African airlines deserve more than lip service

During a recent panel discussion held in Cape Town attended by some big names in the aviation industry, i.e. Rodger Foster of Airlink, Sameer Adam of ACIA Aero Leasing, Joao Po Jorge of LAM - Linhas Aéreas de Moçambique, Helen Brume of African Export Import Bank - Afreximbank and Federico Curto of Avion Express, some issues were highlighted: • The average African airline loses money on every passenger carried. When you consider history, this is effectively a failed industry and the premiums to access capital reflect that accordingly. • If your jurisdiction has not ratified the Cape Town convention, you WILL pay higher rates for leases and financing. Lessors and financiers have to protect their assets against risk of default, which unfortunately has crystalised into reality in the past. • It's absurd that Africa has 300 airlines to serve the same population as China and India who have no more than 10 major carriers each. African airlines have to look at consolidation and partnership. • African airlines are better served to buy the weather spot on CNN than to fly half empty widebodies to just park at Heathrow airport. It is cheaper, better bang for buck and more people will see it. You cannot have a preconceived mandate to run a prestige route and expect to build a viable business plan around that. • Operators in Africa don't take enough time to actually develop their business plans and strategy before rushing out to raise funds and start their airlines. Successful airlines however will focus on reliability, on-time performance and things the passenger actually wants in order to be competitive. • Some airlines may require financial support from their governments, but there needs to be a clear deliniation between that and interference in the actual management of the airline. That leads to lack of efficiency and uneconomic decision making. • Competition makes airlines need to deliver performance. If state owned enterprises act in an uncompetitive manner, there needs to be an impartial watchdog that is able to ensure fair market access and enforce penalties if necessary to secure a level playing field.