On Monday, budget carrier Jambojet made its maiden trip to Kigali, Rwanda, the latest foray into cross-border flights which it aggressively embarked on two years ago.
The focus now shifts to how the airline will perform on this new venture, with analysts saying the rapid expansion is a two-edged sword. The airline can reap big from the new routes — thanks to increased passenger numbers — and also significantly shore up its revenue. However, past experience has shown that quick expansion by an airline can go wrong if not well managed.
The challenges facing Kenya Airways, Jambojet’s parent company, have been attributed to its rapid expansion, with the purchase of 10 Dreamliners under its Project Mawingu, which were to service new routes.
In its new Rwandan flight, Jambojet has to fight to hold its own as the route is home to Rwandair, which has also been expanding. The airline has daily flights to Nairobi from its base in Kigali.
With such stiff competition, Jambojet has its work out as it seeks to have a bigger share of the region’s aviation market.
Economist Toni Watima says that given jambojet’s budget nature, it is likely to get it right on the advantage of low pricing.
“Jambojet will not be competing with the big airlines such as Rwandair as their mode of pricing is different from these big ones,” said Mr Watima.
“Budget carriers can remain afloat by expanding to many routes and as long as Jambojet keeps their operating costs low, then they can compete well.”
The Kigali flights come just a day after the carrier was to launch Nairobi-Mogadishu route, a decision that was put on hold to pave way for further negotiations with Somalia.
The airline says it seeks to enable more passengers to fly affordably and reliably from its hub in Nairobi to the two destinations.
“Our entry into the two markets is part of our regional expansion programme and brings to three the total number of routes we operate in the continent with the exception of those we fly to on behalf of Kenya Airways,” said Allan Kilavuka, Jambojet’s chief executive officer.
The airline will make a daily flight to the two destinations as it builds its presence in the region with more network.
Jambojet currently flies to five local destinations an as well as Entebbe, Uganda from its hub in Nairobi.
According to the carrier, the Entebbe route has recorded over 17 percent growth since the first flight was launched February 15 last year.
The airline has been charging significantly low fares compared with other carriers in what has been attributed to its growth on the Entebbe route.
In Kigali, the airline is charging promotional rates of Sh11,240 for one way.
The airline bought four Bombardier CRJ 900s for regional flights, two of which arrived in the country on April 24 with remaining two getting to the country in September. KCAA previously granted the low-cost airline a three-year licence to fly to Addis Ababa, Dar-es-Salaam, Zanzibar, Kilimanjaro, Mwanza, Kigali, Juba, Hargeisa, Mogadishu, Goma, Kisangani (DRC), Moroni (Comoros) and Lilongwe.