NAIROBI, Kenya
Troubled Kenya Airways (KQ) and South African Airways (SAA) have partnered to help shore up their battered revenues.
They
signed a memorandum of co-operation on Tuesday aimed at forming a pan-African
airline.
Kenya
Airways CEO Allan Kilavuka said in a statement Tuesday that the mutual
co-operation between the two struggling carriers would help in turning around
their fortunes.
“The
future of aviation and its long-term sustenance is hinged on co-operation. KQ
and SAA collaboration will enhance customer benefits by availing a larger
combined passenger and Cargo network, fostering the exchange of expertise,
innovation, best practice, and adopting home-grown organic solutions to
technical and operational challenges,’’ said Mr Kilavuka.
He
said the loss making national carrier, which is a subject of state takeover,
remains committed to its financial turnaround strategy with pursuit of
partnerships being one of its core strategic pillars.
SAA’s
interim Chief Executive Thomas Kgokolo said the cooperation between the
two airlines, which includes demand recovery and other cost containment
strategies, will aid recovery of both carriers in an increasingly competitive
African airline environment.
“It
will also enhance related Kenya and South Africa tourism circuits, which
sectors account for significant portions of respective country growth domestic
product, benefiting from at least two attractive hubs in Johannesburg, Nairobi
and possibly Cape Town,” he said.
“KQ
and SAA, as iconic airline brands of Africa’s biggest and vibrant economies, in
East Africa and Southern Africa, respectively, are at the precipice of what
could be Africa’s formidable Pan African airline.’’
KQ,
which has forecast a grim full-year performance due to the effects of the
Covid-19 pandemic, made a net loss of Ksh11.48 billion ($104.36
million) in the six months period to June 30, 2021, down from a
net loss of 14.32 billion ($130.18 million) in the same period last year.
The
persistent underperformance of the airline has led to huge losses and loss of
market share to rival firms.
As
a result, the government has opted to nationalise the carrier by buying out the
minority shareholders with hopes of turning around its dwindling fortunes.
On
the other hand, South Africa’s embattled national carrier emerged from
bankruptcy last week, flying its first plane in the last 18 months. It has not
been operating flights since March 2020.
The
passenger plane flew from Johannesburg to Cape Town on September 23.
According
to Aljazeera, SAA, once Africa’s second largest airline after Ethiopian
Airlines, had survived for decades on government bailouts and was shedding
routes even before the Covid-19 pandemic struck.
The
government agreed in June to sell a 51 percent stake to a group of investors
called the Takatso Consortium, opening the way to a potential injection of $200
million.
Even
after a state bailout of more than $500 million and a restructuring of its
debt, the airline only emerged from bankruptcy after slashing hundreds of jobs.
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