Loading

Ex-Im Bank: its withdrawal can undermine 2nd and 3rd tier airlines. TAAG Angola Airlines case study

Premium Analysis

TAAG Angola Airlines is discussing with Boeing a potential acquisition of additional 737 aircraft which would be used to rightsize and grow its fleet. TAAG operates an all Boeing fleet and has traditionally relied on guarantees from the US Ex-Im Bank, which has an uncertain future under the administration of the new US President Donald Trump.

TAAG prefers to stick with the 737 to support regional growth and potentially replace some of its older model 777s. It is not yet considering other aircraft options - such as the Airbus A320, Embraer E190 or Bombardier CSeries families. However, TAAG and its government shareholder will have to consider other manufacturers - and other loan guarantees schemes - if Boeing does not come up with a viable financing alternative.

TAAG has completed an initial phase of a turnaround, posting a near break even result in 2016, but needs to change its fleet composition to position the airline for long term profitability. The government owned airline has too many 777s, given the limited size of its long haul network, and also needs to retrofit at least some of these aircraft as they are in an unideal three class configuration.

Become a CAPA Member to access Analysis Reports

This CAPA Premium Analysis Report is 2,940 words.
Become a CAPA Member

Our Analysis Reports are only available to CAPA Members. CAPA Membership provides exclusive access to in-depth insights on the latest developments in the aviation and travel industry, developed by our team of dedicated analysts located in Europe, North America, Asia and Australia.

Each report offers a fresh perspective on the latest industry trends and is available online or via the CAPA mobile app, with customisable alerts to help you stay informed and identify new business opportunities.

CAPA Membership also provides access to our full suite of tools, including a tailored selection of more than 1,000 News Briefs every week and comprehensive data and analysis on thousands of companies around the world.