Madagascar Airlines appoints new chairperson and temporarily suspends Europe services
Madagascar Airlines announced (07-Nov-2023) the following measures in response to its financial situation:
- Appointed Mamy Rakotondraibe as chairperson;
- Temporarily suspended long haul operations to Europe. The airline stated that maintaining long haul ACMI operations is not economically viable. Madagascar Airlines will maintain connectivity to and from Paris through its codeshare with Corsair. Madagascar Airlines aims to resume long haul operations in "a few months" under dry lease arrangements with its own aircraft;
- Restructure the domestic ATR fleet by returning certain aircraft and refurbishing others. Additional ATR crew training will support increased rotations;
- Resume preventive maintenance, replenish parts stocks and hire and train new mechanics;
- Return to the IATA Billing and Settlement Plan (BSP), Clearing House and Cargo Account Settlement System as quickly as possible. Returning to the BSP is expected to allow Madagascar Airlines to consider partnerships with other airlines to support its return to long haul operations;
- Merge the distribution systems and codes of the airline's predecessors Air Madagascar (MD) and Tsaradia (TZ).
The airline secured support from Madagascar's Ministry of Transport, financial partners and potential investors for its new business plan, which is being validated by public authorities. The plan is designed to return the airline to profitability. The carrier accumulated losses of USD25 million between its launch in Apr-2022 and the end of 2022 and a similar amount in 2023 to date. The airline reported its debt is increasing. Madagascar Airlines attributed the losses to its efforts to maintain a long haul operating model under ACMI agreements and to the high cost of fuel. The airline stated the combined ACMI and fuel costs resulted in losses of USD2.8 million per month. The losses impacted the carrier's cash flow and its ability to pay suppliers, resulting in the grounding of part of its ATR fleet and operational disruptions. [more - original PR - French]