Kenya Airways

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Kenya Airways
IATA
ICAO
Callsign
KQ[1] KQA[1] KENYA
Founded22 January 1977; 47 years ago (1977-01-22)
Commenced operations4 February 1977; 47 years ago (1977-02-04)
chairman)
  • Allan Kilavuka (managing director and CEO)
    • RevenueIncrease KSh 178,496 million (US$1.34 billion) (FY 2023)[4]
    Operating incomeIncrease KSh 10,531 million (US$80.38 million) (FY 2023)[4]
    ProfitIncrease KSh –22,696 million (US$–175 million) (FY 2023)[4]
    Total assetsIncrease KSh 176,613 million (FY 2023)[4]
    Employees3,825 (2022)
    Websitewww.kenya-airways.com/ke/

    Kenya Airways Ltd., more commonly known as Kenya Airways, is the flag carrier airline of Kenya.[5] The company was founded in 1977, after the dissolution of East African Airways. Its head office is located in Embakasi, Nairobi,[6] with its hub at Jomo Kenyatta International Airport.[7]

    The airline was owned by the

    Nairobi Stock Exchange, the Dar es Salaam Stock Exchange, and the Uganda Securities Exchange.[8][9][10]

    The airline became a member of SkyTeam in June 2010, and is also a member of the African Airlines Association since 1977.[11][12]

    History

    Early years

    Kenya Airways was established by the

    Northwest Orient.[19] The following year, the company formed a charter subsidiary named Kenya Flamingo Airlines, which leased aircraft from the parent airline in order to operate international passenger and cargo services.[20] Aer Lingus provided the company with technical and management support in the early years.[21]

    1980s–1990s: Expansion and privatisation

    A Kenya Airways Fokker F27-200 at Moi International Airport in 1982.

    In July 1980, the airline had 2100 employees and a fleet of three

    Boeing 757-200 was received in January 1990, whereas a third Fokker 50 was acquired in October the same year. By late 1991, two Boeing 737-200s had been leased from Guinness Peat Aviation.[30]

    Fiumicino Airport in 1999. With registration 5Y-BFT, this particular aircraft entered the fleet in November 1989.[30]

    In 1986, Sessional Paper Number 1 was published by the Government of Kenya, outlining the country's need for economic development and growth. The document stressed the government opinion that the airline would be better off privately owned, thus resulting in the first privatisation attempt. The government named

    managing director of the company.[30] Davies had been previously hired to carry out a study of viability on privatisation,[30] working for British Airways' Speedwing consulting arm.[31] Swissair was the first company to provide Kenya Airways with privatisation advice.[30] In the fiscal year 1993 to 1994, the airline produced its first profit since the start of commercialisation.[32] In 1994, the International Finance Corporation was appointed to provide assistance in the privatisation process, which effectively began in 1995.[33] A large aviation industry partner was sought to acquire 40% of the shares, with another 40% reserved for private investors and the government keeping the remaining stake. The government would absorb almost US$90 million in debts and would convert another US$31 million it provided in loans into equity; after reorganisation, the company would have a debt of approximately US$78 million.[30] British Airways, KLM, Lufthansa and South African Airways were among the airlines expressing interest in taking a stake in Kenya Airways.[32][33][34]

    KLM was awarded the privatisation of the company, which restructured its debts and made a master corporation agreement with KLM, which bought 26% of the shares, becoming the largest single shareholder since then.

    Boeing 737-300s were ordered in July 1996.[38]

    2000s–2010s

    In January 2000, the airline experienced its first fatal accident when an Airbus A310 that had been bought new in 1986

    Boeing 787-8s were ordered; the first two examples would be delivered in 2010 and the rest in 2011.[42] The original Boeing 787 order was amended nine months later to include three more aircraft of the type.[43] The first Embraer 190 joined the fleet in December 2010.[44]

    A Kenya Airways Boeing 767 in 2011.

    In June 2012 the company announced the issuance of rights worth

    787s the carrier has on order.[51]

    Operational results for fiscal years 2015 and 2016 showed substantial losses.[52] The rapid expansion of the fleet and routes (dubbed "Project Mawingu") was cited as the primary cause of the downturn. Fuel-price hedging and the 1996 agreement with KLM, considered intrusive in the running of the flag carrier, took secondary blame.[53] Corrective measures were taken to improve the financial and operational position of the airline and avert insolvency. The route partnership with KLM was deemed profitable thus, kept. However, the parties agreed to amend some features of the deal that had a negative effect on KQ -

    B737-700 were sold and five newer, leased airliners were sub-leased to improve cash flow.[54] Efforts to financially re-position the carrier were successful at the end of 2017. In a complex deal, stakeholders agreed to convert close to half a billion US dollars in loans to equity, changing the ownership structure. The government of Kenya, the biggest lender, saw its holdings rise from 29.8% to 48.9% while that of KLM was diluted from 26.7% down to 7.8%. A consortium of local banks, through a special-purpose vehicle called: "KQ Lenders Company 2017 Ltd.", ended up with 38.1%. The latter entity is obligated with a loan from the above local banks in the amount of US$225 million; this amount, in turn, is guaranteed by the government. The airline's employees, through a shareholding scheme, and others own the remaining 5.2%.[55] The Government of Kenya issued a guarantee for a further US$525 million debt owed to Import-Export Bank of the United States, financier of the newer Boeing
    planes of its fleet. In a bid to recover their exposure, syndicated leaseholders and banks unsuccessfully fought these measures to restructure the carrier's ownership.[56]

    An outline of a plan to restore profitability was disclosed in a March 2018 interview given by the CEO and the chairman of the company. The turnaround operation will include route expansion, pursuing the high-end segment of the market and, on partnerships and joint ventures with other airlines.[57] The carrier plans to add up to twenty new destinations in Africa, Europe and Asia in the next five years. Five sub-leased aircraft are to re-join the fleet by the end of 2019 to facilitate this move.[58][57] Preparations are underway to roll out an economy-plus class to target the business and high-end leisure travelers. Direct flights to luxury-tourism destinations in the Indian Ocean are also planned.[59] Talks are underway with South African Airways regarding route-sharing and aircraft-maintenance collaboration; this is the other focus of the turnaround scheme.[58] In December 2018 Kenya Airways revealed plans to start flights between Nairobi and Windhoek, Namibia.[60]

    2020s

    The airline announced plans to undergo a $1 billion restructuring in 2021 to help it recover from the COVID-19 pandemic.[61] Upon announcing major losses in 2022, the carrier announced plans to cut ties with the Kenyan government by the end of 2023.[62]

    Corporate affairs

    Subsidiaries and associates

    Low-cost carrier Jambojet, created in 2013,[63] and African Cargo Handling Limited are both wholly owned subsidiaries of Kenya Airways.

    Partly owned companies include Kenya Airfreight Handling Limited, dedicated to the cargo handling of perishable goods (51%-owned)[64] and Tanzanian carrier Precision Air (41.23%-owned).[65]

    Business trends

    The key trends for the Kenya Airways group over recent years are shown below (to 31 March until 2017; periods ending 31 December thereafter):

    2010 2011 2012 2013 2014 2015 2016 2017
    (Mar)         		2017
    (Dec)         		2018 2019 2020 2021
    Turnover (KSh. millions/=) 70,743 85,836 107,897 98,860 106,009 110,161 116,158 106,277 80,799 114,185 128,317 52,805 70,221
    Profit before tax (EBT) (KSh. millions/=) 2,671 5,002 2,146 −10,826 −4,861 −29,712 −26,099 -10,202 -6,306 -7,588 -12,975 -36,573 -16,028
    Net profit (KSh. millions/=) −29,704 -9,956 -6,418 -7,558 -12,985 -36,219 -15,878
    Number of employees 4,133 4,355 4,834 4,006 3,989 4,002 3,870 3,582 3,548 3,905 3,816 3,652 3,544
    Number of passengers (millions) 2.9 3.1 3.6 3.7 3.7 4.2 4.2 4.5 3.4 4.8 4.4 1.8 2.2
    Passenger load factor (%) 66.5 69.2 71.7 68.7 65.6 63.6 68.3 72.3 76.2 77.6 65.3 60.8
    Cargo carried (000s tonnes) 68 49
    Number of aircraft (at year end) 27 31 34 43 47 52 47 46 47 45 36 42 35
    Notes/sources [66] [67] [67] [65][68] [69] [70][71] [72] [73] 9 months
    [74]     		[74] [75][76]
    [77]     		[a] [75]
    [76][78]     		[79]
    1. ^ 2020: Activities and income in fiscal 2020 were severely reduced by the impact of the coronavirus pandemic

    Key people

    As of October 2016, Michael Joseph is the airline's

    Chief Executive Officer (CEO) of Safaricom, the leading telecom operator in Kenya.[80]

    As of August 2023[update], Allan Kilavuka held both the Group Managing Director and CEO position.

    managing director and CEO on 1 June 2017.[83] Kilavuka was later confirmed in the substantive role.[84]

    Destinations

    Main article: List of Kenya Airways destinations

    Kenya Airways serves 44 destinations with 61 different routes, as of August 2023.[81]

    Alliances

    KLM sponsored Kenya Airways' SkyTeam candidacy process in mid-2005.[85] In September 2007, Kenya Airways became one of the first official SkyTeam Associate Airline[86][87] and achieved full membership in June 2010.[88][89] The alliance provides Kenya Airways' passengers with access to the member airlines' worldwide network and passenger facilities.[90][91]

    Codeshare agreements

    Kenya Airways has codeshare agreements with the following airlines:[92]

    Fleet

    Current fleet

    Boeing 737-800
    Boeing 787-8
    Embraer 170
    in 2007.
    Douglas DC-8-70
    in 1990
    Boeing 737-700
    wearing an older livery.

    As of December 2023, the Kenya Airways fleet consists of the following aircraft:[104]

    Kenya Airways fleet
    Aircraft In service Orders Passengers Notes
    C Y Total
    Boeing 737-800
    		 8 — 16 129 145
    Boeing 787-8
    		 9 — 30 204 234 [105]
    Embraer 190
    		 15 — 12 84 96 [106]
    Kenya Airways cargo fleet
    Boeing 737-300SF 2[107] — Cargo
    Boeing 737-800SF 1[108] 1[108] Cargo
    Total 35 1

    Recent developments and future plans

    The first of four converted Boeing 737-300s was delivered to the company in April 2013; Kenya Airways planned to fly this aircraft on African routes served by the Embraer 190s, in order to boost cargo capacity.[109] The company took delivery of its first Boeing 777-300ER in October 2013.[110][111]

    Kenya Airways had nine Boeing 787 Dreamliners on order as of April 2011, although the company considered cancelling the order after systematic delays with the delivery dates.[43][112] The handover of the first Boeing 787 took place on 4 April 2014.[113][114] Two days later, Nairobi–Paris became the first route to be served by the Boeing 787.[115]

    Kenya Airways phased out its Boeing 777s in May 2015 after the airline made losses and incurred debts in the previous financial year.[116][117] The Boeing 777-300ER fleet was leased to Turkish Airlines in May 2016.[118]

    In 2022, the airline announced a plan to downsize its fleet.[119] In 2023, the airline announced plans to retire all non-Boeing aircraft and become an all-Boeing airline.[120]

    On the 20th December 2023, Kenya Airways announced that they had secured an agreement with HiFly Malta for an additional aircraft to enhance operational capacity and flexibility for the peak travel season, being delivered on the 20th December, and completing its first flight for the airline a day later, operating KQ310,[121] from Nairobi to Dubai.

    The airline took delivery of its first

    Boeing 737-800SF in November 2023; the aircraft was deployed on revenue service in February 2024.[107][108]

    Historical fleet

    The company has previously operated the following aircraft:[122]

    Livery

    In 2005, Kenya Airways changed its

    IATA airline code
    .

    Services

    Frequent flyer programmes

    Former Kenya Airways'

    Flying Blue in 2005, following the fusion of both companies. Gold Elite and Platinum Elite members of the Flying Blue programme are offered the JV Lounge.[128] This service is provided to Kenya Airways passengers, and to passengers flying with its partner airlines as well.[128] Simba Lounge is a service provided to Kenya Airways Business passengers only.[128] Both lounges are located at Jomo Kenyatta International Airport.[128]

    In-flight entertainment

    Different in-flight entertainment is available depending upon the aircraft and the class travelled. The airline's in-flight magazine is called Msafiri, and is distributed among the passengers in all aircraft, irrespective of the class.[129]

    • Boeing 787-8

    Premier World

    NVOD is offered in Economy class.[130]

    • Boeing 737-700/800

    Overhead screens in both classes, plus eight channels of audio offered.[131]

    • Embraer 190

    Individual in-seat touchscreens.[132]

    Accidents and incidents

    5Y-BBK, a Kenya Airways Boeing 707-320B in 1986, was damaged beyond economical repair on 11 July 1989, in an accident at Bole International Airport.[133]

    Kenya Airways has had two fatal accidents and two

    hull-loss accidents.[134]

    See also

    Notes

    1. Douglas DC-9-32s previously operated by EAA.[18]
    2. ^ It is likely that Flight International records had not been updated at the time of publish. Another source informed that the number of A310s in fleet immediately after the crash was three.[40]

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    Bibliography

    • Guttery, Ben R. (1998). Encyclopedia of African Airlines. Jefferson, NC: McFarland & Company.
      ISBN 978-0-7864-0495-7
      .

    External links

    Media related to Kenya Airways at Wikimedia Commons

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