Uganda Airlines Eyes 2030 Break-Even with Strategic Overhaul

Uganda Airlines could achieve financial stability by 2030, provided it receives the necessary governmental backing to bolster its operations, according to its recently appointed Chief Executive Officer, Girma Wake.

Wake, formerly of Ethiopian Airlines, detailed a turnaround strategy emphasizing the development of technical and human resource capabilities, expansion of cargo services, and investment in crucial areas like catering and aircraft maintenance. A key objective is to establish Entebbe as a vital transit hub connecting Africa with international destinations.

“An airline should be able to stand on its own. It cannot continue to beg money from government,” Wake stated, highlighting the need to move away from a dependency mindset. He acknowledged the need for initial financial support for development but stressed that this must have a defined end.

Despite revenue growth and route expansion, Uganda Airlines has continued to incur significant losses. Recent reports indicated a net loss of Shs 237.9 billion in the 2023/24 financial year, even as passenger and cargo revenues saw substantial increases.

The airline recently placed its first direct order for Boeing aircraft, including four 737-8s and four 787-9 Dreamliners, expected to modernize its fleet and support future market expansion.

Wake also addressed the immediate challenge of fleet recovery, noting that upon his arrival, half of the airline’s six aircraft were grounded due to maintenance issues. Efforts are underway to return these aircraft to service, with the carrier currently utilizing a wet-leased aircraft to maintain its flight schedule while repairs and maintenance are completed.

The strategy prioritizes regional expansion over immediate long-haul routes to build traffic more sustainably. Wake intends to leverage smaller aircraft for regional routes, feeding passengers into Entebbe for onward international travel, mirroring successful hub models like Emirates and Ethiopian Airlines.

Furthermore, the airline plans to enhance its own technical capacity, including the revival of Soroti Flying School, and develop in-house catering and cargo handling services. Wake believes these integrated services will not only improve efficiency but also unlock new revenue streams and support national development goals.

Source: The Observer (Uganda)