Kenya Airways Chairman Michael Joseph addresses an investor briefing during the company’s release of its 2019 half year earning on August 27,2019 PHOTO | CITIZEN DIGITAL KQ’s operational costs proved definitive in dragging the carrier to its biggest ever full year Ksh.36.2 billion loss earlier this week as revenues tumbled in the wake of disruptions in the aviation sector and subsequent low passenger demand.
The airline predicts a gradual and painful recovery from the pandemic with pre-pandemic demand levels expected to resume in 2024 at the earliest.
Around the world, different airlines have taken different directions in staying in business as they also suffer from the pandemic’s strife.
Kenya Airways (KQ) Board Chairman Michael Joseph says the proposed nationalization of the carrier is not the only way out for the struggling airline which is presently flying through turbulence.
In spite of its heavy reliance on exchequer support in the last three years, Joseph says returning the carrier under the wings of government is not the only cure on the table even as government support remains integral.
“Things have dramatically changed since then even from a nationalization point of view. It’s not the answer anymore we need to do something different. We have a proposition but it needs support from the government which may not necessarily be financial,” he said during an interview with Citizen TV’s JKL Live on Wednesday night.
“We need to look at partnerships that will help us grow and become a much bigger competitor against leading nationalized carriers such as Middle Eastern operators.”
While Joseph did not divulge further on the details of the new direction, he said the plan is centered on significantly trimming operational costs to compete at par with peers such as Ethiopian Airlines.
KQ’s operational costs proved definitive in dragging the carrier to its biggest ever full-year Ksh.36.2 billion loss earlier this week as revenues tumbled in the wake of disruptions in the aviation sector and subsequent low passenger demand.
Revenues in the period for instance fell by 58.8 per cent to Ksh52.8 billion. This is as operating costs which largely comprise of fixed costs only eased by 38.5 per cent to still stand above earnings in the year.
According to the KQ Board Chairman, the carrier is already at an advanced staged to clear up its legacy costs issues to include a review of its leasing contracts.“Allan (Kilavuka- KQ CEO) and his team have negotiated about 70 per […]