RwandAir joins the fray

Rwanda’s national carrier RwandAir has come from humble beginnings but it has quite serious ambitions to compete among Africa’s top airlines.

One of the newer airlines on the continent and currently overshadowed by big hitters like Kenya Airways and Ethiopian Airlines, the company is not intimidated by the competition, says RwandAir’s CEO John Mirenge.

“Africa is still the most underserved continent that there is today. My belief is that there is a piece for all of us,” Mirenge told African Business from his office in Kigali International Airport, which overlooks the runway where he watches RwandAir planes take off.

“More than 80% of the traffic which goes out of the continent is carried by non-African airlines. That tells you we could all do more to play our part, and there is still room for all of us to grow.”

RwandAir was set up in 2002 but it wasn’t until 2009 that the Rwandan government decided to reposition it as an airline with ambitious goals, and to pump a lot of money into it.

“We are a young company, still in an investment phase,” he says. “Our capital outlay is still too heavy to be making a profit. All our routes are new and it takes four years before they start breaking even.

“We are still at that level where we are putting down the foundation bricks. But the medium-term view is that we hope to be breaking even or profitable in another five years.”

RwandAir has a total fleet of seven aircraft, serving 16 destinations. It owns five planes and leases two. The company bought two Bombardier CRJ-900s in 2012, and received a Bombardier Q400 in March this year. Fifteen of the company’s destinations are within Africa and they also fly to Dubai.

The company served around half a million passengers in 2013, and that is expected to grow to 650,000 this year. It hopes to hit the one million mark in the next three years, and Mirenge says the goal is realistic.

“Since 2010 when we started this new RwandAir, all of our passenger number targets have been attained and even surpassed, so we feel confident we will hit our million mark when we think we will.”

 Around 40% of the company’s current passengers are transfer passengers, not starting or finishing their trips in Rwanda. “A lot of our passengers are travelling between West and Central Africa, and East and Southern Africa, and are using Rwanda as a transfer stop,” Mirenge says. “Many of our passengers are also travelling to or from Dubai. It’s a very popular destination.

In fact we are looking at adding our first wide-bodied plane by 2016, which is urgently required because our Dubai route is so overbooked. Our baggage and cargo capacity is completely booked. We need very urgently to get a wide-body so we can take care of that demand.”

Many of RwandAir’s passengers are Africans buying goods in Dubai, who need the space to bring their purchases back to Africa. These passengers are also interested in travelling to India and China to shop.

“We are looking at opening a route to India, perhaps somewhere like Bombay, by 2016/17, and somewhere in China before 2017. This is aligned with the kind of clientele that we have, which is predominantly African, and their movements, which are driven largely by trade,” Mirenge says. “There is now a very big wave of movement towards India and China from Africa, and we want to be a part of helping people to get there.”