Air Botswana eyes lift-off from financial doldrums
Pauline Dikuelo | Monday October 2, 2023 06:00
The national airliner has experienced losses since 2008 due to an ageing fleet, high maintenance costs, equipment failure, route redundancy and pressures from competition.
Air Botswana acting CEO, Masego Mookodi, recently told BusinessWeek that the company would be implementing a strategy that will reduce the national airline’s reliance on government subventions.
She said even though Air Botswana is still struggling, it is close to being sustainable.
“Air Botswana has not yet recovered from the impact of COVID-19,” she said. “We still have not reached the profitability levels that we had before the pandemic.
“However we are very close to sustaining ourselves as a business. “We acknowledge the support and systems we have been getting from government, but they have made it clear that we must learn to be self-sustaining and we are working very close to doing that.”
Earlier this year government injected P168 million into the national airline. Initially, the Ministry of Finance had planned to give Air Botswana P133.6 million but this was later increased by P35 million to adequately cater for the refurbishment of their fleet.
“As a business, we have come up with a turnaround strategy which we will be implementing within the next few weeks and this is to drive our ability to be able to sustain ourselves as a business,” she said.
While the strategy remains under wraps, BusinessWeek has learnt that part of the plan includes more aggressively pushing Air Botswana’s cargo business. The national airline believes this particular area has the potential to significantly grow its revenue.
“We have realised that the only airlines that are doing well and have survived during COVID-19, are those that run the cargo business well,” Mookodi said. “We have already started negotiations with several industries to start utilising our air cargo services for efficiency. “We are proud to announce that some have come forth and we have already signed an agreement with the Botswana Chamber of Mines.”
Another part of the strategy involves the long-awaited separation of Air Botswana’s ground handling operations into a standalone company. The separation would trim Air Botswana's labour costs and allow the airline to focus on its core operations, while still deriving some income from the ground-handling subsidiary.
Meanwhile, Mookodi said their plans to separate from its ground handling operations are still underway but have not yet secured the necessary equipment needed.
“The handing off of the ground operations is one of the key projects,” the acting CEO said. “However we have not secured the equipment that is needed for the ground handling. “It is important that our stations also have the necessary equipment.”