Africa's largest and most profitable airline, Ethiopian Airlines (IATA: ET), last week announced how it plans to weather out the storm brought about by the COVID-19 pandemic.
According to Ethiopian newspaper The Reporter, the airline's executive management led by Group CEO Tewolde Gebremariam laid out a business strategy meant to adjust to a loss of revenue between January and April 2020, amounting to US$550 million. Comparatively, the airline posted an operating revenue of 114.6 billion birr (US$3.9 billion) for the fiscal year 2018 - 2019, even amid the unfortunate events surrounding the infamous crash of ET302 in March 2019.
Mr. Gebremariam acknowledged the financial, operational, and commercial crisis brought about by the global pandemic, which has necessitated the carrier to ground around 90% of its fleet, for which it takes pride in being the youngest and most modern in Africa. In entirety, the fleet is composed of 12 cargo aircraft and 110 passenger aircraft. This is representative of the scaling down of operations that the carrier has had to do, as only 14 domestic flights are operated daily down from 350, and from 127 passenger and cargo destinations to a mere 19 during this period.
The Group CEO also added that as a result of the significantly reduced passenger flight demand, the airline had turned to its cargo, aircraft repair and maintenance, and hotel operations (at the newly opened Ethiopian Skylight Hotel) in a bid to keep generating revenue.
Mr. Gebremariam said: “We are now focusing on cargo operation. Cargo business is relatively doing well because medical supplies are urgently required all over the world. So cargo airplanes are busy. We are also trying to convert some of our passenger plane to cargo. At the moment we have a cabin loading but gradually we are going to remove passenger seats and use them for cargo to make sure that we survive global economic crisis and emerge stronger."
Notably, the airline was late-last month involved in the disbursement of medical equipment, courtesy of the Jack Ma Foundation, to member states of the African Union. The consignment, which totalled 1.1 million testing kits, 6 million masks, and 60,000 protective suits for healthcare workers were ferried from Guangzhou to the carrier's base in Addis Ababa, and later transported to 54 African states by the same airline. Ethiopian has also been involved in ferrying medical equipment from China to Europe, and has also undertaken repatriation flights across the globe.
The carrier also revealed that it has no plans to lay off employees, whether local or foreign., urging the public to ignore the fake news reported by some media agencies concerning an impending move to lay-off workers. However, it has placed half of its 17,000 employees on paid leave in a bid to abide by social distancing regulations at the workplace.
Additionally, and unlike other African carriers, Mr. Gebremariam expressed that the carrier would not be seeking government aid at this time, as the carrier is trying to mitigate the situation internally to the best of its ability, This move serves as a testament to the carrier's strong financial position, which it hopes to maintain throughout this period.