Africa ripe for low cost carriers

Neelam Mathews

Sept 5, 2011

For contenders looking at short and long-haul low cost business model in Africa, the sky is the limit, said  Suresh Nair Regional Manager, India, Sri Lanka & Bangladesh, AirAsia Group at the Africa Summit held recently.

Talking about "How LCCS can open the African Aviation Market-An AirAsia perspective", Nair gave the example of the success story of AirAsia that opened up the Asia Pacific market growing from a 2 aircraft fleet in 2001 to 105 aircraft today, living up to its tagline "Now everyone Can Fly".

Today in 9 years AirAsia with 105 aircraft operates more than 140 routes to 78 destinations in 27 countries.

Africa is ready for more budget airlines even as the fastest growing airlines in Africa are all LCCs - Air Arabia Egypt, Air Arabia Morocco and 1Time. It has 56 countries, over one billion people, more than half under the age of 25, 2,436 airports, approx. 600+ aircraft and an average economic growth of 5.5%. Boeing and Airbus predict between 700 – 1270 aircraft requirement till 2028 for Africa.

“Exports and related business travel, tourism will be the key drivers for Africa in the next decade,” says Nair. Possible hubs in Africa for LCCs could be Johannesburg, Casablanca, Cairo, Nairobi, Addis Ababa and  Lagos.

Short haul/regional budget carriers could connect intra-African points, promote regional tourism, trade and stimulate demand by ensuring high frequencies between national capitals and key cities. While a long haul LCC could replicate the AirAsiaX model that connects key gateways and cities with Europe, Far East, Gulf & Middle East and the Americas.

This would require simplified processes and greater distribution reach through greater use of web technology, open skies and liberal bi-lateral agreements between countries in Africa,  Low-Cost Airports, Trained personnel specially Pilots/Engineers and  marketing of Africa as one BIG tourist destination, said Nair.