It has emerged that Kenya Airways (KQ) will seek to lay-off staff, reduce network and sale assets to remain a going concern.
According to an internal memo by the airline`s Chief Executive Officer Allan Kilavuka, the exercise will be complete in the third quarter of 2020. He added that “Our short- and medium-term projections indicate that we must inevitably reduce our operations before we begin to scale up again.”
KQ had been struggling long before the outbreak of the Coronavirus. The airline like South African Airways has been surviving on government bailouts after years of posting losses.
In 2019, KQ posted a loss in the region of US$ 125 million and things are set to get worse with the coronavirus induced restrictions. The International Air Transport Association (IATA) predicts that African carriers will lose U$6 billion in revenue in 2020.
At the onset of the pandemic, Kenya Airways Executives took a huge pay cut and further extended cut staff salaries. The airline’s request for a bailout fell on deaf ears as government opted for the airline to pursue the previously set plan to nationalize the struggling carrier.
Meanwhile the Dar Es Salaam Stock Exchange suspended trading of Kenya Airways Shares citing plans to nationalize the airline by the government.
During the lockdown period, KQ has been relatively active with both repatriation and cargo flights. A number of repatriation flights to London, New York and Johannesburg were performed. Kenya Airways deployed its Boeing 787 Dreamliners on cargo operations to help out with the growing demand for air freight.
Following the announcement of the structured reopening of the country’s airports by President Kenyatta, KQ will resume domestic operations from the 15th of July while international flights will resume on the 1st of August.
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