More turbulence in Kenya Airways' bid to run major airport

The plan for KQ to run JKIA has already received Cabinet backing and now awaits regulatory approvals. [File, Standard]
The volatile events at the Jomo Kenyatta International Airport (JKIA) over the last few weeks, including threats of industrial action, show it won’t be an easy job for Kenya Airways (KQ) to take over the management of the country’s main airport

The events come just after the airline handed in a proposal on how it planned to go about managing JKIA.

It then received a hostile reception, with Kenya Airports Authority’s (KAA) staff threatening a mass strike in a bid to protect their jobs.

While threats of the strike could be unrelated, KAA postponed a series of public participation forums planned across the country to get stakeholder feedback on the proposal by KQ to manage JKIA.

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The airline attributed the delays to logistical challenges. The Privately Initiated Investment Proposal (PIIP) document makes a number of proposals on how KQ will manage the airport.

One that touched a raw nerve among trade unionists is the possibility that KAA’s over 700 employees working at JKIA would lose their jobs with the airports’ company.  They would, however, be re-engaged by a newly formed entity through which KQ will manage the airport.

KAA staff recently called off the strike and instead said they are willing to hold discussions the authority following a meeting with senior Ministry of Transport officials including Cabinet Secretary James Macharia.

 One could, however, tell there are many unresolved issues, with the trade union noting that it had just suspended the strike and also pointing to other outstanding issues with KAA, themselves a possible trigger for other industrial actions.

“We agreed to suspend the strike notice, not call off but suspend in good faith so that we can give KAA an opportunity to engage. There are still issues that we need to talk about and seek clarity,” said the Secretary General of the Kenya Aviation Workers Union Moss Ndiema.

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“Within the industry, a lot of employers do not encourage engagement, and KAA is one of them. There was a build-up of problems up to the point when the issue of the PIIP proposal came up, it was not the only thing.”

Global practice

CS Macharia defended the plans by KQ to run JKIA noting that it is a global practice, where carriers run their home airports.

“The objective of the concession is to create operational synergies between Kenya’s main hub and national carrier thereby facilitating the airport and airline to be economic drivers. This model is similar to what is being utilised by our competitors in the aviation industry,” he said.

Reference is usually made to Ethiopian Airlines and the Arab carriers when justifying the need to put in place protectionist measures for KQ, including the operation of JKIA.

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And while the competitors cited might enjoy preferential treatment at their home hubs, the airports at their home countries are run by separate companies.

While the Ethiopian Airlines and the Ethiopian Airports Enterprise are sister firms under the Aviation Holding Group, the airline does not have say in the airports in Ethiopia including the Bole International Airport in Addis Ababa.

The airports’ company runs aviation hubs in the country.

Other companies forming the Aviation Holding Group include Cargo Airline & Logistics Company, Ethiopian Aviation Academy, Ethiopian Inflight Catering Services, Ethiopian MRO Services and Ethiopian Hotel & Tourism Services.

Such is also the case for Emirates Airline, where the Dubai Airports Company – distinct from the airline – manages the Dubai International Airport, the airline hub.

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Despite the objections that the plan to manage JKIA by KQ, thee plan has already received cabinet backing and now awaits regulatory approvals.

Other than being the airline’s plan, it is also as much a State’s plan to restructure the airline industry that entails propping JKIA into an African hub and KQ into a ‘world class’ airline.

The airline has in the past said it is not looking at an absolute control of the airport or edging out other carriers but instead get fast solutions to challenges that the airport faces on daily basis.

The airline said once the partnership is in place, it would result in speedier solutions to certain challenges at the airport that take longer to resolve due to the bureaucracy that ties down KAA.

“We will be doing a public-private partnership to run and operate JKIA. The airport is profitable and when you combine the two (JKIA and KQ), you create efficiencies in terms of ground handling, catering and maintenance; we can create a much stronger and financially sound unit without State aid. It’s a PPP for 30 years… we will pay them a concession fee KAA,” said KQ Chairman Michael Joseph in a media interview last year.

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Kenya Airports AuthorityJKIAKenya Airways