ATW– The Ethiopian government will establish an Aviation Holding Group to oversee the country’s aviation-related interests.
According to a government statement, the holding firm would manage Ethiopian Airlines, its cargo and MRO services, Ethiopian Aviation Academy, Ethiopian Airports Enterprises (EAE), Ethiopian Inflight Catering Services, and Ethiopian Hotel and Tourism Services.
Ethiopian Airlines Group CEO Tewolde Gebremariam said, “The Ethiopian government took an important decision in paving the way for the formation of the Ethiopian Aviation Group as a holding company in line with international best practices, which will enable the transformation of all airports in Ethiopia to upgrade their services to global standards by leveraging the synergy with the successful business model and strategy of Ethiopian Airlines.”
The carrier’s home base, Addis Ababa Bole International Airport, is expected to become the best connecting hub in Africa.
The Ethiopian carrier reported average growth of 25% in the past seven years.
“Availability of a seamless customer-focused service defines the rule of the game in today’s hyper-competitive airline industry. The new formation will create common direction and strong synergy to improve services by eliminating waste and redundant activities,” Gebremariam said.
EAE will maintain its internal autonomy, its own brand and functions that play an important role in integrating the services of all stakeholders including airlines, immigration services, customs, security services and ground handlers, to ensure that all provide global standard airport services.
EAE CEO Tewodros Dawit called the new group “a step forward to improve the competitiveness of the Ethiopian Airlines’ hub by taking advantage of the proven record of fast and sustainable growth strategy.” EAE operates 23 airports.
The new structure is expected to allow Ethiopia to continue its aviation leadership in Africa.
Ethiopian Airlines, which has implemented a 15-year Vision 2025 strategic plan, is set to become the leading aviation group in Africa with seven business centers: Ethiopian Express & Ancillary Services; Ethiopian International Services; Ethiopian Cargo Services; Ethiopian MRO Services; Ethiopian Aviation Academy; Ethiopian Inflight Catering; and Ethiopian Ground Services.
In May, ATW reported Ethiopian Airlines plans to implement a “very heavy cost-cutting program,” targeting an annual cost savings of 10%-20% the airline aims to reach as soon as possible without having to reduce jobs.