Africa’s airspace is seen as the new growth frontier by both governments and private investors. Over the past year, several States have unveiled plans to revive or start up national carriers to have a share of the cross-country traffic. This coming as safety concerns have been raised about the same space. Allan Kilavuka, the CEO of budget airline Jambojet, discussed competition and safety of the African skies, among other issues, in an interview with the Business Daily.
HOW WOULD YOU DESCRIBE THE GROWTH OF THE AVIATION SECTOR IN AFRICA?
It’s increasing at a faster rate than before. Although we have a very small share of the global aviation space, the growth is the highest at about six per cent and that compares well with our population growth rate.
It is seen that in the next 20 years, the number of passengers will triple. Operators are also increasing and, with the open skies, is going to liberalise the African skies more once implemented.
DOESN’T HAVING OPEN SKIES THEN THREATEN LOCAL AVIATION?
It is both a threat and an opportunity. If you are prepared for it, you will take advantage of open skies. If you are not prepared for it, yes it is an existential risk because the bigger players take more advantage of liberalisation so you suffer in the process. But I see it as a good thing because there is enough space for all of us in the aviation space. You just need to be prepared for it, plan for it and take advantage of it.
HOW DO WE MAKE CROSS-COUNTRY TRAVEL WITHIN AFRICA MORE AFFORDABLE?
The regional governments are setting up new airlines and we have new players. With more players, we have more supply. This reduces the price and benefits customers. Our model is a low-cost model and when you apply it across the border it reduces the price of travel.
WHAT OPPORTUNITIES ARE PRESENT WITHIN THE CONTINENT FOR JAMBOJET?
Last year we started with Uganda. This year or next year, depending on the rights we get, we are working on Bujumbura, Blantyre (in Malawi), Juba, Kigali, Zanzibar, Mwanza and Kilimanjaro. There is many opportunities and this all depends on when we get the rights to fly into these countries.
And on top of that, there will be more liberalisation in the years to come so we will continue looking for opportunities to expand. We are also looking at how to diversify our revenue streams and de-risk the business because today we rely heavily on ticketing.
WHAT ARE THE REVENUE AVENUES BEYOND TICKETING?
We have ancillary income — advertising income, for example. We have a big database, so how do we use that for income? We also have a large database and we need to figure out how we can use it as an asset. In future, we’ll see how we can expand into areas such as chartering.
THERE IS STIFF COMPETITION WITH LOW-COST CARRIERS. HOW ARE YOU DEALING WITH THIS?
The thing with competition is that it is always good for the industry, for us and for the customer. For that reason we respect and welcome the competition. For us the most important thing is the customer. We need to understand what the customer wants and provide that.
Competition makes us better as a company because we are able to respond faster and look for opportunities for improving. It also helps the customer, who is able to look at various options — including who is more affordable, who is reliable, and which airline is offering better service and better value.
Thirdly, it also helps the entire industry up its game. We have space for everybody. The concern is that sometimes we flood the market with capacity and it becomes unprofitable to operate certain routes. As a result operators tend to withdraw and then passengers suffer. That is a concern but it self-corrects after a certain period of time. We also look for opportunities to collaborate with competition. The more we collaborate, the more we make it safe.
THERE HAVE BEEN INCREASED SAFETY CONCERNS IN THE WAKE OF THE LION AIR AND ETHIOPIAN AIRLINES CRASHES. TWO SMALL PLANES HAVE CRASHED IN KENYA IN THE PAST YEAR OR SO. THERE WAS THE Jambojet INCIDENT AT KISUMU. WHAT SHOULD BE DONE TO ADDRESS THE SAFETY CONCERNS?
Our thoughts and prayers are with the family and friends of the victims of these tragic accidents. In aviation, when something like that happens we are all affected, whether psychologically, economically and many other ways.
It’s understandable that when these events happen in a short span, it’s a concern for everybody, more particularly the industry. Air transport is still by far the safest mode of transport. I know it is difficult to believe because when an accident occurs, the fatalities are higher than any other mode of transport and that makes it sound like it is not safe.
With time, especially for the frequent fliers, they get to understand that part. We have seen when these accidents happen we have a drop in the travellers but this quickly recovers. The most important thing is for the regulator to continue watching over safety of the entire industry and for us as the operators to be responsible and to adhere to the guidelines. We are as safe as we want to be, it does not matter how much the regulators try to regulate us. It boils down to individual responsibility by the airlines.
Secondly, I would like to clarify regarding the Jambojet turn back in Kisumu. The position is that purely as a safety precaution the captain made the correct decision not to land due to very bad weather conditions. On that day, we had operated six return flights to and from Kisumu."
WHAT STEPS HAVE BEEN TAKEN TO ENSURE SAFETY IN THE AVIATION SECTOR?
First of all, we are regulated. If everybody followed the regulations then we would be safe. We like every other airline have operating manuals we make sure we adhere to and then we have opened up our operations to scrutiny, first by the regulator but also to our partners, including Kenya Airways, KLM and AirFrance. In addition, we are in the process of doing an IATA Operational Safety Audit (IOSA). We have just concluded the audit and are going through some closing safety procedures so we are hoping anytime now we will be awarded the certification.
HOW PREPARED IS JAMBOJET IN TERMS OF SAFETY?
We are very prepared, we have a whole department that handles safety and security. They do training across the board including myself. Apart from training we have a whole process on crisis management which from time to time involves drills on preparedness. We also participate as observers in other people’s preparedness when it comes to any issue regarding safety. We were involved last week in Eldoret. They had a drill and we were observing, making sure they are going through the correct safety procedures.
DO THE AFRICAN AS WELL AS THE KENYAN AVIATION SECTORS HAVE THE CAPACITY TO INVESTIGATE ACCIDENTS?
I am probably not the most qualified person to talk on that. But the statistics from the International Civil Aviation Organisation (ICAO) give us a 48 per cent score when it comes to investigating air traffic accidents. So what that tells you is that there is room for improvement. And as you have seen when it comes to these disasters, it is fairly complex and it involves more than just one organisation, different governments and different players and there is always room to improve, particularly because of its international nature.
WHAT IS THE FUTURE OF AVIATION IN TERMS OF REBUILDING PUBLIC CONFIDENCE AND AIRLINE SAFETY?
The African airspace is growing. Disasters have happened before in Africa. We have improved over the years according to ICAO ratings although it is still fresh over the tragic crash. There is always a learning and then an improvement.
There is growth in the number of passengers travelling but Africa only takes two per cent of the global travellers. Regulators and players are improving in terms of capacity and awareness so I expect that there will be even less of incidences.
THERE HAS BEEN UNREST AMONG AVIATION WORKERS OVER THE PAST FEW YEARS INCLUDING INDUSTRIAL ACTION IN KENYA. WHAT ARE THE SHORT-TERM AND LONG-TERM IMPLICATIONS OF THIS?
Disruptions are never a good thing particularly in airline business. Airlines are very sensitive. The industry is very volatile so any small disruption has a big effect on the airline in more ways than one; reputation wise, profitability and even sustainability of the airline.