Valediction – Chris Zweigenthal Hopes For 10% Of Global Passenger Marketshare In Africa In 10 Years

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Mr. Chris Zweigenthal is the immediate-past Chief Executive Officer of Airlines Association Of Southern Africa (AASA). In this valedictory interview with Aviation & Allied Business Journal, he relives the progression of the industry over the decades of his service, and offers insights on the way forward for the industry in Africa amidst the COVID-19 pandemic.

 

Chris Zweigenthal, outgoing CEO, AASA

Q: You recently bowed out as Chief Executive Officer of the Airlines Association of Southern Africa (AASA); what was your experience like at the helm of AASA, and did you accomplish your targets as chief executive officer?

A: The broad mandate of AASA provided me with the opportunity to work across the entire aviation business spectrum from policy development to operations to customer focused issues, and across most disciplines. It was challenging but very rewarding as one got the opportunity to work with many different aviation experts, suppliers and service providers, from the most senior to the most junior in Government, public and private organizations. I also had the privilege of working with a great supportive team at AASA. The duration of the projects and initiatives varied greatly. External factors such as changes in the economic climate and more recently, the pandemic, influenced the ability for some projects to be completed. However, we would continue to pursue the achievement of results in the best interests of our members.

 

Since I joined the airline industry, there have been many challenging times brought on by some significant global events which have impacted our industry. These include the oil crisis of 1990, the 9/11 tragedy in the USA, the global economic crisis of 2008/09 and more recently the Coronavirus pandemic of 2020.

Notwithstanding, throughout this time, the airline industry in Africa has shown a remarkable resilience to continue providing the travelling public with air transport services, whilst facing challenges of financial viability. Through this time, business models have evolved with the emergence of the low-cost carrier to respond to customer requirements of reducing the cost of travel. Africa has also embraced these new developments. However, the challenge remains for the African airline industry to become sustainably profitable.

 

Q: As airlines face the debilitating consequences of the COVID-19, what do you see as best way out for AASA and African airlines?

A: Following the devastating impact of the COVID-19 pandemic where during lockdown, international traffic was prohibited and domestic travel was either also prohibited or significantly restricted, we have seen a number of false restarts to air transport particularly for international flights. It is now essential that restrictions on commercial scheduled air transport are removed on a global scale and that States apply consistent measures according to recognized protocols and guidelines to enable the recovery of air transport to start and continue without fear of re-imposed restrictions.

 

Unfortunately, without consistent application of protocols, customers will not be confident to make reservations due to uncertainties and financial risk due to the imposition of travel restrictions often at short notice. This is a very real experience in Africa where many foreign States have imposed restrictions on States in Africa and this has negatively impacted African airline scheduled services. Due to reduced revenue, airlines have had to review their business models to strip out costs, adapt their schedules and become more flexible to satisfy changing demand due to the pandemic restrictions.

 

Q:Member airlines of AASA appear to be worse hit by the financial challenges, what would you put this down to?

A: Member airlines of AASA operate from within the SADC region.The initial hard lockdown in April and May 2020 included both domestic and international travel and there was a gradual return of domestic services from June 2020 and international services from October 2020. With a few exceptions, most SADC States followed this timetable, whilst in other regions and also internationally, there was not a total lockdown of all services with particular domestic services allowed to operate in some States.

 

The international travel ban by many States imposed on South Africa during its second wave in December 2020 – the ban has continued well into 2021-, has negatively impacted the recovery of traffic throughout the SADC region. With approved protocols and regulations in place in line with WHO and ICAO guidelines, it is now essential for States to be consistent in their application of measures and regulations to give visitors confidence to travel and visit our countries.

 

Q: In practical terms, how can the Single African Air Transport Market (SAATM) work in Africa, given that several States still delay practical implementation?

A: As much as we would like to see a full continental-wide implementation of SAATM, it is probably unrealistic to have expected all African States to sign the SAATM commitment by now. However, AFCAC, as the Executing Agency, must be supported with the implementation of SAATM between those States which have committed to SAATM.The success of such implementation and the positive impact of improved connectivity and growth of traffic within and between those States, should lead to greater acceptance of SAATM and encourage more States to join SAATM.

 

Q: Do you foresee the emergence of a big airlines alliance in Africa regionally or continent-wide?

A: International big airline alliances such as Star, One World and SkyTeam alliances are well established and many of the large airlines of Africa are already members of these alliances. It is unlikely that airlines in Africa will form a separate large alliance. However, this does not stop African airlines from developing cooperative and commercial agreements with the objective of further growing intra-Africa connectivity.

 

Q: What are the prerequisites for the African Continental Free Trade Area (AfCFTA) to work productively with aviation industry in Africa, and what are your assessment and expectations in this regard?

A: The AfCFTA objectives are to create a single continental market for goods and services, the expansion of intra-African trade and to enable free movement of business people and investments within Africa. The SAATM and AfCFTA initiatives should complement each other in facilitating movement of people and goods across Africa, effectively reducing the cost of production of goods and improving the competitiveness of African goods and services.

 

Q: Africa’s very high taxes, charges and fees have been described as the worst challenge of African airlines; how can governments be convinced to urgently address these costs?

A: Taxes, charges and fees are often a source of a foreign exchange revenue for States, particularly in Africa, where they are on average higher. It is therefore only natural to keep such taxes and charges in place to maintain this revenue. However, this raises the cost of travel and consequently makes air travel less affordable in Africa – this is one of the factors that contributes to the fact that passenger traffic in Africa is only around 2% of global traffic.

 

Industry needs to be able to demonstrate that the liberalization of African skies through SAATM and AfCFTA, together with the reduction in taxes, charges and fees, will stimulate demand and lead to an increase in traffic, revenue to airlines, infrastructure service providers and the States.   Ultimately, it would be ideal to show that increased air services and passengers would have a consequential positive impact on the States GDP through improved travel and tourism and justify a reduction or even removal of taxes and a more realistic determination of user charges and fees.

Q: As the industry evolves with new technology alongside Africa’s young population, what is your expectation in Africa’s aviation development?

A: The COVID-19 pandemic has shown us that our industry needs to embrace new technology, digitization and systems, leading to a self-service, touchless airport and passenger handling environment. African aviation must follow this global trend if it wishes to compete within the global industry. This will require a necessary investment by all stakeholders but should deliver appropriate returns through increasing numbers of a new generation of passengers who embrace such technological development.

Q: How can Africa increase its share of global passenger and freight traffic which are both currently less than 2%?

A: African aviation has not exploited its full potential. With around 15% of the world’s population and 2% of global traffic in Africa, there are so many opportunities to increase its market share. From a domestic and regional perspective, and given rail and road infrastructure challenges, aviation would appear to be the natural vehicle to develop connectivity between cities and States in Africa.

However, whilst issues such as high costs, taxes, fees and charges, and the lack of new technological development play a role in lower-than-expected growth, the internal focus on survival which existed pre-COVID and which has unfortunately been exacerbated by the COVID-19 pandemic, whilst understandable, is hindering the industry from exploiting the huge potential that exists to close the population and market share percentage gap across Africa which occupies 20% of the earth’s land mass. African airlines will have to adapt to a post-pandemic environment and all service providers must provide the necessary infrastructure and services to ultimately serve the passengers’ needs.

 

Given that economic recovery and growth must take place across Africa post-pandemic, African aviation should aim for double digit growth to provide a springboard for African aviation to increase its market share in global aviation.

 

Q: What do you look forward to as you as your next step now you have retired from AASA?

A: I retire from AASA and look forward to spending some quality time with my family who live in the USA. However, my heart will be with Africa and in particular in the aviation industry which has played such a pivotal part of my working life. I will certainly retain an interest in the development of aviation in Africa and around the world, and will look for ways that I can contribute in some way to see the realization of a sustainable aviation industry in Africa.

 

Q: What do you hope to see in the aviation industry in Africa over the next 10 years?

A: In 10 years, I hope to see an industry that is profitable, competitive, with an expanded network, providing a cost-effective reliable air transport service both for passengers and cargo.

 

I hope to see an environment where States are aligned in their strategies for aviation, and appreciate the value that aviation adds to their economic growth, development and the well-being of their citizens. I hope to see an environment where Africa’s market share has grown to 10% of the global market and created a base for further growth to increase its market share.

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