Covid-19: air cargo saves Ethiopian Airlines

Here is a company which succeeded in saving the furniture. From March, Ethiopian Airlines sought to adapt to the surge in demand for air freight. This allowed it to cushion the shock of the pandemic which has seen passenger traffic fall by 90% worldwide. “We have been very fast, very flexible and agile in moving our forces and resources on freight”, explained its CEO Tewolde Gebremariam, recalling that in normal times “a good part of the air freight is provided by commercial flights” . “I would say that these interventions saved the company,” added the man who has headed the Ethiopian air group for nearly 10 years.

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Inventiveness and efficiency

To do this, Ethiopian has shown inventiveness. In addition to transforming 25 aircraft into cargo planes, by emptying them from their seats, it mobilized 20 other aircraft whose seats it kept, using the belts to secure the packages. According to diplomatic sources, Prime Minister Abiy Ahmed also did not hesitate to promote the freight services of the national company during his telephone conversations with foreign leaders. “Ethiopian was able to react with more agility than other companies because it has always been run like a business. The state plays a significant role, but there is very little state interference in the way in which the company is managed ”, decrypts Chiedza Madzima, head of operational risks for the research firm Fitch Solutions.

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An opportunity exploited: Addis Ababa, humanitarian hub

Ethiopian also benefited from the United Nations decision in April to open a humanitarian hub in Addis Ababa. To date, it has operated 360 cargo flights carrying Covid protective gear in more than 80 countries, according to its CEO. For Mr. Tewolde, air freight activity should remain strong, because “the commercial flights that we used to transport goods in the holds are not currently in service”. The company also plans to make “at least 40 devices” available to distribute the vaccine against Covid-19 around the world, when it is ready.

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Strategy of opening up to other companies

Ethiopian is even studying the possibilities of strengthening its links with other African companies, notably the dying South African Airways (SAA). “It is a good time to support other companies in the sense that we are in a better position,” explains the CEO diplomatically. “Some of us will survive, for others it won’t necessarily be the case. Some will need state aid, if it is available, others may need to restructure or downsize, ”said Tewolde. Ethiopian is participating in discussions on the future of the South African company, which has survived for years thanks to state aid. Mr. Tewolde explains that he made it clear to the South African authorities that his company was “not interested” in taking a stake in or helping to pay off SAA’s debt. “We told them that we could provide management, technical, fleet expertise and that we could work on a commercial collaboration to restart South African Airways. Ethiopian already has stakes in the Malawian carrier, Malawian Airlines, and in ASKY Airlines, a regional carrier that mainly serves West and Central Africa. It also owns 45% of the new Zambia Airways which, according to Tewolde, is due to launch “either in October or in November”.

No layoffs and an acceptable “profit”

Currently, African companies provide only 20% of flights to or from Africa, deplores the CEO. “Our objective is to reverse this market share, namely that African airlines (…) should take at least 50%” of the market, ambitions Mr. Tewolde. So far, the Ethiopian operator has not asked to be bailed out, has not laid off full-time staff and has not requested a postponement of payment of its debts, assures Mr. Tewolde. The company has already announced a “profit” of 44 million dollars for the first half of 2020, without however giving more details, the accounts having not yet been audited. The slow recovery in passenger traffic – the total number of flights is currently at 50% of 2019 levels – means the company remains in “survival mode”, according to its number 1.

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