Air Zimbabwe calls for cash to bring airline back in line

In submissions made to the Parliamentary Portfolio Committee on Transport and Infrastructure Development in Harare, Air Zimbabwe acting board chairman Eric Harid said the airline needs $331.97 million to lease or purchase aircraft, $11.4 million for human resources recapitalisation and $10.6 million for plant and equipment upgrades.  Additional costs include $7.5 million for the construction of new office infrastructure and $2.1 million to clear up debts owed to the IATA.

The airline also owes serving and forcibly retrenched workers $302 million in salary and terminal benefits arrears. It is presently paying workers only 40 percent of their monthly salaries, thereby accruing 60 percent in monthly salary arrears.  “We are currently paying human resources 40% and accruing 60% debts every month through our staff. Our staff and creditors have been suing us and as a board we hope we are able to tackle that,” Harid said. He added that the airline, which last made profit in 2003, recorded a loss of $44, 77 million in 2013 due to short routes, high fuel costs and the continued use of aged and ageing equipment. 

The highest operating costs on the company accrued from the fuel bill as the company was using fuel-intensive Boeing 737 planes for one and a half hours flights when they are meant to fly continuously for six hours.  According to Harid, the national airline has a total of 10 aircraft including three 160-seater Boeing 737, two 200-seater Boeing 767s, two Airbus A-320 each with a capacity of 160 people and at least three aging, Chinese-made MA 60 medium haul jets and a few smaller aircraft. 

Only one of the Boeing 737-200s is functional while the other two are in a state of disrepair. The airline operates a total of three functional aircraft – two Boeings and one MA-60. The two leased Airbus A-320 aircraft are due for re-delivery to Harare soon after spending six months undergoing special maintenance in South Africa. 

“Our core business is in three models, passengers, cargo and mail, but our greatest asset is people. The airline has got the following fleet: two Boeing 767 2RER which seats about 197 passengers and these are owned by Air Zimbabwe. Only one is operational while the second is undergoing final C-checks at a regional aircraft maintenance factory.  “Two leased Airbus A-320 aircraft, each with a capacity of 156 are both undergoing maintenance in South Africa.

“Of the three MA-60s, two are grounded while the only operational one is presently servicing the Victoria Falls-Kariba- Harare route which we re-opened in August last year," Harid said.  Despite spirited attempts, Air Zimbabwe has failed to attract joint-venture partners and financiers because it is heavily indebted while accusations of corruption and reports of financial scandals involving the company's former board members have forced potential funders to adopt a wait and see attitude as the new board settles down to work. 

The airline flies to only one regional destination - Johannesburg - with flights originating from Bulawayo, Harare and Victoria Falls. It also operates three regular domestic flights on the Bulawayo-Harare, Harare-Bulawayo-Victoria Falls and the Harare-Kariba-Victoria Falls routes.  Despite the bad state of its finances, Air Zimbabwe recently announced that it is negotiating with Canadian business jet manufacturer Bombardier for the acquisition of an undisclosed number of low-cost twin-engined, medium range, turbo-prop Bombardier Q-400 regional jets. Bombardier sales director for Africa and Middle East, Sameer Adam said the company will be happy to do business with the ailing Zimbabwean national flag carrier:  "We have seen that Zimbabwe is a market full of opportunities and we hope that if we manage to strike a deal with Air Zimbabwe we will be able to supply and introduce the latest technology in this market. We have over 110 Q Series aircraft in Africa and we would be happy to offer our services to Zimbabwe,” Adam told local media in Harare after the  Bombardier Q-400 jet made a maiden Zimbabwean test-flight from Harare to the resort town of Kariba and back.  Commenting on the ongoing negotiations with Bombardier Aerospace, Transport and Infrastructural Development Minister Obert Mpofu said Air Zimbabwe should seize the opportunity and take advantage of the high technology offered by Bombardier to rebuild its fleet back to a world class civil aviation service.  “Air Zimbabwe must take advantage of new technology being offered by Bombardier and select the most suitable aircraft for the local environment. Many companies have approached us with proposals for us to buy their planes and we are still considering them,” Mpofu said.  

According to its strategic business re-development model for the 2014-2016 period, Air Zimbabwe presently needs at least two more aircraft, of which one will be dedicated to service the domestic market while the other will be dedicated to regional destinations. 

Mpofu said Air Zimbabwe will deploy the two Airbus A-320s set to be re-delivered shortly from the South Africa, to service flights on key regional routes which include Nairobi in Kenya, Lilongwe in Malawi and Kinshasa in the Democratic Republic of Congo (DRC). “We will soon be adding the two Airbus A-320s to the fleet. They can accommodate the routes that we have not been able to service as a result of the limitations on our fleet. The old fleet will also be brought in.