Air Namibia Seeks International Ally as Cuts Spell End to Losses
Air Namibia said it’s seeking an international ally as the state-owned carrier makes progress in ending losses, aided by cost cuts, higher ticket prices and the addition of more efficient planes.
With the African company breaking even on a monthly basis since April and aiming to do so for the full year, the focus is on seeking a strong strategic ally, Chief Executive Officer Rene Gsponer said yesterday in an interview in Johannesburg.
“In the long run we need to have a partnership to avoid shrinking to a regional player,” Gsponer said. “We need a strong international partnership.”
Air Namibia already has a code-share agreement with Kenya Airways Ltd, sub-Saharan Africa’s third-biggest carrier, a special purchase deal with Deutsche Lufthansa AG (LHA), the European No. 2, and an accord with Turkish Airlines. (THYAO) Long-haul flights serve Frankfurt -- Namibia being a former German colony -- with short-haul links to South Africa, the country’s last ruler before independence, as well as Angola, Zambia and Zimbabwe.
The carrier, in the first year of a three-year turnaround strategy also involving the scrapping of unprofitable routes, will seek to address non-flying costs by outsourcing operations such as baggage handling, ramp services and catering, Gsponer said. It has taken a fresh approach to revenue management, aided by International Air Transport Association consultants.
Air Namibia’s fleet of 10 aircraft includes two Airbus Group NV (AIR) A330 wide-bodies and four single-aisle A319s, of which it took delivery in the past two years, helping to cut fuel and maintenance costs by about 30 percent, the CEO said.
The Windhoek-based airline had a loss of 600 Namibian dollars ($56 million) similar to that a year earlier, according to Gsponer. Gross profit has surged 51 percent this fiscal year following a 17 percent gain in passenger numbers, he said.
To contact the reporter on this story: Kamlesh Bhuckory in Johannesburg at email@example.com