KENYA: Loss-Making Kenya Airways Should Get a Capital Injection

A Kenyan parliamentary committee said, loss-making Kenya Airways should get a capital injection from shareholders to aid its recovery but must overhaul its board and management team and meet other conditions first.

Shareholders in the airline, which has been losing money for the past three and a half years and took a bridging to stay in the air, include the government and Air France – KLM.

The recommendation by the Senate committee that was formed in June will go to the upper house of Kenya’s parliament. If approved, the government will be have to act, a parliamentary official said.

Last month, the airline reported a smaller pretax loss of 11.9 billion shillings ($117 million) in the six months to September and promised to cut costs and sell $146 million in assets in its attempt to return to profit.

“Given the importance of Kenya Airways to the Kenyan economy, the committee recommends that the shareholders inject new capital into the airline to facilitate the turnaround of the airline,” the senate committee said in a report seen by Reuters.

An spokeswoman for the airline said the company had just received the report and was studying it.

The senators set conditions for a bailout which include demanding major shareholders to overhaul the board and requiring a restructuring of the management team to ensure it had “sufficient skills and experience” to turn the company around.

It also demanded the hiring of a new marketing director with experience to turn around the ticketing system and “ensure proper accounting of revenue from market sales”.

The committee recommended that the Finance Ministry initiate a process of “providing a favourable tax regime”, including possible tax breaks to help the airline and support Nairobi’s bid to be come an aviation hub.

Kenya’s effort to create make a regional hub faces competition from next door Ethiopia, where state-owned Ethiopia Airlines has expanded to become Africa’s largest carrier.

JAMAICA: Jamaica Secures 60,000 New Airline Seats

Jamaica’s set for a major airlift boost this tourist season.

The island has secured more than 60,000 new airline seats, according to Tourism Director Paul Pennicook.

The director announced the news during the JAPEX conference in Montego Bay.

Of the new seats, about 50,000 are coming out of the United States.

“Some of those (flights) will be new to Jamaica and we are very excited about them,” Pennicook said. “Come Dec. 18, American Airlines introduces a non-stop service from Los Angeles into Montego Bay on weekends. Come November 1, South West Airlines introduces daily service from Houston into Montego Bay and come Dec. 1, Frontier Airlines comes into Montego Bay for days per week from Philadelphia.”

Some of the flights include increased service out of Minneapolis on Delta and flights from Gothenburg, Sweden, Oslo, Norway and potentially one out of Dublin next summer.

“We are very excited about the future, because we are having new rooms built, we are having rooms refurbished, products are being upgraded, there are attractions…and we have the airline seats to go with it, so we are looking forward to a wonderful 2016,” Pennicook said.

UNITED KINGDOM: British Airways Adds Seasonal Glasgow – Salzburg Flights

British Airways (London) will add weekly winter ski seasonal Airbus A319 service from Glasgow to Salzburg starting on December 12 per Airline Route.

BA is also adding Airbus A319 service from London (Gatwick) to Valencia starting on November 6 and to Porto on February 11, 2016.

In other news, British Airways on May 4, 2016 will resume the London (Gatwick) – Lima route with Boeing 777-200 ER aircraft. The restored route will operate three days a week.