Flag Carrier Enrages Private Carriers

by Zelalem

Owners and managers of local private airlines yesterday voiced their grave concern over Ethiopian Airlines recent initiative to launch a premium charter flight services.

Following a news article run by The Reporter about Ethiopian Airlines plan to commence new premium passenger charter flight services in Ethiopia and abroad with light aircraft, local private airlines wrote a letter to the Ethiopian Civil Aviation Authority (ECAA) requesting the authority to organize an urgent stakeholders meeting. Accepting the request ECAA called representatives of Ethiopian Airlines, Ethiopian Airports Enterprise, private operators and other stakeholders to the urgent consultative meeting held yesterday at the authority’s auditorium. Two members of the Parliament’s Transport Affairs Standing Committee attended the consultative meeting.

Most of the private airlines expressed their discontent over Ethiopian new business plan to provide premium charter flight services. The national flag carrier is contemplating to provide high end comfortable charter and scheduled flight services with light aircraft that each has 10-20 seats. The airline is planning to buy about 50 light aircraft.

Amare Gebrehanna (Capt.), deputy managing director of Abyssinian Flight Services, said that the general aviation sector in Ethiopia is at its infant stage. Amare said the sector gets little support from the government. “It is only recently that the ECAA and the Ethiopian Airports Enterprise (EAE) started supporting the sector. And recently for the first time scheduled flight service license is granted to a private operator,” Amare said.

Amare went on to say that Ethiopian Airlines is an international airline that competes globally. He said that he surprised to read on The Reporter newspaper that the national airline is to provide charter flight service with light aircraft. “What is the purpose of venturing into general aviation business? Is it to eliminate the existing infant general aviation sector? Is it the airline’s business strategy or is it a government strategy?” Amare inquired.

Terefe Haile (Capt.), general manager of Trans Nation Airways (TNA), a subsidiary company of MIDROC Technology Group, said that following the government’s decision to push the seat limits on aircraft that private airlines can operate from 20 to 50 his company launched scheduled domestic flight service. “We are the first company to launch domestic scheduled flight service. We are making history and we labored a lot to achieve this.”

Terefe said that Ethiopian Airlines is growing fast and everybody is proud of the growth. However, he said, it is not only about Ethiopian Airlines that one should think of when speaking about the growth of aviation in Ethiopia. “There are only three or four of us (private airlines) actively engaged in the general aviation sector in Ethiopia. We are very small. While this is the case I am confused to read that Ethiopian Airlines is to deploy 50 light aircraft to provide charter flight service. If this is true we cannot compete with the prominent Ethiopian Airlines. So we will salute them and walk out of the business.”

TNA launched scheduled flight service to Bahir Dar, Gondar and Humera last November. Terefe said that his company undertaken a feasibility study before commencing domestic scheduled service and identified the gaps in the domestic flight market. “So we started operation with the view of closing the gap. But when TNA is about to commence the domestic flight service Ethiopian started to fly to Humera, Bale, and Assosa. They recommenced operation to domestic routes which they ignored for years. Is it business competition or is it a strategy to eliminate us? We are confused,” he lamented.

Terefe went on to say that ECAA which always provides prompt service to TNA granted only a temporary license valid for only three month. “As an airline how can we plan for three months? And if Ethiopian is going to start charter flight service with 50 aircraft how can we plan for the future?”

Owner and managing director of National Airways, Abera Lemi (Capt.), said that Ethiopian Airlines as a business company can engage in any type of business. However, he said, he wants to know if it is the airline’s move or if it was the government’s plan. “We often hear the Prime Minister saying that the government involves in business sectors where the private sector is unable to engage in. Does the government wants us to thrive or not? We want to know this. We do not think that the government wants ET to venture into the general aviation sector.”

Abera said that if Ethiopian is to venture into general aviation then the government should lift the seat limitation that it imposed on private airlines.

Henock Tefera, Ethiopian VP for Corporate Strategy, Communication and Alliances said that what has been reported about Ethiopian move to commence premium charter flight service is accurate. Henock said that Ethiopian Airlines for the first time became the largest carrier in Africa. “Today Ethiopian is the largest cargo operator in Africa. It is building a state-of-the-art cargo terminal at a cost of 110 million euros. Ethiopian serves 84 international destinations across the globe. These achievements are realized by a hard work of a dedicated management team and staff of the airline.”

Henock said that Ethiopian considers aviation as enabler adding that Ethiopian plays its role in expanding tourism and trade. “The government tasked us with availing even air transport service throughout the country. The government wants us to support the export trade business. We positively contribute to the country’s GDP growth.”

Henock told participants that with the view of availing air transport service in all the regions Ethiopian is opening up new domestic routes in different parts of the country. “This is clearly set in our Vision 2025 growth strategy. We now have 20 domestic routes and will increase it to 26 in the coming years. This has to be clear. So it is totally wrong to say that Ethiopian started flights to Humera, Bale and Assosa when TNA is about to commence scheduled operation.”

According to Henock, considering the fast economic growth of the country, Ethiopian has undertaken a study on the domestic charter flight service market. “We have identified a viable market potential. We have been providing charter flight service for the past many years but now we want to strengthen it. The tourism sector is growing and there is also a need for air ambulance service. We want to augment the growth of the tourism sector. We want satisfy the demand.

Henock went on to say that the objective of the airline is to provide air transport service to the public. He said when it comes to domestic service it is not the market that governs the airline fares. “We are not governed by the market. We consider the public’s purchasing power when we set fares. We have a national obligation set by the government to avail affordable air transport service to the public.”

He also said the airline does not consider the local private airlines as competitors adding that the national airline’s competitors are the international ones.

Tekle Geberyohannes, Ethiopian Addis Ababa Hub Director, on his part said that Ethiopian does not consider any one as an enemy. Tekle said when Ethiopian flights to Bahir Dar, Gondar and Humera are full it remands passenger to TNA. “As a business company we should pass our customers to other airline. But since we value our customers we send them to TNA. Why should we offer passengers to TNA if we want to eliminate private operators?” he asked.

Director general of ECAA, Wossenyeleh Hunegnaw (Col.), said that there is no proclamation that prohibits Ethiopian not to provide domestic charter flight service. Wossenyeleh said that Ethiopian has been providing domestic scheduled flight service for the past many years. “There is no one who can stop Ethiopian from providing domestic flight service. The government will not prohibit Ethiopian from providing domestic charter flight service. It is not appropriate to say that I will walk out if Ethiopian is going to do this and that. Private airlines should compete. The question that should be asked is about level playing field. The government supports the national flag carrier. But it is not at the expense of private operators. We have to make sure that there is a fair competition.”

With regards to the seat limit Wossenyeleh said that it was a policy issue. “A national air transport policy is in the pipeline and this is something that will be addressed in the aviation policy.”

The private airlines have complained about airport services which were addressed by representatives of Ethiopian Airports Enterprise and Ethiopian Airlines. Wossenyeleh told the audience that ECAA will forward some of the questions raised by the private operators to government officials in the higher echelon.

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