How new Uganda Airlines can make profit

When Mark Zuckerberg visited Kenya in 2016, he made a pitstop at Mama Oliech restaurant in Nairobi. Then all of a sudden, this eatery’s popularity skyrocketed just because the Facebook chief executive officer (CEO) chose to have lunch at an ordinary location which offers authentic African cuisine. People enjoyed watching him savour his food with bare hands and that moment was immortalized forever as can be seen on the restaurant’s menu cards.
Subsequently, notable global executives and dignitaries have since emulated the Facebook CEO by flocking the restaurant every time they have a chance of visiting the Kenyan capital. You can see portraits hanging on various spots of the restaurant’s wall. What point am I trying to make and how is this related to running an airline company?

First of all, Mama Oliech’s food isn’t that finger-licking good.
For as long Mark Zuckerberg remains a billionaire, he will never fly on a commercial airline.
However, if someone were to whisper in his ear that there is a certain airline in Africa that offers a completely different flying experience than what he has ever seen in his entire life, he would most probably park his Gulfstream and give Uganda Airlines a try.
However, for this to happen, I believe the following aspects need to be well handled by the people who are going to run and manage the new national carrier:

Why now? Where do we want to go with Uganda Airlines? What is the government’s strategic direction?
What is the mission statement and vision of Uganda Airlines? What are its core values, philosophy? Is this someone’s pet project or is the entire nation rallying behind this initiative? Have there been awareness campaigns to sensitise the masses about this in order to garner support or is it another nefarious and dubious ruse to defraud the country of tax payers’ money? I don’t have the answers to any of these questions. Whatever the reasons or motives behind the revival of Uganda Airlines are, if they are of patriotic nature, then the onus is on the government of Uganda (if at all the plan is for the government to own it) to convince Ugandans that this is a better direction the country needs to take as opposed to, for instance, improving the salaries and livelihoods of doctors, nurses, teachers and university lecturers.

Safety and security
You could probably steal a plane’s side mirror and sell it at a premium in Kiseka Market because anything can be stolen in Uganda, it doesn’t matter the time of day or night.
Right from the onset, Uganda Airline’s safety record will register zero mileage and this is going to remain the case for a very long time. In the airline business, it doesn’t matter whether your planes are straight from the manufacturer’s hangar, an impeccable safety record takes decades to build.
Moreover, there are no shortcuts in this industry. You cannot approach this business the same way you do a ministry or another government agency. The junk choppers saga is still fresh in my mind.
Repetition, repetition, repetition. I know, it is boring. Aircraft maintenance and safety procedures are not only costly but are an absolute necessity and unfortunately, these cannot be left in the hands of lazy people. Otherwise why not spend the money on upgrading the old taxi park instead? It is cheaper and shortcuts abound with minimum risks to people’s lives.
At the core of airline safety is the presence of competent engineers and technical professionals who understand every aspect of aircraft maintenance and respect this industry. For every type of aircraft that an airline owns, there should not only be a team of dynamic and competent engineers and technical professionals, there should also be a fully-fledged warehouse, adequately and consistently stocked with every single spare part of the aircraft. Had the government opted for a wet lease to acquire new aircraft, part of the options would have been a package consisting of the lessor providing all the requisite technical know-how to maintain all the leased aircraft to acceptable international standards. Since the government has decided to go the outright purchase route, it is safe to assume that this team of professionals has already been recruited and are on standby ready to be part of this exciting, yet challenging journey of being part of a potentially remarkable team.
Should there be any slack of any nature regarding safety and security, I can promise you, there is going to be numerous crashes and loss of innocent lives, there are no two ways about it. You are either in it all the way, with both feet or completely out!

The brand
To this day, when you mention Uganda, some people (depending on which part of the world they come from) will utter Idi Amin (RIP). Others will remember the plot in Raid on Entebbe or 7 Days in Entebbe. At least they no longer say Africa is one big country.
Enter Uganda Airlines. It is synonymous with failure - twice over. That is not a good image to renew with. It is going to be a gargantuan task to build a completely new brand that is associated with national unity, pride and a sense of class. To begin with, the choice of livery should surprise everyone who is already biased that it will collapse again. The hard part of building a strong and lasting brand will follow suit.

Professionalism
Professionalism will be key in rebuilding the Uganda Airlines brand. Unfortunately, this sector faces such immense cutthroat competition that you cannot afford to accommodate nepotism or tribalism. Competence should be the lifeblood of the company, failure of which will snowball into assured bankruptcy and complete halting of operations.

Training
A fully-fledged training academy is one of the ways to ensure uninterrupted continuity and successful operations in the aviation industry. Hinged on the core values and philosophy, the training academy ensures that all employees breathe the same air and speak the same language, literally. This ensures that the airlines’ mission, vision, core values and philosophy are engrained in the employees’ DNA. For instance, even if a pilot has more than 50,000 flying hours, if he or she has never flown a Bombardier plane, the company’s policy should dictate that the pilots pass through the mandatory orientation to master the operation of planes that they have never flown before. It goes without saying that the configurations of a Mercedes are totally different from a Toyota.
To give you more perspective, it is anticipated that by 2030, the world will need more than 600,000 pilots to meet the growing number of global air travellers. This presents a huge opportunity for the country’s decision makers to set up a world-class training academy and make it accessible to any Ugandan who dreams of one day becoming a pilot.

Social media presence
Social media is a massive jungle. It is a bottomless ocean. It has become the new word-of-mouth. The reputation of people, countries and companies has been tarnished. Fake news and alternative facts have propagated faster than stubborn epidemics. Innocent people have been character-assassinated although they continue to live. Social media contributed to the Boeing 737 Max 8 being referred to as the most unsafe airplane in the aviation history. Against this backdrop, it is imperative to recruit an army of social media professionals who can counteract any attacks faster than the speed of light.

However, let’s not forget that traditional media platforms such as radio and television still play an important role in creating brand awareness and dispelling malicious rumours. My grandmother doesn’t own a smartphone, but she still listens to radio, watches television and occasionally stumbles upon different billboards along the road.

Hub
There is a rumour making rounds that the reason why a group of lobbyists in neighbouring Kenya are pushing to merge Kenya Airways and Jomo Kenyatta International Airport (JKIA) is so that the Kenyatta family can eventually take full ownership of JKIA. Does this motive sound familiar?

According to the International Civil Aviation Organisation, in 1970, there were 310 million air travellers. In 1990, 1 billion people travelled by air. This number doubled to 2 billion in 2005. The number of people who boarded a commercial plane was 3 billion in 2013. Four billion people flew in 2017 and this number is expected to increase to 8.2 billion by 2037.

I don’t know if this is the magic figure that prompted the government to wake up from its slumber to launch the revival of the national carrier. Building a world-class hub is, therefore, a strategic step that the government will need to consider because all these passengers will need to be transited from one destination to the other through a hub.

The home of the new national airline will definitely be at Entebbe International Airport. However, the current airport infrastructure at Entebbe is inadequate for it to play the role of a hub. The government will, therefore, need to readjust the proposed expansion plans and incorporate all the necessary blueprint for the airport to serve as a hub.

Business class lounge at the hub
Unfortunately, a dedicated business class lounge will need to be built at the preferred hub and my assumption is that this will be at Entebbe International Airport.

Customer loyalty programme
What will Uganda Airlines frequent flyers be able to do with their accumulated miles? For starters, I would make it impossible for any passenger on board to pass the chance of enrolling for the frequent flyer programme.

A partnership with Uber where miles can easily be converted into a trip from a traveller’s disembarking airport to their place of abode could be one of the ways of making the acquired miles useful. You could also convert accumulated miles into promotional codes that could give customers discounts when shopping on famous online stores. There is a plethora of ideas that the new management at Uganda Airlines can think about.

Choice of planes
Successful airlines always make purchase decisions many years in advance based on factors such as slot availability, load factor and maintenance costs.
This means there is a deliberate planning effort that happens behind the scenes. In the case of the new national carrier, choice of planes should have been a factor of the routes that management has determined that they will launch with and those that they wish to expand to in the near future. For example, Emirates currently only owns Airbus A380s and Boeing 777s in its fleet to ensure streamlined operations.

It wouldn’t make economic sense to acquire long range aircraft only to use them for short-haul flights.
We can only hope that the planes that the government has rushed to purchase will allow the national carrier to operate efficiently and shorten the learning curve.

It is also reported that there is a plan to acquire Airbus planes. Since Airbus recently opened its Airspace Customer Definition Centre in Hamburg, Germany, Uganda Airlines management could visit the manufacturer so as to have an idea of and discuss their desired cabin layout, class configuration, ambiance and request for specific aesthetic attributes they would like to see on all their Airbus planes.

Routes
British Airways makes more than a billion dollars annually from its London (Heathrow) to New York (JFK) route. Conversely, on October 3, 2015, British Airways concluded its last flight in Uganda. I wasn’t present at the time to witness the water canon salute at Entebbe International Airport that marked the end of one of the airline’s most unprofitable routes.
These anecdotes serve to guide management on the most profitable routes to focus on once services have launched. Two questions should come to mind when this is to be determined: Where do Ugandans want to go and how much are they willing to pay for it?

Price attractiveness
Leisure travellers by nature are very price-sensitive and they account for the biggest number of passengers. Therefore, at any point in time, a Uganda Airlines ticket to any destination must be cheaper than that from Africa’s biggest airliner.
On the other hand, business travellers don’t mind what they pay for a ticket for as long they get to their destinations the fastest way possible with minimum to no layovers and they get an excellent service on board.

That is some food for thought and should take into account the various code sharing agreements that Uganda Airlines will plan to arrange with multiple world carriers.

Code sharing agreements
I have an idea of which routes Uganda Airlines should be able to launch with and which companies it should sign code share agreements with. This will be a hybrid of the point-to-point and the hub-and-spoke models.

Airspace agreements
The air that you and I breathe is tax free; the same can’t be said about airtime. When it comes to international airspace, that is a completely different ball game. We are talking about national sovereignty. The government must have an idea of all the possible flight plans that the new airline company would like to launch with. Depending on the season of the year, some flight plans take longer routes due to factors such as weather and direction of the wind. The government will then have to secure authorisations to use or fly over the airspace from all countries along the flight plans of each flight.

This is part of a complex series of negotiations and agreements that are governed by the Freedoms of the Air. Even when you maintain cordial relations with a neighbouring country, you cannot take it for granted that you can use their airspace without permission. You do not want to know what Russians can do to you if you mess with them since they are not signatory to the International Civil Aviation Organisation’s Transit Agreement.

Guaranteeing a high payload
Assuming that Uganda Airlines is a government entity, and if I was given five minutes as President of this country, I would make it compulsory (and pass it into law) for all civil servants, students on international scholarships to depart from Uganda on a Uganda Airlines flight. Not forgetting our dear MPs. They might think that just because we address them as “Honourable”, they have a right to be excluded from that list.

Big data
Believe it or not, there is a lot of companies out there who are willing to pay a premium to understand your trends, your interests, your dream destinations, your purchase history, your search history as well as your travel history.

Airlines no longer need to look any further when crafting specific promotions since they are able to know with pin-point precision the routes that will guarantee the best returns. All this has been made possible thanks to Big Data.

Leasing Vs outright purchase
If you are starting with just three planes, why are you outrightly purchasing them? The huge discounts that large airline companies receive from aircraft manufacturers warrant them to opt for outright purchase. If you are starting out a new airline, there are so many uncertainties and quite frankly, you will not enjoy the same discounts as a big buyer, the mathematics will not permit it.

Another advantage of opting for leasing of aircraft as opposed to outright purchase is that in the event of mechanical issues with a plane which make it unfit to fly, the lessor would be obliged to provide an immediate replacement, which would guarantee smooth and continuous operations.

On the other hand, if for some reason there is a mechanical problem with one of the planes that you own and it is deemed unsafe to fly, chances are that for a nascent airliner, there would not be any available options causing disruption of flight schedules, even cancellations.

In-flight magazine
Perhaps the Nation Media Group could offer guidance on printing and publishing a dynamic magazine for the national airline. This is not my cup of tea, however, management will need to keep a highly motivated editorial team to keep running stories on this regular magazine.

The writer is an aviation specialist