Government says the time for parastatals such as Air Zimbabwe to be perennially carrying begging bowls seeking funds from Treasury when they have idle assets, is over.
Deputy Minister of Transport and Infrastructural Development, Advocate Fortune Chasi told The Sunday Mail Business last week that it is unacceptable for parastatals to struggle for funds when they have grounded aircraft.
Adv Chasi said Air Zimbabwe should optimally use its assets and sustain its operations instead of seeking Government bail-out all the time.
“We are completely unhappy with a situation where the planes are grounded and they are not earning income. We don’t believe that Government must perpetually be putting in money into parastatals when they have assets they must sweat,” he said.
Currently, the ministry is engaging authorities at Air Zimbabwe to establish the extent of the challenges they are facing and proffering possible solutions. A source at Air Zimbabwe said management is waiting for direction from the ministry, but is keen to transform the national airline’s operations.
“We are in the skies. We have two aircraft plying the Harare-Bulawayo route, Harare-Johannesburg route, Harare-Victoria Falls route and the Harare-Dar es Salaam route. I think we are doing relatively well considering that employees are getting their salaries every month,” said the source.
Operational challenges at Air Zimbabwe, some of which are traceable to maladministration by previous managers, and legacy debts of up to US$330 million, have opened avenues for privately owned firms to grab the company’s market share. The “managed liberalisation” of the air transport sector, meant to enhance destination connectivity for the benefit of travellers, has increased competition for Air Zimbabwe.
As a result, the national airline has lost considerable market share to budget airline, fastjet.
fastjet is now plying the Harare-Victoria Falls, Harare-Bulawayo and Harare-Johannesburg routes. The three routes were cash cows for Air Zimbabwe but its inability to fully service them due to aircraft breakdowns, terrible on-time adherence and high costs, have tilted the balance of power in favour of fastjet.
fastjet’s strength is on costs and 90 percent on-time adherence.
Air Zimbabwe also used to be Southern Africa’s airline of choice for travellers going to England considering that it flew directly into the European country. But since its aircraft, a Boeing 767-200 commonly known as Victoria Falls was impounded by a United States firm, American General Supplies in December 2011 at Gatwick International Airport over a US$1,2 million debt, Air Zimbabwe stopped flights into England, fearing a repeat.
However, there is hope that the Harare-London route will be revived in the near future when Zimbabwe Airways, another national airline, gets an Air Operator’s Certificate (AOC) to start flying.
At the moment, the first of four Zimbabwe Airways’ Boeing 777s, which was commissioned in April this year, is in Malaysia where it was taken for routine maintenance.
Two of the Boeing 777s have since been paid for in full while the other two have a balance of US$29 million.
The total cost for the four planes is US$70 million.
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