African airlines seeking ways to lower cost of fuel
AFRAA launches joint fuel purchasing project
(eTN) - Nine member airlines of the African Airline Association (AFRAA) in Nairobi will be joining hands under a project devised by AFRAA in an effort to seek lowering their fuel cost in the future. Kenya Airways will, jointly with Ethiopian Airlines, Precision Air, RwandAir, Air Malawi, Air Namibia, TAAG of Angola, LAM Mozambique, and Air Seychelles, begin a joint Jet A 1 purchase scheme, thought to be worth over US$1.5 billion per annum and rising.
AFRAA has over 30 members from across Africa, representing almost 85 percent of all traffic carried by African airlines, and more carriers are expected to join the initiative, which may save several percentage points on fuel cost for those participating in the scheme. AFRAA’s Secretary General Elijah Chingosho also used the opportunity to decry once again the high cost for African airlines of doing business on the continent through a range of regulatory and other charges and taxes levied on them, and called on African governments to do more to make their own airlines more competitive.
It is also understood from a source in Nairobi that individual fuel hedging contracts the various airlines are committed to, will not be affected, and as such, will depend on each airline’s own assessment on which way the fuel cost is likely to go over the year ahead.
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