Where Ethiopian Airline is the king

An African airline as good as Ethiopian Airline would be hard to find. The way I see it, I will  fly on Ethiopian Airline again. In Africa, airline companies have bad reputation. So, it is a good thing that Ethiopian Airline is a visible success in a sector more notable for its failures in the continent. 

I usually avoid African airlines each time I want  to travel by air. My recent trip to Nigeria last Christmas, however, changed my mind. Before my trip, I promised myself that I must avoid going through Lagos, Nigeria’s largest city. Anybody who have travelled through Lagos knows what a bitter experience it could be. I still haven’t forgotten the  day a cab drove me through Apapa-Oshodi Expressway,¹ one of the highways in Lagos. What I saw that day was indeed an apocalyptic scene. I saw six lanes of buses, sedans, fuel tankers, and motorized  tri-cycles popularly known as “keke”² in Nigeria, wedged bumper-to-bumper in both directions. While my can got stuck in the traffic, curses and horn blasts pierced the diesel and petrol exhaust-choked air. I constantly heard screeching brakes as vehicles inched forward. In the backseat where I was, I was so uncomfortable that I found it hard to relax. It wasn’t an experience I would like to repeat.

It was because of these issues that I decided to avoid going through Lagos at all cost. The best option for me, I thought, was to fly directly to Enugu,³ a ‘sleepy’  city located in Southeastern Nigeria. My plan was to stay briefly at Enugu before driving down to my village to celebrate the Christmas. But the problem became finding an airline that has a direct flight to Enugu International Airport. One of my students told me about Ethiopian Airline. She said she used it recently and that it was a good airline. For someone who likes sure things, I decided that a little research is worth it. What I found out, and my experience after using the airline, was very interesting.

Add and subtract

An African airline as good as Ethiopian Airline would be hard to find. As Africa’s most profitable and largest airline, Ethiopian Airline enjoys earnings that is more than its rivals combined. Its expansion was also rapid. It served 82 international destinations by 2015, with 13 more added in 2016. It nearly doubled its profits in the last financial year, and was able to do this despite the country’s national turmoil(see figure 1). Generally speaking, the airline enjoys one unique advantage: its regional rivals are competing only feebly on routes in Africa. According to the available published evidence, African airlines collectively  recorded a net loss of about $500 million in 2016.⁴  

Figure 1: Ethiopian Airline – Profit and Passenger Data

Year	Passenger (Millions)	Net Profit ($ Million)
2010	3	110
2011	3.5	77
2012	4.5	56
2013	5.1	145
2014	6.0	161
2015	6.3	208

Source: The Economist, 2016

One good example is Kenyan Airways. This airline had been in red for four years in a row. It is flogging some of its aircrafts and it announced last September that it was talking to foreign  institutional investors about raising more equity. South Africa’s national carrier has been unprofitable since 2011. This airline, which was overtaken by Ethiopian Airlines in terms of size, could obviously be insolvent without government guarantees.⁵ Arik Airline, Nigeria’s largest airline, almost collapsed last year due to heavy financial debt burden, inability to pay staff regularly, weak corporate governance, operational difficulties and overall poor management.⁶

It is worth bearing in mind that the airline’s success did not happen by chance. It resulted from good management: the airline took advantage of its strategic location in the Horn of Africa. While its rivals were fixated on the former colonial routes to and from Europe, the airline took a more giant stride. It captured Asian traffic and, in addition to European and US market, its routes also connects China with Brazil via India and the Gulf. Its management were smart enough to take an early punt on Chinese demand. It was the first African airline to fly to China by 1973. The Chinese market is a good source of revenue for the airline, as could be seen from its bustling Chinese counter at Addis Ababa’s Bole airport. The airline also manages its African routes well: it schedules more flights to places like the country’s booming oil port of Point Noire and less flights to small African capitals like Brazzaville, in the Republic of Congo, which offers little business.⁷

The cost of running Ethiopian Airlines is indeed low, probably because it is owned by the state. The airline, however, behaves like an international firm, and not like a national carrier. This means that it takes no subsidies from the national government.  Its management is also independent, even though only a few people will doubt that its senior executives has ties to the ruling Ethiopian Peoples’ Revolutionary Democratic Front. There is a high possibility that the airline will soon become the continent’s first pan-African airline. Naturally, it is not surprising that it is opening more centers  in Malawi and Togo.⁸ It is also teaming up with smaller rival airlines in the region. But the airline management understands that maintaining their lead in the region will not be easy. This is because it has strong rivals in the Middle East, particularly the Qatar Airways. These Middle East rivals also has large footprints in Africa, and are expanding their operations in the continent. Ethiopian Airline also faces other problems, such as poor infrastructure. Last year, the country started a new four-runway airport outside Addis Ababa. While this new airport may improve matters for the airline, no one really know when it will be opened for business.⁹  Another problem has to do with the political instability in the neighboring country, which may affect the airline’s sales revenue. It should be noted here that Ethiopian Airlines was founded in the 1945. But it started full operation after 1991, a period that marked the end of the country’s civil war. If the experience of the past two decades teaches us anything about Africa, it is that Ethiopian Airline could  take a hit if the country become mired in political instability. I pray that it will not be in that situation.

Pass the salt, please

The first  problem I had with Ethiopian Airline had nothing to do with the airline per se. On the contrary, it had everything to do with the country’s international airport at Addis Ababa. The airport is antiquated. It doesn’t have good facilities for old people and for people with disabilities. I surprisingly watched when an elderly woman who, I believe had mobility problem,  was literally carried up the escalator by the airline attendants. The transfer at the airport was also not a good experience: my connecting flight to Nigeria was delayed with not information and we had to wait for almost two hours before it arrived. The waiting area was so crowded that I was lucky to find a seat. Another bad thing I observed during the flight had to do with the air hostesses. In my view, they need more ‘customer service’ training. During the flight, I  saw several passengers request assistance by pressing the button on their seats. Only a few of them were attended to. It appears that the air hostesses  prefer to assist the customers only  during those times scheduled to serve meals and drinks.

That aside, my overall assessment of the airline can be stated in three words: It was good! I mean, the food they served was good. They served salmon and rice!  They were also generous with their food: I lost count of how many times we ate during the flight. But I can tell you this: by the time we reached Enugu, I was so full I could hardly walk. They even served wine, on request, during the flight.  The airline is affordable too: even though I travelled during the Christmas season when other airlines were hiking their fares, I paid only $1,700 for a round trip to Nigeria. The way I see it, I will probably fly on Ethiopian Airline again. The bottom line: In Africa, airline companies have bad reputation. So, it is a good thing that Ethiopian Airline is a visible success in a sector more notable for its failures in the continent. 

References

¹Akoni, O. (2016, May 16). Deplorable Apapa-Oshodi Expressway: Lagos Agencies Footdrag, Despite Ambode’s Order. Vanguard. Retrieved March 1, 2017 from http://www.vanguardngr.com/2016/05/deplorable-apapa-oshodi-expressway-lagos-agencies-footdrag-despite-ambodes-order/

²Ban on okada, keke will affect Nigeria’s economy – Amaechi. (2017, March 1). Nigerian Eye. Retrieved March 1, 2017 from http://www.nigerianeye.com/2017/02/ban-on-okada-keke-will-affect-nigerias.html

³(2017, March 1). Retrieved from Enugu State Government. Retrieved March 1, 2017 from http://enugustate.gov.ng/index.php/elements-devices/

⁴Industry Profitability Improves. (2017). International Air Transport Association , pp. Retrieved March 2, 2017 from http://www.iata.org/pressroom/pr/Pages/2016-06-02-02.aspx

⁵African Airlines: Well-Connected. (2016, October 22). The Economist, p. 58.

⁶Udo, B. (2017, February 9). UPDATE: Nigerian Govt. Takes Over Distressed Arik Airlines, Appoints New Management. Premium Times, pp. Retrieved March 2, 2017 from http://www.premiumtimesng.com/news/headlines/223041-update-nigerian-govt-takes-over-distressed-arik-airline-gives-lifeline.html

⁷African Airlines: Well-Connected, op. cit., p. 59

⁸Ethiopian: History. (2017). Retrieved from Ethiopian Airline: Retrieved March 3, 2017 from https://www.ethiopianairlines.com/corporate/company/about-us/history

⁹African Airlines: Well-Connected, op. cit., p. 59