Monday, October 15, 2012

■ KENYA: Its Game On as Jambo Jet granted Air Service Licence; FastJet's A319s approved by KCAA.

Kenya AirwaysFastjetThe battle for the East African aviation market today heated up significantly when the Kenyan Civil Aviation Authority (KCAA) dually announced the granting to Kenya Airways (KQ) of regulatory approval in the form of an Air Service License for the launch of its low-cost subsidiary, Jambo Jet, whilst at the same time, it granted FastJet certification for the use of its Airbus A319s in Kenya.

Fly540; FastJet's predecessor (In2EastAfrica)
Fly540; FastJet's predecessor (In2EastAfrica)
Listed under "Kenya Gazette Vol. CXIV – No.99 Dated October 12, 2012 | "The Civil Aviation Act - Decisions of the Kenya Civil Aviation Authority on Applications for Air Service Licences," JamboJet's licence is granted for one year with effect from September 27, 2012. The nascent LCC will now join the ranks of other carriers such as 748 Air Services (SVT), Air Kenya (P2), FlySAX, Jetlink (J0) and Fly540 Kenya (5H), set to morph into FastJet in coming weeks, in serving both the domestic Kenyan and regional East African markets.

With FastJet last week announcing its initial route offering to be a thrice daily Dar Es Salaam - Nairobi there and back service, Jambo Jet have thrown their hat into the circle and gone all out with a strong domestic and regional presence to include:

Jambo Jet's first destinations in Kenya are slated to be:
  • Wajir
  • Eldoret
  • Kisumu
  • Mombasa
  • Lamu
  • Malindi
While its regional routes will start with:
  • Dar-es-salaam, Mwanza, Zanzibar, Pemba and Kilimanjaro (Tanzania)
  • Entebbe (Uganda)
  • Addis Ababa (Ethiopia)
  • Antananarivo (Madagascar)
  • Bujumbura (Burundi)
  • Kigali (Rwanda)
  • Hargeisa (Somaliland)
  • Juba (South Sudan)
  • Goma and Kisangani (Democratic Republic of Congo)
  • Moroni and Dzaoudzi (Comoros Island)

With both carriers competing for the lucrative, albeit underexploited East African LCC market - East Africa’s use of LCCs sits at roughly 9% compared to an overall African penetration of 12% - their innovations and marketing will necessarily be cut throat. Last week, Kenya Airways’ CEO Titus Naikuni said that Jambo Jet would match FastJet on ticket prices in a looming battle to control regional routes:
We will match that price, given that it is the reason we want to launch Jambo Jet. We will keep our costs down to allow us to make flying affordable to even people who would otherwise go by bus,” Kenya Airways chief executive Titus Naikuni told Smart Company in an interview.

FastJet, however, has decided to go after lucrative embassy, oil and mining industry contracts, to boost its revenues, though its primary focus remains a "pent-up market for visits to friends and family":
We’re applying European standards whether required or not and making reliability the selling point, which is attractive to lots of customers,” FastJet Chief Executive Officer Ed Winter said. “Business travellers want to be first through immigration and first on and off the plane, especially in Africa, so we need to offer allocated seating.

Kenya Airways, Embraer's 900th E190 5Y-FFC
Kenya Airways latest and Embraer's 900th E190
Fleetwise, FastJet is close to securing a deal for several more Airbus A319s to supplement its current lone A319 leased from BBAM LLC, formerly Babcock & Brown Aircraft Management. The company aims to have five A319s in operation within six months and 15 by the end of the first year of operations. Jambo Jet, will likely make use of ten of Kenya Airways' burgeoning fleet of Embraer E170s which will likely prove cheaper to operate on Jambo Jet's thinner routes to places like Lamu and Eldoret.

With Emirates too, set to add fuel to the fire by establishing partnerships with Africa-focused low-cost carriers to act as feeder airline's to its Nairobi, Luanda and Accra routes, the East African aviation scene looks set for some dramatic future developments.