Potential for African airline partnerships and consolidation as a lever for post Covid-19 growth
COVID-19 has clearly brought aviation to its knees; IATA estimates that airlines will lose USD 47.7 billion in 2021. This is especially true in Africa, which even before the pandemic was a region where it was difficult for airlines to achieve financial and operational efficiency. As airlines seek to manage the crisis and build a solid foundation for the future, partnerships and consolidation are quickly proving to be a powerful lever.
Airlines seeking partnerships can use a variety of options, from relatively simple interline and codeshare commercial agreements to deeper relationships such as joint ventures or equity partnerships that seek much higher levels of joint efficiency. In extreme cases, this could also lead to full merger or acquisition activity.
However, there is no one-size-fits-all solution. Each airline or airline group must evaluate for itself which approach is best suited within its applicable regulatory framework to achieve its individual goals in terms of market presence and financial efficiency.
Read the cover feature in the current issue of Africa’s Journal of aviation development "Aviation & Allied Business Journal" by our experts Arvind Chandrasekhar and Matthias Kern: