South African Airways Targets Ghana as Site of West Africa Hub

South African Airways plans to meet with rival operator Ethiopian Airlines Enterprise as it considers plans for establishing a hub in West Africa.

The continent’s biggest carrier is targeting Ghana as the preferred location for a base and wants to work on the plan with Asky Airlines from neighboring Togo, in which Ethiopian Airlines has a stake, spokesman Tlali Tlali said in an e-mail.

SAA initially considered Senegal as a possible hub as it seeks to compete with Ethiopian and Kenya Airways Ltd. in tapping traffic beyond their home markets. That strategy has now been abandoned as not commercially viable, Tlali said.

“We’re now focusing on Ghana as we operate on the Johannesburg-Accra sector,” Tlali said in response to questions from Bloomberg News.

The Johannesburg-based Business Day newspaper reported earlier that government-owned SAA wants to take a stake in Asky and relocate it to Accra, the Ghanaian capital. Asky won’t sell shares to SAA and wants to set up an Accra hub of its own, spokeswoman Traoré Afsath said by phone today.

Ethiopian Air, the African No. 2, added a hub in Togo in 2008 via an investment in Asky that stands at 40 percent, and opened another in Malawi in the south this year. The Addis Ababa-based company is evaluating a fourth base in Congo.

SAA Chief Executive Officer Monwabisi Kalawe said in December that the unprofitable airline needs billions of rand from the South African government to survive and won’t break even for four to five years. The company wants to replace an aging long-haul fleet with new planes to cut operating costs.

The International Air Transport Association this week confirmed forecasts for Africa’s carriers to earn money this year for the first time since 2010.

To contact the reporters on this story: Christopher Spillane in Johannesburg at cspillane3@bloomberg.net; Amogelang Mbatha in Johannesburg at ambatha@bloomberg.net; Kossi Woussou in Accra at kwoussou@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net; Benedikt Kammel at bkammel@bloomberg.net John Bowker, Christopher Jasper

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