The Boeing Dreamliner’s ability to service long-haul routes is expected to enhance trade between Kenya and the Far East as well as North and South America.
“The US remains one of Kenya’s main trade partners. Bilateral relations remain strong considering Kenya’s role as the regional trade and investment hub,” Minister for Trade Chirau Mwakwere said following the arrival of the Dreamliner.
The total value of exports by Kenya to the US in 2010 was estimated at $280 million, while total value of imports was $653.6 million in October this year, according to the US Census Bureau Statistics.
Mwakwere said the possibility of direct KQ flights to the US, which is still under discussion between the two countries, should address the trade imbalance that is heavily skewed in favour of the US.
The Dreamliner will serve as the central part in the air carrier’s ambitious expansion strategy targeting the Afro-Asian trade corridor.
“We’re looking at moving on to six new destinations in India and six new destinations in China. Currently we’re doing one destination in India that is Mumbai. If we have more aircrafts we’ll now manage to do a second frequency,” KQ Chief Executive Officer Titus Naikuni said.
The Dreamliners will replace KQ’s ageing B767 fleet, which have had to remain in service for a longer period of time, and required major retrofitting and upgrades, due to the delivery delay of the Dreamliners by Boeing.
“The delay has impacted us in that we’ve not been able to renew our aircrafts. We would have wanted to have newer aircrafts much earlier. It has slowed down our growth,” Naikuni said.
Boeing Commercial Airplanes Vice President of Sales for Africa, Latin America & Caribbean Van Rex Gallard said Boeing currently has a production of 2.5 airplanes with plans to ramp up 10 airplanes a month.
“We’re back on track. The biggest issue we have right now is bringing all the airplanes that have been produced back to certification level,” he said.
KQ is expected to take delivery of nine of the aircrafts in the fourth quarter of 2013, with a possibility of leasing four others, following the signing of a purchase agreement with Boeing in April this year.
The local carrier is looking to increase its fleet capacity, expand to new destinations and increase frequencies on lucrative routes as part of its ten year growth strategy.
The environmentally-friendly 787-8 Dreamliner will carry 210 to 250 passengers, and is fuel efficient using 20 percent less fuel than similarly sized aircrafts.
“One of our biggest challenges has been fuel and when you get into the Dreamliner the whole issue of fuel efficiency becomes very important, so looking at 17 to 20 percent reduction on fuel costs that will impact our operations positively,” Naikuni noted.
The Dreamliners will provide up to 45 percent more cargo revenue capacity, with a total cargo volume of 125 cubic meters.
To finance the acquisition, KQ is planning a rights issue early next year, which shareholders have already approved. The airline expects to raise Sh22 billion through the issue.