FastJet shifts focus to East Africa market with Nairobi hub

Budget carrier FastJet will establish its hub in Nairobi next year to allow it operate regional flights from the Kenyan base in what will put the carrier in a head to head battle with Kenya Airways.

Mr Ed Winter, the FastJet CEO, told the Business Daily Wednesday that it was awaiting regulatory approval from Kenyan authorities to allow it start regional flights.

The low-cost carrier will start operations Thursday in Tanzania and continue running in Kenya as Fly540, which is being remodelled into a budget African airline akin to EasyJet, the largest low cost carrier in Europe after RyanAir.

Its quest to have seamless regional operation will see the carrier battle with Kenya Airways, which also received regulatory approval to launch a budget arm dubbed JamboJet.

“We have applied for licenses that will allow us operate Zanzibar-Nairobi and Nairobi-Dar es Salam,” said Mr Winter in Nairobi yesterday ahead of the Tanzanian launch, adding that they were also in talks with Rwanda, South Sudan, and Burundi governments for approvals to open shops in the countries.

“Once we get the approvals to operate in Kenya, we intend to move our operation office from Tanzania to Kenya.” This signals that the carrier, which earlier said it was planning a Pan-African operation, is focusing attention on East Africa while eyeing the rest of the continent in the mid-term.

Mr Winter said that FastJet was eyeing buyout deals in markets that where Fly540 does not have operations to grow its market share faster.

On June 13, Lonrho announced it would transfer its 49 per cent stake in Fly540 to Rubicon in a deal worth Sh7.2 billion and revamp it to FastJet.

It expects to keep fares across the East African routes at between Sh6,000 and Sh6,700, with passengers paying for extras like food and baggage.

Mr Winter said that the carrier will deploy 15 bigger Airbus A319 in East Africa in the next 12 months.

Africa’s aviation market is set to soar, powered by the resource-rich continent’s robust economic growth and burgeoning consumer market, which are driving business and leisure travel.

This has sparked increased investor interest in the continent with a focus on budget airlines, with the market shift pointing to a vicious battle for control of the continent’s aviation industry.

Kenya Airways has received approval to launch its budget arm, JamboJet, which will also ride on low fares due to its leaner cost structure compared to those of international airlines.

Emirates Airline also plans partnerships with Africa focused on low-cost carriers to connect the bulk of the continent’s travellers to the rest of the globe through its Dubai hub.

KQ’s bid for a budget airline is part of a global trend where international carriers are forming subsidiaries to handle local routes and free executives to handle the more complicated international travel business, besides enjoying cost savings from leaner operations.