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Emerging Africa-Asia market continues to grow with Korean Air service to Nairobi from Seoul

31-Jan-2012

Connections between Africa and Asia will grow from 21-Jun-2012 with Korean Air's seasonal three-times weekly service between Seoul and Nairobi, Kenya. The hub-to-hub flight will link Korean Air's Asian-focused hub to the extensive and growing African hub of fellow SkyTeam carrier Kenya Airways, which plans to serve every African capital city within five years.

The Africa-Asia market will boom this decade, according to Airbus projections that see Africa having the highest percentage growth of traffic to or from Asia. Korean Air's route follows charter services to Nairobi as well as the signing in Dec-2011 of a trade agreement between South Korea and Kenya.

Korean Air will be the only Asian airline to serve East Africa, which geographically and combined with a partner's hub allows for greater traffic feed across Africa. Asian airlines have predominantly focused on serving South Africa while African carriers serve multiple Asian points.

Kenya Airways' largest competitor to Asia is and will be Ethiopian Airlines, which is also pursuing an extensive Asian strategy that it will grow further with the arrival of 787s. Like with Kenya Airways, Ethiopian's Addis Ababa hub facilitates connections across Africa. East African hubs can offer geographic advantages to Gulf hubs.

See related article: Ethiopian eyes 787 service to Hong Kong and new Asian services as Africa-Asia market booms

Flight facilitates Seoul and Nairobi hub connections

 
The timing of the service, loaded into global distribution systems for service until 27-Oct-2012, facilitates connections at either end of the flight. The outbound flight from Seoul, departing in the evening, allows for connections across Korean Air's network to Nairobi, although given the geography of Korean Air's Seoul hub, connections will be strongest around North Asia as other points will require backtracking through Seoul. Given overall limited flight options between Africa and Asia, Korean Air may see passengers on circuitous itineraries. At 5431nm, Korean Air's route to Nairobi will be one of its longest, and one of the longest for the A330 globally.

Korean Air Seoul-Nairobi flight details: 31-Jan-2012

Flight Routing Timing Equipment Frequency
KE959 Seoul Incheon-Nairobi 22:15-05:30+1 A330-200 Tuesday, Thursday and Saturday
KE960 Nairobi-Seoul Incheon 10:30-04:50+1 A330-200 Wednesday, Friday and Sunday
The early morning arrival time in Nairobi allows for onward connections on Kenya Airways' network. On the return Nairobi-Seoul flight, although Korean's flight leaves mid-morning, Kenya Airways has a number of regional flights arriving into Nairobi around 5:00 and 6:00 that will allow for potential transfers to Seoul. The early morning arrival in Seoul allows for onward connections on Korean Air's network.

Kenya Airways early morning services to Nairobi from selected African destinations as at 30-Jan-2012

Departing Arriving Arrival time Frequency Region
Johannesburg OR Tambo Nairobi 05:45 Daily Southern Africa
Entebbe Nairobi 06:20 Daily Central Africa
Addis Ababa Nairobi 06:00 Twice weekly East Africa
Dar es Salaam Nairobi 06:25 Daily East Africa
Brazzaville Nairobi 05:35 Twice weekly Central Africa
Kigali Nairobi 05:25 Three times weekly Central Africa
Accra Nairobi 05:30 Daily West Africa
Mombasa Nairobi 06:30 Daily East Africa (domestic)
Kenya Airways offers the third largest amount of seats across its African network while Korean Air offers the tenth largest across Asia-Pacific (see Background Information).
 

Korean Air is first Asian carrier to operate to East Africa from Asia

Currently just five carriers operate non-stop between Asia Pacific and East Africa: Ethiopian Airlines, Air Mauritius, Kenya Airways, Air Austral and Air Madagascar. The routes are dominated by links to China for business travel purposes and a few destinations in Southeast Asia that act as either stop-overs for the China services or as sources of tourism.

Carriers operating between East Africa and Asia Pacific: 30-Jan-2012 to 05-Feb-2012

Airline

Origin

Destinations (cities)

Seats per week

Ethiopian Airlines

Addis Ababa

Beijing, Hangzhou, Hong Kong, Guangzhou, Bangkok, Delhi, Mumbai

24,488

Air Mauritius

Port Louis

Hong Kong, Shanghai, Singapore, Kuala Lumpur, Perth, Sydney, Melbourne, Delhi, Mumbai, Bengaluru, Chennai

15,784

Kenya Airways

Nairobi

Guangzhou, Hong Kong, Bangkok, Mumbai

12,096

Air Austral

Saint Dennis

Bangkok

5452

Air Madagascar

Antananarivo

Bangkok, Guangzhou

1848

Of the five carriers, only three presently operate to North Asia: Air Mauritius, Ethiopian and Kenya Airways. Additional Asian and African carriers link Asia to Southern Africa, and South Africa in particular, but onward connections are limited and can require significant backtracking.

Carriers operating between East Africa and North Asia ranked by seats: 30-Jan-2012 to 05-Feb-2012

Korean Air to further strengthen trade between South Korea and Kenya

The service comes after South Korea and Kenya signed an agreement to promote trade, which is heavily weighed toward imports from South Korea into Kenya than exports from Kenya to South Korea. Business leaders entered the agreement on 23-Dec-2011 with the aim of opening up trade markets between the two countries, a culmination of discussions that started in 2010 when South Korea sent a delegation to Kenya to scout for investment opportunities. Kenya’s natural resources include limestone, salt, gemstones, zinc and hydropower, and Kenya Airways’ strategic plan to serve every capital city in Africa within five years appeals to South Korea, which is seeking other African countries to invest in.

Kenya and South Korea’s trade relationship has been sporadically increasing since 1998, when Kenya exported KES179 million (USD2.1 million) worth of goods to South Korea, to 2003 where exports plummeted to KES6.4 million (USD75,000), to 2007 when export levels reached KES318 million (USD3.7 million), then increased again to KES717 million (USD8.4 million) in 2010. In the same years, South Korea’s imports were worth KES2.6 billion (USD30.6 million), KES164 million (USD1.9 million), KES8.6 billion (USD101 million) and KES21 billion (USD258 million). In 2010, South Korea became Kenya’s 12th largest import partner and 17th largest overall trade partner (the fourth largest Asian trade partner, just ahead of Singapore).

Kenya’s trade with main partners: 2010

Nairobi International Airport is also a major business hub with premium seats accounting for approximately 18% of all available seats, well above the worldwide average of 5.2% (in comparison, 21% of London Heathrow's seats are premium). Korean Air’s service will further strengthen Nairobi Airport’s position as a business hub.

Nairobi International Airport schedule by class of seats (one-way weekly departing seats): 30-Jan-2012 to 05-Feb-2012

South Korea identified as potentially strong source of tourism, with opportunity for services to grow

Korean Air operated the first ad hoc charter service between Seoul and Nairobi on 15-Jan-2012. South Korea has been identified as a potentially strong tourism market but due to the previous lack of non-stop services, the Kenya Tourism Board (KTA) has been unable to tap this possibly lucrative source. Kenya and South Korea are now engaged in talks over a potential open skies agreement.

Tourism is emerging as a strong industry in Kenya with the KTA reporting over 1 million international visitor arrivals for the year to Oct-2011. Of this, 90% of tourist traffic arrives via air. Visitor arrivals have been increasing steadily over the past number of years, increasing from 1 million in 2000 to 1.4 million in 2009. Of the total number of visitors, 778,000 in 2000 and 1 million in 2009 were for leisure purposes. The UK, US, Italy, Germany, France, Uganda and the Netherlands are Kenya’s largest sources of visitor arrivals, largely reflecting available routes into Kenya. Of Asian countries, China and Japan are the largest sources but only account for between 1% and 2% of the market. Korean Air’s service should change the tourism market while providing links for business travellers to further investment and open the number of destinations available to Kenya.

The next steps in this service will be to bring the route to a year-round operation and increase frequency. As Korean Air is largely limited in serving Kenya from South Korea, further SkyTeam growth into Kenya Airways' very promising Nairobi hub can come in due course from other members.

Background information

Five largest carriers within Africa (seats per week): 30-Jan-2012 to 05-Feb-2012

Rank Airline Total Seats
1 SA South African Airways 444,664
2 MS EgyptAir 213,889
3 KQ Kenya Airways 171,292
4 ET Ethiopian Airlines 170,144
5 W3 Arik Air 136,022

Ten largest carriers within Asia Pacific (seats per week): 30-Jan-2012 to 05-Feb-2012

Rank Airline Total Seats
1 CZ China Southern Airlines 3,269,963
2 MU China Eastern Airlines 3,097,793
3 NH All Nippon Airways 2,521,108
4 CA Air China 2,377,467
5 JL Japan Airlines 1,566,302
6 QF Qantas Airways 1,380,224
7 MF Xiamen Airlines 1,270,667
8 JT Lion Air 1,258,652
9 HU Hainan Airlines 1,166,524
10 KE Korean Air 1,089,564

Kenya Airways Africa route map: Jan-2012

Korean Air Asia route map: Jan-2012


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