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WoldeMariam Hailu is the Chief Executive Officer (CEO) of one of Africa’s successful airlines, ASKY. The airline is one of the most reliable airlines that has grown massively since it was established 13 years ago. In this interview, he speaks about the profitability of the airline, his ability to fulfill its mission and vision, and his plans for the burgeoning Nigerian travel market among others. Excerpts
How profitable is ASKY considering that it has been around for more than ten years?
ASKY was established in the year 2010 and now it is 13 years young and is a profitable airline. It is not only profitable in terms of economics, but it is also profitable in terms of fulfilling its vision and mission of connecting West, Central, South, East Africa with each other and connecting people and goods, and cultures. So, it is profitable in all dimensions.
How has Asky fulfilled this vision?
First of all, the commercial tagline for ASKY is the Pan-African airline. By saying this, we are not just invoking slogans, we mean what we say in ASKY. ASKY is a real Pan-Africa, number one. By connecting people from Cape Verde, from the westernmost to Kenya, Nairobi from the easternmost to Niamey, Niger from the northern, and Johannesburg, South Africa the Southernmost. And just about anywhere else in between 28 destinations. This means West, Central, South, and East Africa, building one of the largest networks connecting Africa. That means serving the Pan-African initiative, the Continental Free Trade Agreement, and before it is even being fulfilled, the Single African Air Transport Market (SAATM). So, this is one of the Pan-African attributes of ASKY, by the sheer network architecture. It shows Pan-Africanism. Number two, look at ASKY’s name. ASKY means African Sky. Look at the colour of the logo. The gold and the brown. The brown is the brown colour of the Africans. The gold is all the minerals and the gold which is in Africa, be it in Ghana, Mali, Niger, and elsewhere. Number three, ASKY is Pan-African because ASKY is employing pilots and cabin crew from Senegal to Chad to Ghana to Gabon to Benin to Togo to Niger and from everywhere. Even from Nigeria, from Sokoto to Maiduguri, to Ogun State, and to Abia State, all geopolitical zones. In fact, the largest concentration of pilots flying as ASKY are from Nigeria. So this shows you that ASKY is Pan-African in terms of its employment opportunities, in terms of its brand, look and feel, and logo, in terms of its network. It is living true to its claim. It does not deny its claim of being Pan-African.
How profitable is ASKY, at least in West Africa?
You know, Western Central Africa, is a high operating cost medium. So for ASKY to make a profit, ASKY needs to struggle. There are two components for profitability. The top-line revenue the middle-line cost and the bottom-line profit. The top-line revenue is uncontrollable because it’s exposed to competition. So, competition is external, all players are there. They dump their prices; they do all kinds of things to compete, to take market share. So that is uncontrollable. ASKY is endeavoring to remain profitable because it strictly controls its middle line, the cost. It has a high regiment of cost control. Because of that, it makes profits. That helps ASKY to plow back part of the profit as an incentive to the travelling public to produce a single unit cost of available seat-kilometer, a single seat on the aircraft to be produced at the minimum cost to be able to sell it. That is how Asky struggles to be profitable.
How independent is your airline or is it beholden as a feeder airline to Ethiopian Airlines?
Well, ASKY is an independent airline. It is the son of its own father. As an African airline, it is a private commercial company owned by shareholders. Of course, Ethiopian Airlines is part of the shareholders. But ASKY has got its own board, its own network. ASKY and Ethiopian Airlines have a very beautiful commercial relationship. They feed each other. They have shares. They have a special corporate agreement. Because Ethiopian Airlines is the bigger brand, ASKY being associated with Ethiopian Airlines has given ASKY a very good commercial dividend. Otherwise, ASKY is a company of its own, with its own shareholders, and with its own board. So, it’s an independent commercial company.
How has ASKY grown in 13 years? How did it start and how has it grown over that period?
ASKY started from a humble beginning. It was operating Bombardier Q400s, which are Turbo props aircraft with ultra-narrow bodies. Now ASKY has migrated into a jet engine. It is operating B737 MAX, B737-800, new generations. It now has 15 aircraft and 28 destinations. ASKY has diversified its network all the way to East Africa, Kenya, Nairobi, all the way to South Africa, Johannesburg, all the way to the westernmost part of Praia Cape Verde, and a big network of 28 destinations. So ASKY has grown within the last 13 years. It has outgrown its humble beginning of a regional operator and has truly become a pan-African airline.
How does ASKY fulfill this promise of a Pan-African airline when it doesn’t cover most of Africa?
Well, ASKY is now covering many of the sub-Saharan African major markets. It has a plan to widen its network to places where it is not currently going. ASKY also has a plan to diversify, crossing the Mediterranean to go to Paris, Madrid, and other places.
Nigeria is the major market for ASKY, what is the relationship?
Nigeria is the leader of Africa in many contexts. Number one, it is the largest African population and it is the biggest economy. It has the largest aviation traffic, and the traveling public is highly mobile. The traffic of more than 230 million population; very young population, highly mobile. So, ASKY is highly desirous to serve the Nigerian public as it continues to do right now. Nigeria is a very good host. Number one, the Nigerian customers are patronizing ASKY and ASKY is fulfilling its promise to the Nigerian public by serving Abuja and Lagos. ASKY wishes to cooperate with the local Nigerian operators to have commercial agreements so that they can connect the traffic from all the geopolitical zones of Nigeria and feed ASKY either in Abuja or Lagos so that it can convey that to the vast network within the continent of Africa. The Nigerian government, the Nigerian Ministry of Aviation, the Nigerian Civil Aviation Authority, the Federal Airport Authority of Nigeria, the Nigerian Air Space Management Agency, and the Nigerian travel agency community, are very good partners and regulators to work with, so ASKY feels very much at home in Nigeria, as it is an African brand.
You started flights to South Africa, you have started in Nairobi. How well have you done in these markets?
Well, these are some of the big spots on the continent of Africa. South Africa, we started last year. Nairobi, it is just the beginning of October, so it’s a couple of months. South Africa is doing well in terms of traffic. The yield in South Africa is very low because of high competition, so we need to work on that. And Nairobi is catching up. It’s a very good market because Nairobi has corporate traffic and leisure traffic. Also, we are bringing tourism into Kenya and we are bringing corporate business from Kenya to the rest of Africa. So, it is doing well.
Where else in Africa do we expect you to turn up?
Well, in the near future we would like to expand to Khartoum, Cairo, Casablanca, and Mauritania into such places.
How soon would that be?
When as soon as resources allow. You know having an aircraft now, global aviation is highly recovering from the COVID pandemic depression. Now, the cost of ownership for an aircraft is very formidable. As soon as we have enough resources, we would like to diversify, to widen our network to those places.
You talked about crossing the Mediterranean. What is your vision for Europe?
Well, Europe, you know, the Francophone Africa, everybody’s dream is to travel to Paris. So, Paris is one of the natural destinations that Asky would like to serve. Spain, Madrid, and Lisbon, Portugal also. These are some of the spots that we are targeting.
Any plan for America?
Right now, America is a big leap. It requires a big wide-body aircraft because it’s more than six hours to seven, eight, and nine hours to the east coast of the United States. So it requires wide-body aircraft and having wide-body aircraft is also very expensive. Right now, we are serving the US route seven times a week to Newark and three times a week to Washington DC in collaboration with Ethiopian Airlines. ASKY is putting its commercial hub on Ethiopian Airlines-operated flights. So ASKY flights can be sold to America right now in cooperation with the culture of Ethiopian Airlines. But in the future, that is also one of our targets.Google+