International Passenger Traffic

· By February 2011, air travel volumes were 16% higher compared to the low point reached in early 2009 and some 5% above the pre-recession peak of early 2008.

· Africa saw traffic fall by 1.3% compared to February 2010. Against a capacity expansion of 6.9%, load factors fell to 60.4%. Egypt and Tunisia account for 18% of the African market and 0.6% of worldwide capacity. Libya is a further 3% of the African market and 0.1% of global capacity. The impact of political unrest has been severe with absolute traffic (measured by RPKs) falling by 13.1% compared to January levels.

· Middle East airlines saw demand growth fall from 12.0% in January to 8.4% in February. A capacity increase of 11.0% resulted in a load factor of 72.2%. Political unrest in Bahrain, Yemen and Syria is expected to have an impact on the region’s markets in March. These three countries represent about 6% of Middle Eastern traffic and 0.3% of global capacity.

· Europe’s carriers recorded 7.4% growth compared to February 2010 against a 9.8% increase in capacity. This was slower than the 7.9% demand growth reported for January showing the impact of fall off in trans-Mediterranean traffic to North Africa due to the unrest in the region.

· North American airlines reported 6.7% year-on-year growth for February and a capacity expansion of 11.9%. In recent months, the region’s airlines have seen dampened demand due to several factors starting with disruptive winter conditions in December and January, followed by political unrest last month in the Middle East and North Africa. As a result, there is a widening gap between supply and demand pushing the load factor down to 71.7%, significantly below the 82.2% recorded for the full year in 2010.

· Asia-Pacific airlines reported a major slowdown to 3.0% growth, half of the 6.3% recorded for January. A capacity increase of 6.6% pushed the load factor down to 75.4%. Chinese New Year fell at the beginning of February, pushing some of the holiday traffic into late January.

· Latin American airlines were least exposed to volatility in February. Passenger demand increased by 11.8%. This was virtually matched with a capacity expansion of 12.9% allowing the region’s carriers to maintain the strongest load factor among regions at 76.4%.

Freight Demand

· February air freight volumes stood at the same level as the pre-recession cycle peak in early 2008. But it was down almost 7% on the high reached in May 2010 at the peak of business re-stocking.

· The industry’s fundamentals are strong. Business confidence, as measured by the purchasing managers’ index, reached its second highest level ever in February.

· Air freight carried by Asia-Pacific carriers fell by 4.5% in February. This reflects plant closures associated with Chinese New Year as well as the impact of inflation-fighting measures in the Chinese economy. In terms of volumes, this had the largest impact in slowing global growth to 2.3%--the weakest growth since the beginning of the third quarter in 2009 when annual growth rates turned positive again out of the recession. Compared to January, freight carried by the region’s carriers fell by 6.6%.

· On the back of unrest in Egypt and Tunisia, cargo carried by African carriers fell by 5.7%. In absolute terms, the freight carried by the region’s carriers fell by 8.4% in February compared to January.

· North American carriers saw freight expand by 11.8%, second only to the robust 12.1% expansion by Latin American carriers. European carriers showed weak growth of 6.3%, reflecting the region’s proximity and trade connections with North Africa and the continuing weakness in the European economy.

“The industry situation is volatile and we are watching higher fuel prices carefully. Capacity increases ahead of demand are bringing down load factors for both passenger and cargo operations. Demand is still supported by strong economic fundamentals. But with looser supply and demand conditions, it will be a challenge for airlines to recover the added costs of fuel. Our pathetic 1.4% expected margin for 2011 is under considerable pressure,” said Bisignani.

Based on an average oil price of $96 per barrel, IATA is forecasting fuel to account for 29% of average operating costs with a total fuel bill of $166 billion. For every dollar increase in the price of a barrel of oil, the industry must recover an additional $1.6 billion in added costs.

A key topic of discussion among global leaders at the 24th World Economic Forum on Africa was the need for free movement of talent and goods across Africa, in order to significantly strengthen businesses and boost intra-Africa trade on the continent.

This sentiment is echoed by Charles Brewer, MD of DHL Express Sub-Saharan Africa, who attended the forum which took place in Abuja, Nigeria from 7 – 9 May 2014. “There was a collective consensus among African leaders on the topic of mobility in Africa, as well as the importance of efficient border and visa policies. We have seen good follow-up particularly in East Africa and it is imperative to continue to work on the border and customs environment to grow intra-Africa trade.” says Brewer.

He says that the forum took place against a backdrop of significant economic growth in Nigeria – having recently overtaken South Africa as the largest economy in Africa – and that this has spurred investment interest in the country. “Africa is clearly on the global agenda. Despite security concerns, delegates and heads of state from all parts of the world gathered in Abuja to discuss inclusive growth for Africa.”

A key view expressed by a number of African leaders at the Forum was the need for a proactive approach to border management, which will enable trade between various regions. The creation of an environment that enables business growth on the continent as opposed to obstructing it was also addressed by various parties.

Recognising the importance of travel facilitation and talent mobility as drivers to integrate and develop the region, President Paul Kagame of Rwanda, President Uhuru Kenyatta of Kenya and Prime Minister Moussa Mara of Mali have all signed The Call to Action on Travel Facilitation & Talent Mobility, which urges all African States to work together towards the establishment of joint policies and the removal of barriers to facilitate movement of people.

Brewer adds that it was also positive to witness how small and medium enterprises (SMEs) are increasingly being recognized as the primary driver of economic growth in Africa and how they are being supported across Africa. “A growing SME base will create thousands of new jobs, which is an absolute must for this ever-growing continent, as it is a critical driver of sustainable economic growth.”

Having entered Africa in 1978, DHL Express has witnessed the continent grow its economy to what it is today, as well as the evolving opportunities available to SME owners and entrepreneurs. “Nigeria, as an example, previously generated its wealth from the oil and gas industry, but today is a thriving economic hub of diversified sectors, such as finance, retail, telecommunications, as well as its rapidly growing film industry, Nollywood. The expanding sectors offer multiple opportunities to business owners looking to capitalize on the continent’s expansion and economic growth.”

Brewer adds that it is also difficult to ignore the opportunities stemming from the rising middle class in Africa. “The thoughts and preferences of African consumers are changing in that they are increasingly seeking access to new markets and this is only creating further opportunities for both local and international businesses.”

With that said, Brewer says some of the challenges SMEs face include infrastructure challenges and customs regulations and controls. “The fact that world leaders have recognized these issues and put actions in place towards easing the difficulties experienced can only bode well for future business development and success on the continent.”

He points to the commitment made by the Chinese Government to prioritize infrastructure development in African, which is necessary in order to develop connectivity and promote trade between various regions.

“Infrastructure is vital for connecting regions and by improving this, the number of investments within Africa will grow exponentially, creating further opportunities for its people,” says Brewer.

He says that in order to fuel the continent’s momentum, sustained trade from international markets, as well as intra-Africa trade is needed. “If Africa is to compete with global, advanced countries, investment is needed in facilitating trade and the ease of doing business. We walk away from the meeting feeling positive, having witnessed various influential leaders from business, government, civil society and academia, all having similar views of facilitating trade on the continent,” concludes Brewer.

Etihad Cargo will inaugurate a new weekly freighter flight between Abu Dhabi and the Ugandan city of Entebbe on 26 May 2014.

The direct cargo service will operate every Monday using an Airbus A330-200F freighter, with a capacity of 64 metric tonnes. 

Etihad Cargo expects the service to carry large quantities of electronics and textiles to Entebbe, with primarily perishable goods destined for the Gulf region and Europe loaded for the return flight. 

Kevin Knight, Etihad Airways’ chief strategy and planning officer, said: “Uganda is an important market for Etihad Cargo, and the new Abu Dhabi-Entebbe freighter service will allow us to capitalise on the strong import and export demand to and from East Africa. 

“In addition, whilst we expect to see strong onward trade flows over our Abu Dhabi cargo hub to destinations across the Middle East, subcontinent and Europe, ultimately this service will further strengthen the trade ties between the UAE and Uganda.”

Dubai-based Empire Aviation Group (EAG) has added a Challenger 605 to its African-based fleet which now consists of six business jets.

The Bombardier aircraft will be based in Lagos, Nigeria and will be the first of EAG’s managed aircraft in Africa to be offered to the charter market.
The new Challenger 605 business jet was acquired for a private owner by EAG, which managed the entire acquisition process, including registration and induction of the new aircraft into the fleet. The Challenger 605 is a large jet with 11 seats and with an intercontinental range (4,000 nautical miles) and high speed cruise capabilities (Mach 0.8), offering very high reliability and competitive operating costs.
Executive director Steve Hartley, said: “This is a good time for existing aircraft owners to upgrade and for first time owners to enter the market, with business jet prices starting to edge higher as inventories begin to dry up. Africa is a strong emerging business jet market and we were delighted to work with this new customer to source the Challenger 605 with the help of our new sales office in the US, and to manage the entire sourcing and acquisition process. The new aircraft will help meet the needs of the growing charter market in Africa, and offers a very good balance of capacity, range and overall value.”
EAG’s managed fleet of business jets – now spanning the Middle East, Africa and India – continues to grow, with more than 20 business jets under management at any one time

Embraer Executive Jets has developed an integrated and comprehensive customer support plan for the 2014 FIFA World Cup Brazil, which will occur between June 12 and July 13.

Throughout the games, the Company’s support and services will be expanded to be present in the host cities, which are expected to experience higher business aviation traffic.

“Our goal is to ensure presence and assistance for our Brazilian and international customers to enjoy the World Cup with peace of mind regarding aircraft availability,” said Edson Carlos Mallaco, vice president, customer support and services, Embraer Executive Jets.

The additional support measures comprise a broad logistic support, and special procedures, in order to dispatch parts from our distribution center with an exclusive aircraft to shuttle technicians and material. Embraer will strategically position field service representatives, and count on the support of authorized service centers, backed by a Contact Center, which already operates round the clock at its headquarters in São José dos Campos.

At Bertram Luiz Leupolz Airport (SOD), in Sorocaba, Embraer Executive Jets Service Center, operated by Universal Aviation, will provide aircraft handling, hangar and FBO services for all business aircraft makes and models. In more than 215,000 square feet, Embraer offers maintenance, repair and overhaul of its executive jets.

A fleet of over 160 Embraer executive jets operates in Brazil, backed by a strategically based national support network. In addition to both owned service centers in São José dos Campos and Sorocaba, four authorized service centers in Belo Horizonte, Brasília, Curitiba, and Goiânia offer swift and efficient support for customers across the country.

Astral Aviation has signed a Memorandum of Understanding (MOU) with China's HNA Group in which the Chinese group's Hainan Airlines subsidiary will become a shareholder in the Kenyan cargo specialist, reports ch-aviation.

The agreement will see Nairobi Jomo Kenyatta developed into a regional East African hub employing five ERJ-145s on flights to neighbouring countries. 

Chinese premier, Li Keqiang, last month announced a China-Africa regional aviation plan: "Africa has seen its aviation express demands growing rapidly, but it lacks airport, air routes, especially regional operating capacity. China has huge experience and capacity in the construction and management of airports. We will promote the regional aviation industry in Africa. China will provide financing technical and human resourced support.”

Fly-SAX has announced the appointment of Brown Francis as general manager of SAX-Tanzania, a new airline established in Tanzania.

Subject to receiving regulatory approvals from Tanzania Civil Aviation Authority, the new airline’s maiden flight is expected to occur in the second half of 2014. 

“We are launching a new airline to meet the ever-increasing demand for low-cost, efficient and safe air travel within Tanzania from the country’s own citizens as well as international tourists visiting the country,” said Don Smith, CEO and Founder of Fly-SAX and Fly540 Kenya. “I am delighted to be working again with Brown Francis. Having previously headed up Fly540’s and Fastjet’s operations in Tanzania, he brings a wealth of experience and local knowledge to SAX-Tanzania. I look forward to him making it a great success.” 

Brown Francis, 49 years, is a veteran of the airline industry with over 25 years experience. He joins SAX-Tanzania from Fasjet, where he held the position of Director for Industry Affairs for Tanzania since late 2012. Prior to that, Mr Francis was General Manager of Fly540 Tanzania, where he worked closely with Don Smith from 2009 until 2012. Additionally, Mr Francis worked as operations manager for regional Air Services Arusha for 12 years. 

Brown Francis, general manager of Fly-SAX Tanzania, added: “We are very excited about this new start in Tanzania, which builds on the strength of our previous Fly540 operations in the country. Tanzania is home to three of Africa’s natural wonders and is rapidly becoming the holiday destination of choice for international visitors as well as domestic holidaymakers. We believe that we have the right model in place to grow this airline to best serve our passengers within Tanzania.”