

We actually considered them in the beginning but we soon realized that they wouldn’t be viable options. You see, the market is flooded with Eastern European carriers operating those types of aircraft at very low costs. We, as a German airline, are simply not be able to compete with East European carriers offering ACMI rates for a B737-800 at less than €2,000 ($2,200) per hour.

Avanti Air recently underwent rebranding. Is it important to invest in a corporate identity as an ACMI/charter airline?

While it isn’t absolutely necessary, it is certainly valuable. Our website really needed an overhaul and our corporate identity was no longer up-to-date. So, we decided that alongside the acquisition of our Fokker 100, we would also refresh our image and look.

Avanti Air ATR 72-200 at Koh Samui airport, operating for Bangkok Airways – Copyright: Avanti Air

What lead to the establishment of Avanti Air more than 20 years ago?

Well, Markus Baumann (Avanti Air’s second shareholder) and I originally worked as pilots before we decided to go independent.
We started off in 1994 with a share capital of just 50,000 Deutsche Marks with a business model that offered aircraft management to aircraft owners – the first ones to do so in Germany at the time. Though we started off with a single Piaggio Avanti and one Beech King Air, we soon expanded our business.
Our customers mainly used the aircraft for internal factory shuttles and a big advantage for them was that they could save fuel tax due to legal loopholes.

And soon you expanded operations with a first aircraft operating your own venture…

Our aircraft management model developed quite quickly back then. Before long, it had reached its peak where we were then taking care of up to ten aircraft including Learjets and Hawkers.
We subsequently began to operate our own aircraft. The first one was a Beechcraft 1900C followed by a Beechcraft 1900D both of which were used by Phillips and other companies. We financed the planes through a bank loan.
A very important contract was the one from Britannia Airways. Back in those days, they were just entering the German market and did not operate any fixed bases which led to excessive crew downtime. They then engaged us to operate crew shuttles with our Beechcraft 1900 fleet. To satisfy the increased demand, we introduced another Beechcraft 1900D. All in all, we sold around 1,200 flight hours per year through the Britannia contract.
Furthermore we relocated from Frankfurt to Siegerland Airport where we were offered a hangar. Today, it is still used for minor maintenance work.

Reception in Munich for some members of the German national football team after the won World Cup in Brazil – Copyright: Avanti Air

The heydays of the Beech 1900s are long gone and you have now transitioned to ATR aircraft. How did that come about?
The best time for the Beechcraft 1900 was during a brief period post 9-11 when a lot of companies tried to avoid scheduled services by arranging private flights for their employees. Back then, we flew almost exclusively for Microsoft and they paid very well. However, when all the hype died down, the market for Beechcraft 1900Ds began to slowly disappear and so during the early 2000s, we began operations with ATR aircraft.
Our first ATR was sub-chartered out to DAT Danish Air Transport and flew freight between Rönne, Copenhagen, and Aalborg from 2002 to 2003. After that contract ended, the ATR sat idle for six months. We were considering selling it off when finally we got another sub-charter contract – this time from Meridiana for flights out of Lampedusa and Pantelleria. The contract was soon extended, and so we acquired a further two ATRs of which the second was used for cargo flights between Paris and Warsaw on behalf of FedEx before it entered into service in Southern Italy as well.
In 2008, we won another ACMI contract in Italy – with FlyOnAir from Pescara. With the resulting growth in demand, we therefore had to acquire a fourth ATR.
However, in 2012, things began to change and our ATR ACMI business that had proven so successful in the years before slowed down dramatically with the loss of the Meridiana and FlyOnAir contracts. While we were able to secure new deals with Air Berlin and Darwin Airline for brief periods, we were not longer able to make use of all the capacity we had available. So, after having sold our Beechcraft 1900 fleet in 2007/8, we then began to dispose of our ATR fleet.
But, as luck would have it, we actually discovered that we had a knack for aircraft trading and so we moved to acquire more ATRs in order to resell them.

Has Avanti Air ever considered venturing into the scheduled services market on its own?

No. We have never offered scheduled flights and currently, have no intention of doing so for the foreseeable future.
A lot of people think that we did venture into the market in the early 2000s when we offered flights out of our Siegerland base, but in actuality they were operated on behalf of Rheinland Air Service and were supported by local subsidies.
However, two years ago we did give the move some consideration when a tender for scheduled services from Pantelleria and Lampedusa was flighted. As I mentioned, we had operated those flights for several years on behalf of Meridiana and were therefore very experienced with their operation. In addition, the increased subsidies made them a very attractive proposition but in the end, the tender was awarded to Mistral Air

Avanti Air ATR72-200 at Nouakchott/Mauritania during Paris–Dakar Rally – Copyright: Avanti Air

Would you ever consider venturing into the ACMI market abroad, for example, on another continent?

We could imagine operating abroad but we would only accept contracts where the security of our aircraft and crew are guaranteed. Some of our competitors operate in Libya, South Sudan and Pakistan and while we too should be able to obtain contracts there, we do not apply owing to safety concerns.

Thank you very much!

Avanti Air – Airline Information

Avanti Air – Aircraft and Fleet List

Avanti Air – Recent News