New markets will expand cargo options
ALLIANCE AIR, the joint venture between South African Airways and the governments and national airways of Uganda and Tanzania, is to introduce a new regional service into Africa under the name of Alliance Express.
The service is to take over the operations of Air Rwanda, which is going into liquidation. Alliance will launch the new service with the government of Rwanda and will pay Air Rwanda $900 000 for its ground handling services at Kigali, which will be operated by Alliance Express.
Alliance Air currently flies to London via Dar-es-Salaam and Kampala, and Kampala's airport of Entebbe is to be used as a hub to rival Nairobi. The airline's senior marketing manager, Fanie Brand, is based in the Ugandan capital.
Alliance flies under an SAA flight number to Dar-es-Salaam at present for political reasons, and then continues its route through Kampala to London under its own name.
According to Albie Smith, Alliance Air's manager, South Africa, it will make a significant impact on cargo operations into Africa, with new areas to be serviced in this respect.
He says, however, that plans to expand the existing route network into Africa may bring them into conflict with Kenya Airways, whose strategic equity partner, KLM Royal Dutch Airlines, has a strong growth policy into Africa.
Alliance, he says, has also abandoned plans to merge with Uganda Airlines and Air Tanzania in the face of resistance from both airlines.
Alliance, after incurring starting losses of $18 million, is expecting to break even at the end of the first quarter of this year, and is planning positively towards future growth, says Smith.
On the cards is a proposal to fly to Dubai, but this had met with strong resistance from Air Tanzania, whose Dar-es-Salaam to Dubai route is a profitable one. At the same time there is a possibility that KLM might buy into Uganda Airlines which is to be privatised this year.
Uganda Airlines and Air Tanzania each hold 10% of Alliance, and there are no plans to change the shareholding, says Smith.
SAA has 40% of Alliance and the airline's sole aircraft in operation at present is a Boeing SP 747 leased from SAA.
By Leonard Neill
