Wednesday, May 2, 2012

► EGYPT: Egyptair profits fall 75% in 2011; considers 787s & A350s for renewal.

After a very turbulent year in the country and the region as a whole, Egyptair's (MS) profits for 2011 unsurprisingly fell over 75% to USD$13.6million.  

The chairman of EgyptAir, Hossam Kamel, said the airline's operations were severely interrupted during the Egyptian Uprising of 2011, forcing the cancellation of numerous flights, thereby leading to a decline in tourism (Egyptian tourism was down 32% on 2010 according to official statistics). Additionally, the global rise in the price of oil as a direct consequence of the Arab Spring also ate into profits, as did a partial strike in September by EgyptAir Ground Services employees at Cairo international airport, following rumours that concessions they had previously won by strike actions would not be implemented.

A similar trend has been seen in neighbouring Arab airline Royal Jordanian, whose operations have been severely hampered by the civil unrest in neighbouring Syria, and previously, in Egypt.

To help bring the airline's profitability back up, Mr Kamel stated that cost cutting measures had already been implemented, whilst the airline would focus more on increasing frequencies to served destinations, as opposed to opening new routes. He added that Egyptair would press ahead with its new Cairo-Toronto route in 2013, and that "several other destinations" were under consideration.

With regards to future fleet renewal, he added that Egyptair is considering replacing its Boeing 777s and Airbus A330s with 787s and A350s between 2020-2025.

Negotiations are underway with fellow Star Alliance partner Ethiopian Airlines to create a new base or a new joint carrier based in Accra, Ghana, where Ethiopian currently has a presence under its ASKY Airlines brand.