Kenya Airways to revive long-shelved expansion plans with 10 Boeing aircraft buy
Chukwuemeka Obioma is Businessamlive Reporter.
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Kenya Airways Plc. has proposed to buy up to 10 Boeing Co.737 Max aircraft, a move which if successful will revive its long-shelved plans to expand its network over a five-year period.
The move comes on the back of three consecutive years of losses caused by what analysts described as a poorly executed expansion strategy and fuel-hedging contracts that saw it miss out on rock-bottom oil prices; a situation which compelled the company into adopting austerity measures that included job cuts, a 15 percent fleet reduction and the abandonment of an expensive but valuable landing slot at London’s Heathrow Airport.
Jan de Vegt, Kenya Airways chief operating officer, told a gathering in Nairobi, Wednesday, that the company had to momentarily put out proposal for 10 aircraft, adding that the airline will introduce the aircraft within the space of 24 to 36 months. There is also an indication that this will be ample time to prepare pilots for the task ahead.
“We’ve put out a proposal for 10 planes at the moment…”We will then have to take two to three years at least to introduce them. You have to train pilots,” de Vegt said.
Kenya Airways, which currently stands as Africa’s third biggest carrier, servicing mainly routes on the African continent, is partly-owned by Air France-KLM.
Information available to business a.m. reveals that the airline’s fleet includes two Boeing 787 Dreamliners and three Boeing 777-300 aircraft that are sub-leased to Oman Air Transport and Turkish Airlines respectively. Industry sources reveal that Kenya Airways intends to take them back between September 2018 and December 2019.
de Vegt also says the current fleet is insufficient for the new routes the carrier plans to take up. The airline will begin direct flights to the U.S. on Oct. 28 2018.
Also branded as KQ, Kenya Airways which last November, successfully executed a reorganization project that saw its stake rise to 48.9, courtesy of the country’s leadership, according to the company’s annual report, may rest its Boeing 737-300 aircraft after more than two decades in operation and its final Boeing 777-200ER.
The airline cut its full-year losses to 10.2 billion shillings ($101 million) in 2017, from a record 26.2 billion shillings the previous year, and may also reinstate in the third quarter, fixed-price fuel contracts which, it dropped in 2016.