East Africa’s three biggest airlines have fallen on hard times, with the flag carriers of Kenya, Uganda and Tanzania all facing the dire portents of a growing gap between revenue and running cost for years to come.
Uganda Airlines (UA) in particular is facing a cliff of sorts as the carrier has recorded year-on-year losses that are well ahead of projected earnings, coming in below operational expenses.
For the previous financial year (2020/21) that projection was 37% underestimated when the airline posted losses of $43 million.
Its execs are currently facing a rigorous parliamentary probe in Kampala, and the airline is expected to be 53% off target when its next set of results are posted.
The launch of an intercontinental flight to Dubai and a sharp rise in fuel costs have been cited as some of the primary reasons for UA’s flagging fortunes.
Its CEO, Jenifer Bamuturaki, said it would take a while before the new service became profitable.
The government of Yoweri Museveni has, however, has made no secret of its displeasure at the airline, which is only operating half of the 21 routes on its network.
Considering that running costs are expected to increase by 38% in 2023, AU is not expected to pull out of its nosedive any time soon.
Kenya Airways also finds itself in a spot of bother, having suffered losses of $82.4m for the period ending in June.
Previously that loss was $95.8m for the same period.
The airline has now posted half-year losses for nine years in a row, requiring bailout after bailout from the state – the latest being $116.7m.
Air Tanzania, on the other hand, dreams of flying high, with network expansion to West African destinations such as Lagos and Accra.
Compared to its peers, the airline has only lost $64.6m over a five-year period, and despite plans to add four newer aircraft to its aging fleet of Fokker 50s and a couple of Boeings, seems to be incapable of recovering from the blows it suffered under Covid-19 lockdown regulations.
