Air Tanzania wants fleet ownership change, debt clearing

Air Tanzania (TC, Dar es Salaam) managing director Ladislaus Matindi has spoken out about the state-owned airline’s fleet ownership structure, which he says is affecting its operations and ability to clear its debt.

He was speaking at a ceremony at Dar es Salaam on July 30, attended by President Samia Suluhu Hassan, to welcome the carrier’s latest DHC-8-Q400, C-GPPU (msn 4624) – to be re-registered as 5H-TCK. The aircraft was originally due to be delivered in December 2020. It is the ninth of 11 aircraft to be bought and owned by the TGF – Tanzania Government Flight on behalf of the airline. TGF manages all Tanzanian government aircraft, which it leases to Air Tanzania. “This kind of structure does not allow us to make certain business decisions such as increasing our fleet,” he said. His views were echoed earlier this year by transport minister Leonard Chamuriho, who said Air Tanzania wanted to re-negotiate aircraft lease terms with the TGF.

Matindi also highlighted the airline’s inherited debt pile, “which means most of our earnings end up in servicing the debts.”

Matindi also requested that the National Treasury return to Air Tanzania the 20% of shares it previously held in catering firm Sky Chef. “We request that these shares be returned to Air Tanzania to improve our financial position,” he said.

As previously reported, Air Tanzania recently was granted a TZS450 billion shilling (USD194 million) state bail-out to continue operations and bankroll its fleet expansion as set out in its five-year strategic plan ending 2021/22. Reacting to Matindi’s remarks, President Hassan acknowledged she had obtained the plan and expected to consult her advisors on the way forward.

Considering its geographical location, Matindi said Air Tanzania aimed to have a fleet comprised of short-haul, medium-haul, and long-haul aircraft. With the arrival of the Dash 8, he said the airline now operates five 76-seater DHC-8-Q400s, two A220-300s, and two 262-seater B787-8s. Two more A220-300s are expected in October. According to the ch-aviation fleets advanced module, the airline also owns one DHC-8-Q300, one F50, and one F28-3000, all out of service.

Matinda said Air Tanzania’s MRO hangars at Kilimanjaro airport had been upgraded for home-based repairs on the B787 Dreamliners, saving the airline more than USD1 million.

Air Tanzania’s routes had grown from four to 15, including Moroni Int’l (Comoros), Entebbe/Kampala (Uganda), Harare Int’l (Zimbabwe), Lusaka (Zambia), and Guangzhou (China), but Bujumbura (Burundi) and Johannesburg O.R. Tambo (South Africa) had not yet been re-introduced due to COVID-19 travel restrictions.

He also listed Air Tanzania’s successes, its re-entry into international partnerships, the reintroduction of an international ticketing system, and the passing of the International Air Transport Association (IATA) Operational Safety Audit (IOSA).

The government planned to acquire more aircraft and to grow Air Tanzania operations across Africa and intercontinentally, including to Lubumbashi and Kinshasa N’Djili (DRC), Ndola (Zambia), Nairobi Jomo Kenyatta (Kenya), Dubai Int’l (UAE), Muscat (Oman), and London Heathrow (UK).

President Hassan said Air Tanzania had increased the number of passengers carried per month from 4,000 in 2016 to 60,000 in 2021. The airline dominated 73% of the local market, an increase by 2.5% from 2016.

She said the government was also cognisant of the importance of buying freighters to explore opportunities in air cargo.

Hassan underlined her government aimed to strengthen the country’s air transport sector as a stimulator of economic growth. She noted the country was determined to increase its tourist numbers to five million by 2025, up one million from 2016. “Our country is also focusing on increasing the volume of exports, and the only way to attain that target is to ensure availability of a vibrant national carrier,” she said.