United Republic of Tanzania
The United Republic of Tanzania is located in East Africa. The country’s major international airports are Julius Nyerere International Airport, followed by Kilimanjaro International Airport and Zanzibar International Airport. Air Tanzania is the country’s national airline. Other international airlines serving the country include Kenya Airways, British Airways, Emirates Airlines and KLM. Tanzania Civil Aviation Authority is the regulatory body responsible for aviation in the country.
Airports in United Republic of Tanzania
472 total articles
15 total articles
Low-cost carriers are starting to slowly – very slowly – penetrate Africa’s regional international market. LCCs currently only account for about 0.2% of international capacity within Africa, making it one of the last frontiers for the global LCC sector.
Tanzania-based LCC start-up fastjet finally launched services from Dar es Salaam to Johannesburg on 18-Oct-2013, completing a tedious delay-ridden process. It is the first of several planned international routes for fastjet from Tanzania and other potential new bases throughout Africa.
Incredibly there are currently only five international routes within Africa operated by LCCs. The opportunities for LCCs to penetrate the intra-Africa market are huge but so are the challenges.
fastjet has reported a USD42 million net loss for the six months to 30-Jun-2013, but its directors remain upbeat about the fledgling African LCC’s prospects, with its Tanzanian domestic operations exceeding expectations and making a profit on an underlying route basis. But the directors acknowledge in the unaudited accounts that the carrier will need to raise further funds in the future “which represents a material uncertainty over going concern”.
fastjet’s ambition to establish Africa's first pan-African low-cost carrier is continuing to encounter strong headwinds. On its own admission, the Tanzanian market is too small to sustain the company and international expansion is critical to its longer term survival.
But the first international route from Dar es Salaam to Johannesburg has, perhaps predictably, run foul of South Africa’s bureaucrats forcing the eleventh hour postponement of the route launch by about two weeks to the middle of Oct-2013. fastjet will compete against South African Airways (SAA) as the only other operator on the route and has promised to reduce fares by 60%. fastjet is taking online bookings for flights departing from 18-Oct-2013.
South Africa’s SA Express has reported a net profit of ZAR650,000 (USD65,000) for the 2013 financial year, turning around a restated loss of ZAR365.9 million (USD36.7 million) in FY2012 driven by increased revenue and stable operating costs.
The result marks a return to profitability as the state-owned carrier and member of the South African Airways Group looks to expand its regional network over the next six months and strengthen its feeder support role for South African Airways as well as implement a fleet replacement programme to further reduce costs.
SA Express also reported a 91% reduction in its operating loss to ZAR25.1 million (USD2.5 million) in FY2013. SA Express CEO Inati Ntshanga said: "Though the business is making the right decisions and heading in the right direction, we cannot afford to be complacent as a lot still needs to be done to ensure that we champion a sustainable operational and financial performance."
While selected details of the financial results were presented at the airline’s AGM on 25-Sep-2013, neither the full audited accounts nor the annual report have been made public.
Tanzania’s largest carrier, Precision Air has belatedly reported a TZS30.5 billion (USD18.9 million) loss for the financial year to 31-Mar-2013, compared to a TZS633.8 million (USD392,814) profit in the year prior. The poor result is largely due to Precision’s over-ambitious expansion during FY2012 which saw the carrier lease three Boeing 737-300s to operate regional routes, including Dar es Salaam to Johannesburg.
The situation has been compounded by a disappointing initial public offering in Nov-2011 which raised less than half the TZS28 billion (USD17.3 million) sought to pay for Precision’s fleet and route expansion plans. The carrier listed on the Dar es Salaam Stock Exchange (DSE) in Dec-2011. The arrival of LCC fastjet on two key domestic routes, forcing down fares, has also had an impact.
Precision is now urgently seeking a USD32 million bailout from the Tanzanian Government and other investors to meet bank and aircraft loan payments. A request to the government for a USD4 million capital injection was reportedly rejected earlier this year. But the government could be persuaded to take an equity stake in Precision to ensure air access to outlying regions is maintained.
This is the second instalment in a two-part series of reports on South African Airways' (SAA) low-cost subsidiary Mango. The first report looked at Mango’s slow pace of expansion in the five years after its Nov-2006 launch and its improved outlook in the domestic market, where the carrier over the last year has begun pursuing faster growth. This report looks at the potential for Mango to operate international services from its South African base and launch new affiliates in other African countries, which would put Mango in competition with new pan-Africa LCC group fastjet.
Potential joint ventures or affiliates have always been part of Mango’s long-term plan. But just as it has been relatively conservative in the domestic market, Mango has been slow to expand in the international market – both organically and in establishing joint ventures.
fastjet has suffered a baptism of fire since entering the African market through the acquisition of the Fly540-branded aviation business of British conglomerate Lonrho and a 49% stake in Kenya’s Five Forty Aviation in Jul-2012.
The carrier holds ambitions to establish the first pan-African LCC airline by creating a series of fastjet branded airlines throughout the continent under a common sales and service platform. But a series of setbacks including a bitter legal dispute over the ownership of the Fly540 Kenya interest, unexpected delays in gaining rights to operated international services from its Tanzania home base, attempts to enter the South African market and underperforming Fly540 subsidiaries in Ghana and Angola have all conspired in fastjet posting a USD56 million loss for the 18 months to 31-Dec-2012.
Nevertheless, the company remains confident it will succeed. fastjet executive chairman David Lenigas stated: “The next few months will represent a greater transformation for the Company as we endeavour to further implement and grow the fastjet business model. The board is confident it has the right strategy and team in place to build a successful and profitable future for our shareholders”.