KENYA: What About Kenya Airways

The news from Kenya Airways is bad. It registered a staggering Ksh26.2 billion ($262 million) loss this past year. M
ore than the staggering loss of the previous year. Despite reports that its passenger numbers were up by 4 million.

That its income from handling was also up. That, relative to the previous year, its revenues were up by Ksh6 billion ($60 million).

It took drastic cost-cutting measures. It sold its parking slot at Heathrow Airport. It sold two of its planes. None of which has made a difference.

The public has a stake in KQ. Partly because we still publicly own about a quarter of it. Partly because individual Kenyans are shareholders in it. Partly because, as its slogan proclaims, it’s meant to be the “Pride of Africa.”

But it isn’t. Anecdotally, that accolade is increasingly given to Ethiopian Airways.

Both airlines, together with South African Airways, have significantly opened Africa up to itself. No more travelling to Europe to come back down in West Africa.

No more matatu-like, nerve-wracking (if entertaining) experiences in cross-continental travel on the infamously named “Air Peut-Etre” – Air Maybe, meaning maybe the plane will arrive, maybe it won’t.

Maybe your suitcase will make it on board, maybe it won’t. Maybe it’ll take off on time, maybe it won’t. Maybe it’ll get you there safely, maybe it won’t.

Travelling west was hair-raising till the mid-1990s, when finally those three airlines made it a predictable process. In KQ’s case, enabled by the KLM partnership.

Initially, at least, that partnership also ended the political annoyances that previously accompanied any KQ travel.

Like heading to the airport for a plane down south, only to be held hostage at the airport, together with a couple hundred other passengers, for almost half a day. Why? A Kenyan minister had commandeered the plane.

So the goings-on of the past year or so are disturbing. Many explanations have been given. That the investments in new planes to service all the new African routes (as well as new routes into Asia) always meant a dip in profitability.

That loans for those investments, being dollar-denominated (at interest rates inexplicably well above European averages) meant huge exchange losses as the shilling steadily depreciated.

That fuel hedging — to protect us from oil price volatility — instead locked us into fuel prices well above the current prices.

It’s hard to make sense of. But what we can make sense of is relative costs and relative comforts. From a consumer perspective, KQ is increasingly not the best bet.

Its tickets are consistently higher than other options; it only retains its customer base because many like flights that are as direct as possible. Its comforts are ever more Spartan, annoyingly so.

KQ’s cost-cutting gurus may think we don’t notice the absence of salads or cheese or the overall shift in airline food suppliers to companies associated with the political who’s who. But we do.

They may also think we don’t notice the headsets that never get fixed. But we do. Or the second-rate entertainment products (despite the admirable push for more Kenyan content). But we do. Or the steady creep back of flight delays. But we do.

Unless delays and pricing go down, while services go up, KQ’s supposedly increased customer base will not be sustained.