- It is, however, expected to maintain the number of B737s at 15.
- Yesterday, the airline’s chairperson Michael Joseph said the decision is yet to be made.
Image: Douglas Okiddy
Kenya Airways is planning to cut its aircraft fleet to 30 from the current 36, a cost-cutting measure that is likely to see a number of employees sent parking.
A source privy to recommendations by Steer Group and attended an induction meeting between a new consultant and KQ top management told the Star in confidence that the national carrier is considering cutting Boeing 787s to five, and reducing Embraer 190s from 15 to 10.
According to our source, the consultancy firm, Steer Group concluded its turnaround plan for the airline late last year.
It is, however, expected to maintain the number of B737s at 15.
Yesterday, the airline’s chairperson Michael Joseph said the decision is yet to be made.
“Nothing has been decided,’’ Joseph said in a short message.
Both KQ's CEO and the airline's communications director Dennis Kashero had not responded to our several texts and Whatsapp messages by the time of going to press. None responded to our calls
The carrier has a 36-aircraft fleet, 19 of which it wholly owns while the rest are leased. Embraer makes up the bulk of its fleet with 15 aircraft.
The airline flies to 56 destinations worldwide— 46 of which are in Africa.
Talks of fleet cut perhaps signals reorganization plan at the country’s national carrier, which was presented to the International Monetary Fund (IMF) ahead of the Sh26.6 billion capital injections by the National Treasury in the supplementary budget for the current financial year.
According to IMF, the Kenyan government agreed to assume $827.4 million of KQ's debt and provide financial support in FY2022 and FY2023.
The international lender revealed that the Kenyan government would provide $473 million to handle the airline's payment obligations and restructuring costs as part of the assistance package.
Early this month, KQ’s chief executive Allan Kilavuka welcomed the government’s conditional bailout saying it will help the airline strengthen its cash flow and speed up much-needed reforms including its network, fleet and operations
"The financial support will help the airline strengthen its cash flow and speed up much-needed reforms including its network, fleet and operations. Other areas focus on cost restructuring, productivity and efficiency,'' Kilavuka said in a note seen by the Star.
In an internal notice, Kilavuka said the National Treasury has also helped in procuring Seabury Consulting to guide in network trimming, rationalization of flight frequencies and other cost-cutting measures in yet another government attempt to shore up the national carrier's financial position.
The planned fleet cut is likely to see a number of employees sent home, a move opposed by the workers' unions led by the Kenya Airline Pilots Association (KALPA) and the Kenya Aviation Workers Union (KAWU).
A KAWU official told the Star that the union will oppose any move to send members home, workers at the airline are already overstretched and further downsizing will worsen the situation.
''We will deliberate and share an official statement. KQ must address corruption and system losses if it wants to remain competitive. Downsizing is not a solution to financial issues and growth,'' he said.
The pilots’ body on other hand is advocating for increased activities in profitable routes, staff retention to cut on hiring costs and adoption of high capacity flights.
According to the Kenya Aviation Recovery Road Map prepared by the lobby last year, diversification of KQ’s business model like the establishment of secondary hubs, capitalising on low hanging routes and rapid of existing profitable networks requires a high degree of experts.
The recovery plan which informed most of the measures presented to IMF includes replacing some of the Embraer 190 in the fleet with the larger medium-range aircrafts such as the Boeing B737-800 and the Airbus A320 family to meet the underserved needs of the market.
They are also routing for a multi-purpose passenger aircraft with optimized cargo-carrying capacity, saying consideration should be given to the Boeing 777-300ER which is an aircraft that can uplift up to 40 Tonnes of cargo, with full passengers and their luggage.
“We cannot talk of downsizing when our competitors are on expanding and hiring spree. Qatar Airways, Emirates, Ethiopian Airlines and other emerging regional peers aggressively planning for a post-covid takeoff,’’ Murithi Nyagah said.
According to KQ’s report, the airline ended 2020 with a workforce of 3,652, having lost about 1,123 employees. Half of the airline staff left through resignations or voluntary early retirements.
In an open letter to President Uhuru Kenyatta, the union said that the airline must work on a talent retention programme if it seeks to compete with peers in the market.
It said that at least 120 pilots have in the last four years sought greener pastures in competing airlines such as Ethiopian Airlines, Emirates, RwandAir, Etihad, All Nippon Airways, American Eagle and Oman Air.
"Efforts to replace these pilots has not been sufficient and this is evidenced by the 49,000 leave days currently owed to 430 pilots in employment at Kenya Airways,'' the letter reads in part.