The CEO of Ethiopian Airlines Tewolde Gebremariam has warned that Gulf carriers could eat us for their lunch unless there is a concerted effort by African airlines to get increase market share from the fast-growing continent.
Speaking at the Aviation Club in London, Gebremariam (pictued right) said “We have tremendous competition coming from the Gulf carriers. Dubai is only three and half hours away from Addis, Abu Dhabi and Doha the same. They have been doing very well and now Africa is also in their centre of strategy.
“We see the centre of gravity moving from Europe to the Middle East and especially the Gulf.”
He said that Europe’s failure to respond to the threat by the Gulf carriers had led to this change.
“Europe has been the oldest and most successful for hub and spoke operations with airports like Heathrow, Frankfurt, Amsterdam and Paris. For passengers travelling from south and north America to Europe, Africa and Middle East and Asia the only way was through Europe, but now that hub and spoke is moving to the Middle East and unfortunately and inadvertently European governments and politicians are helping them move the centre of gravity to the hubs in the Middle East by making it very difficult for airlines to operate in Europe.
“Taxation is one factor, airport congestion is another,” Gebremariam said. “As a result airlines are finding it very difficult to fly to Europe. Heathrow is one of the most congested airports. Ethiopian wants to fly to Heathrow twice a day, but we are only able to fly six flights a week. We can’t even get a daily service. A third runway at Heathrow has been discussed for years yet Dubai was able to build Dubai World Central Airport with six runways in short order.
“Frankfurt Airport has put a policeman in the ATC tower to ensure no flight leaves after 10 or 11 o’clock at night, emission trading is another problem for all of us. Labour unions are very difficult for European carriers and they also have to compete with the Gulf carriers and small African carriers like us also. The tax regime in the Gulf is different – no tax at all – but knowing this again, there is no remedy for small carriers in Africa and also Europe, so inadvertently Europe is helping the Middle East carriers.
Gebremariam said that the Gulf countries are treating aviation as a strategic national asset. “The contribution of aviation to social economic development is recognized and it is the pride of governments, but other governments and even in Africa are not recognizing this unfortunately. We are growing very fast but we have a serious challenge when considering that 80% of traffic between Africa and the rest of the world is controlled by non-African carriers – All of us – Kenya Airways, Ethiopian, South African, Egyptair, Air Morocco, TAG Angola, CAM Air, Rwandair, Arik Air and so on –put together – we only have 20% of the market. This is a big, big challenge if we don’t do something to at least maintain 50% of the market. Otherwise we are going to be swallowed and they are going to have us for their lunch.”