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KQ eyes Sh10 billion revenue from US direct flights

By Macharia Kamau | Published Fri, January 12th 2018 at 00:00, Updated January 11th 2018 at 21:37 GMT +3
Kenya Airways Chief Executive Officer Sebastian Mikosz. [Photo/Standard]

Kenya Airways (KQ) expects direct flights to the US, scheduled to start in October, to play a critical role in enabling its return to profitability.

The national carrier announced yesterday it will operate a daily non-stop flight from Nairobi’s Jomo Kenyatta International Airport (JKIA) to New York’s JFK International Airport, with the inaugural flight scheduled for October 28.

The national carrier said it expects the flights to play a critical role in returning it to profit-making territory, noting that the route had potential to increase revenues by 10 per cent in the course of 2019.

Going by the airline’s last year’s revenue of Sh106 billion, the projection will rake in Sh10 billion. It is counting on the tourism - with the US being a key source market for tourists - as well as opportunities to Kenyan businesses accorded by the African Growth Opportunity Act (Agoa) to sustain the flights.

The rising number of US firms with regional headquarters in Kenya and frequent travel by their executives between the two countries is also seen as a lucrative corporate market for the airline.

KQ yesterday started selling tickets for the inaugural and subsequent flights between Nairobi and New York.

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Kenyans and other travellers will be able to buy early bird tickets for $869 (Sh87, 000).

The seats on sale for this price are, however, limited and the cost increases as bookings go up.

KQ Chairman Michael Joseph said at a briefing in Nairobi the move was an important milestone for the airline that just concluded a complex financial restructuring, adding that the route would enable it swing back to and sustain profits.

“This is a symbol of a comeback by Kenya Airways. It will determine the future of KQ and also shows the determination that KQ has to return to being the pride of Africa,” he said.

He added that the airline had confidence in the route, saying: “We would not embark on this if we were not confident that it will work. It will be profitable for us.”

KQ is counting on tourists from the US, which has grown to be the largest tourist source market for Kenya.

Over 95,700 tourists from the US travelled to Kenya between January and October last year.

It is expected that reducing travel time will have the potential of increasing the number of Americans to Kenya.

Frequent travel

Chief Executive Sebastian Mikosz said the airline would also be keen to tap the many American firms with regional hubs in Kenya that have frequent travel requirements between Kenya and the US.

“There is a strong business case for the route. There are 48 major American companies and the US is the largest tourist source market for Kenya,” he said.

The airline will use its Dreamliner aircraft with a capacity of 234 passengers on the route.

The flight, which Mikosz termed ultra-long haul, will take between 14 and 15 hours one way and require four pilots and 12 flights attendants.

The cabin crew on board will be double what is required on a regular flight. The Dreamliners will also be loaded with 85 tonnes of fuel at departure.