Someone told us at an event last week: the secret of business success is “collaborate or collapse”. As he was speaking, my social media newsfeed flashed two headlines on my phone. Curiosity got the better of me, leaving the engrossing speaker temporarily without my audience.
One was about SAA and its never-ending turbulence. The great state-owned carrier has just lost about R400 million in revenue due to an eight-day strike to compound its financial distress. The other was also about aviation, but from out in the East African Community (EAC).
It turns out Air Tanzania and Uganda Airlines are about to do what SAA should have done long ago – collaborate with other African airlines. There are more successful carriers on the continent, especially Ethiopian Airlines – Africa’s most prosperous government-owned airline. It has outperformed its bigger rival, SAA, on growth and profitability in the past 10 years.
Air Tanzania and Air Uganda are smaller than Ethiopian Airlines. Between them, they have less than 20 planes. Ethiopian Airlines’ fleet size has more than 120 aircraft.
Uganda and Tanzania understand that unless they work together, sharing routes and complementing each other, it is a matter of time before they tank. Their neighbour Kenya Airways is no longer the “pride of the African skies” and is considering renationalising.
The history of aviation in the founding members of the EAC takes us to the UK. In 1945, when the Brits wore their colonist’s mantle with pride, they orchestrated the founding of an airline to connect London and its African colonies.
The result was East African Airways, owned jointly by the Kenya Colony (67.7%), Uganda (22.6%), the Tanganyika Territory (9%) and Zanzibar (0.7%). Technical and management expertise was the preserve of the British Overseas Airways Corporation (BOAC).
Fast-forward to the mid-1970s when the UK was no longer interested in playing a hands-on colonial role and all three EAC members were independent. BOAC morphed into British Airways.
East African Airways folded in 1975 and Kenya, Tanzania and Uganda each formed their respective airlines. Kenya Airways grew with greater speed and gusto than the other two; forging an alliance with KLM/Air France. When 2010 rolled around, it was in overdrive, vowing to fly to every African capital city by 2013. The exuberance was clipped by spiralling costs and industrial action.
Today, Kenya Airways is recalibrating its trajectory. Its two neighbours, trailing the young upstart RwandAir, are wiser to aviation reality – hence their imminent collaboration. They should do it; quickly.
Sadab Kitatta Kaaya, in a piece for The Observer, quotes Tanzania’s deputy minister of works, transport and communications: “We can complement each other by Uganda Airlines flying passengers from its various destinations to Air Tanzania’s hub at Julius Nyerere International Airport for Air Tanzania to take them to its long-haul destinations.”
The other planned area of co-operation is the restoration of the East African Civil Aviation Academy.
Most state-owned airlines of Africa must consolidate their businesses or quit. SAA is talking something similar. It better hurry up before running out of runway.
- Victor Kgomoeswana is author of Africa is Open for Business, media commentator and public speaker on African business affairs.
OPINION: Victor Kgomoeswana