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KQ must change its business model, analyst tells Senate

Further questions were also raised on which company was contracted to supply the airline with fuel in a deal the airline says cost it a lot of money.

Senators heard that using ‘hedging’ a common practice in the airline industry where a company enters into a deal with an oil company to supply them with fuel at a subsidized price for a certain period.

This is meant to shield the company from the fluctuating oil prices, however even if the prices come down, the supplier continues to receive what was agreed and this affects the airline financially.

Senators also wanted to find out whether the company was paid in advance or after the expiry of the period of contract.

“The managers are better placed to explain whether they were paid in advance or later,” said Odipo.

He also insinuated that there was a plot by Afrexim bank to buy Kenya Airways at a cheaper price following a Sh20 billion loan facility it gave to KQ.

He explained that the suggestion to give the airline a loan was plot to disable it financially and leave it with no option but to sell its aircrafts at a throwaway price.

Odipo was once hired by a Lawyer representing workers to probe the on goings in the company after it laid off workers.

He says the proposals he gave in his report were ignored by the airline.

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Kenya Airways is however confident that it will rise from ashes amid the turbulence it is facing.

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