KQ to increase its African routes

September 26, 2009

, NAIROBI, Kenya Sept 26 – Kenya Airways (KQ) is looking to increase its African routes owing to decreased demand from western countries due to the ongoing financial crisis.

Speaking during KQ’s Annual General Meeting on Friday, Chief Executive Titus Naikuni said African routes constitute half of the airline’s revenue hence the need to boost it even further.

“The network in Africa is not mature because there are some countries that have no flights hence the need to open up new routes,” he said.

Mr Naikuni however said entry into other countries would be subject to bilateral agreements with the host nations.

“This industry is a very political one, in the sense that you just can’t wake up one day and fly into a country. You have to have that government agreeing with the Kenyan government,” he explained.

KQ has total revenue of Sh71 billion, with Africa contributing close to Sh36billion.

Mr Naikuni was adamant that Kenyan immigration officials needed to change the way they treat visitors from West African countries especially Nigeria.

He said although the Nairobi- Lagos route holds enormous potential, flights on the route were declining as Nigerians reduce their flights to Kenya.

Nigeria holds one of the continents biggest economies, which he said could be tapped even further.
“Let’s face it unless we change our attitude to customers like those for sure we will loose out as a country, they are customers, they are not just Nigerians,” the CEO appealed.

Kenya Airways claims to control 67 percent of the African network but says more needs to be done to grow this market share.

He added that they would also be reducing frequency of flights on some international routes as flyer numbers have also decrease.

Routes such as the Nairobi- Guangzhou have witnesses reduced passengers forcing KQ to consolidate with other routes, Nairobi-Bangkok-Guangzhou.

“These routes require large carriers but we simply can’t fill the plane, making it unattainable,” he said.

KQ is also in the process of modernizing its fleet and has already signed up its intention with Boeing to purchase the Boeing 787 to replace 767.

However, a delay in the testing of the plane has prompted KQ to open up talks with Airbus to buy the A300.

“One does not put all their eggs in one basket, the fact that we are talking to Boeing doesn’t mean we cannot talk to Airbus,” he said.

At the AGM, shareholders approved a dividend payout of Sh1 per share held, which is a reduction from the Sh1.75 per share last year owing to the loss for the year ended March 31st.


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