As economies around the world continue to absorb the shock of the coronavirus pandemic, the global airline industry has been one of the hardest hit. At the beginning of April, virtually all passenger planes in the world ground to a halt as one country after the other banned international travel to contain the spread of the virus.
Airlines have had to furlough staff to reduce operating costs and issue refunds for cancelled flights, with Kenya Airways putting employees on a 75 per cent pay-cut.
Ethiopian Airlines is one of Africa’s leading airlines adjusting to the new normal of uncertain fortunes in a seemingly endless horizon.
The airline’s Area Manager for Kenya Yilma Goshu spoke to Financial Standard on the impact of the pandemic on the industry and how the airline is navigating the turbulence.
How has the global outbreak of Covid-19 affected passenger and cargo operations at Ethiopian Airlines?
Covid-19 has really hit hard, especially on our passenger business. We have had to stop our services to 91 international destinations. This has resulted in a reduced income of $550 million (Sh55 billion) as of April 2020.
The management along the hard-working employees are working aggressively 24/7 to prepare for the worst-case scenario, and the bottom line will definitely be affected, although we cannot say specifically by how much.
Ethiopian Airlines has experienced ups and downs in previous times, although this one is unprecedented. We are, however, putting into action strategies in order to emerge stronger.
How is the airline working to adjust its business operations during this difficult time?
The airline is focusing on non-Covid-related businesses like MRO (maintenance, repair, and operating supply) and even Covid-related relief supply conveyance, hotel business and others.
We are also offering charter flights and repatriating citizens to their homeland. Internally, we are putting in place internal cost-saving measures. We are using all possible means at hand to minimise the economic blow.
How has the cargo business been affected, and how are you working to normalise operations given the rise in demand for cargo planes?
As a proactive airline in the business sector, we have aligned ourselves with the changing environment, and we have started using our passenger aircraft to transport the much-needed medical supplies to African countries and others.
This is in addition to serving farmers and producers to move their produce to the desired market place, which, in turn, earns the country’s economy much-needed hard currency. Ethiopian Airlines has been selected to help in the transportation of Covid-19 preventive medical equipment to countries in Africa and outside the continent.
Thanks to the preference of Jack Ma and Ethiopian Prime Minister Abiy Ahmed, we transported medical supplies to 51 African countries in six days. We were also recently selected by the UN’s WFP as a humanitarian shipment hub for Africa to distribute medical supplies.
What do your projections suggest about the recovery of the industry?
It depends on the global situation of the economic impact of Covid-19. We hope that the crises will not endure beyond August 2020.
In your opinion, how should African governments best structure bailouts for the best support to airlines?
As you know, the airline industry is one of the biggest casualties of Covid-19 outbreak. Several airlines in Africa and across the world have called on their governments to inject funds to help them maintain operations.
Based on the figures and predictions of the International Air Transport Association, and other aviation regulators, governments should come to the rescue of their airlines through implementing stimulus packages and other strategies.
Covid-19, in its global nature, should be tackled together; no single country can avoid the pandemic alone, even the superpowers. Therefore, countries should weigh how severely the airline industry is hurting and should stand together and work globally to save the aviation sector.