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Local airline business set for cut-throat competition

This follows the arrival in Dar es Salaam of a leased Boeing 737-500 plane from Aero Vista of Dubai last Saturday. The plane is expected to hit the skies on Friday and possibly cut fares as well. Passengers to Kigoma which enjoyed daily flights by ATCL’s DASH-8 plane which overshot the runway last month, have been forced to use road transport or fly by PrecissionAir, which charges over 500,000/- for a round trip via Mwanza.

“It’s too expensive to fly to Kigoma via Mwanza for many of us,” said Editha Karlo, a journalist based in the Lake Tanganyika side region. Ms Karlo said many travellers to Kigoma have been forced to either use road transport, which is slow but cheaper or use PrecisionAir services which are expensive.

Rukwa businessman, Mohammed Kassim said suspension of ATCL flights to Kigoma hiked his running costs. “There was no way that I could operate without flying regularly between Dar es Salaam and Kigoma,” said Mr Kassim, a road contractor in Kigoma and Rukwa regions. “Competition is always good and we saw it when ATCL started daily flights to Kigoma last year.

Round trip fares went down to 250,000/- for sometime before stabilising at 350,000/-,“ said Kassim hoping fares would fall significantly if ATCL brought in more aircraft. An aviation official with the Tanzania Civil Aviation Authority (TCAA) who preferred not to be mentioned because he is not the spokesman, said although operating costs had gone up due to a weak shilling, airlines were still charging very high fares which denies many people the option to fly.

“The problem is that we have no legal powers to check against airfares like the Energy and Water Utilities Regulatory Authority (Ewura) on fuel prices,” the TCAA official said. EWURA sets monthly fuel indicative prices that guide oil marketing companies to decide pump prices for consumers.

The only real competitor in the market is Fly540 which operates flights between Dar es Salaam Kilimanjaro, Mwanza, Mtwara and Zanzibar using CRJ-100 and Fokker 28 aircraft. Additionally, the company also operates flights to the Northern tour ist circuit of Arusha, Seronera, Manyara and Grumeti using Caravan Cessna aircraft. Fly540 charges modest fares, which Kigoma and Rukwa passengers unfortunately cannot enjoy as there are no flights to the two western most border regions of the country.

Last week, ATCL Acting Managing Director and CEO, Paul Chizi said shortly after the arrival of the 108-seater plane, “after we have stabilised in the local market, we will also look into a possibility of flying to Dubai in the next three months.” “Our loyal partners and supporters should expect high quality services they have missed for some time.

What we need is their support as the national flag carrier,” he said. He said the company will enter into joint venture with various international airliners in a bid to extend its wings. “We will do this very carefully to create a win-win situation. There is no point to enter into a contract just for the sake of it whereby ATCL will not benefit,” Mr Chizi said.

The new plane has already been inspected by a team of experts from the Tanzania Civil Aviation Authority (TCAA) in Cairo, Egypt where the aircraft was flown from Dubai and a certificate to fly in the country issued. The plane branded with ATCL corporate colours with its giraffe trademark on its tail touched down at 9:46 pm and was received by the company’s overjoyed workers and invited guests.

It is configured to carry 12 passengers in business and 96 passengers in the economy class. Mr Chizi added that the company’s mid-sized DASH-8 currently undergoing repairs at Terminal One will be ready in the next six weeks and will help boost the company’s service delivery.

AFTER the completion of 1.7bn/-worth of development projects ...

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Author: BUSINESS STANDARD Reporter

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