D R Congo creates an airline with Air France-KLM: Congo Airways

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D R Congo creates an airline with Air France-KLM: Congo Airways

Post by sn26567 » 16 Aug 2014, 18:56

The government of the D R Congo in Kinshasa on Friday signed a partnership agreement with Air France-KLM to create this year a new Congolese national airline called Congo Airways.

"We will ask our partners Air France-KLM to work under pressure in order that the Congolese national carrier is already launched before the end of 2014," said Prime Minister Augustin Matata Ponyo during Friday's signing ceremony of the partnership agreement between Air France-KLM and the Congolese government.

The Ambassador of France in the Democratic Republic of Congo, Luc Hallade, said the signing of the partnership agreement between the DRC and Air France is the result of exchanges between President Joseph Kabila and his French counterpart François Hollande in Paris in December 2013.

Future airline, which would have a fleet of ten aircraft will replace the Congolese airline "LAC", which went bankrupt ten years ago.

The Congolese government had consulted several global carriers about the creation of a new national airline, at a time when the country seeks to emerge from the blacklist drawn up by the European Union.

"The Congolese government experts met with representatives of Brussels Airlines, Turkish Airlines, Kenya Airways, Ethiopian Airlines, South Africa Airways," revealed an advisor to the Prime Minister.

The aviation sector in the DRC is characterized by a high frequency of plane crashes, the most dramatic are the Tupolev plane crash on a market on 6 January 1996, with more than 2,000 dead, the crash of a Hewa Bora Boeing at the airport of Kisangani on 8 July 2011 (more than 90 dead), the crash of a Hewa Bora DC-8 on the Birere market in Goma (over 120 dead), the Air Kasai plane crash at Goma airport (10 dead), the crash of an Filair airliner in Bandundu following the release on a crocodile carried by a passenger, not to mention other incidents recorded in the Congolese airspace.

At the national conference on air transport organized in Kinshasa on 10 April 2013, the participants recognized the broader failure trends in the airline industry in the Democratic Republic of Congo.

These include failures, outdated equipment, lack of maintenance of aircraft, most of which date from the 50s, 60s and 70s, the lack of training of young pilots and co-pilots and cabin personnel, lack of airport equipment such as anti-fire vehicles at several airports, deteriorating runways, the overload.

Source: french.china.org.cn (!), hence don't be afraid for some inaccuracies
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Lenoest
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Re: D R Congo will create an airline with Air France-KLM

Post by Lenoest » 16 Aug 2014, 19:42

No good news for Korongo I guess.

Inquirer
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Re: D R Congo will create an airline with Air France-KLM

Post by Inquirer » 16 Aug 2014, 19:51

I was just about to start a topic about this, when I saw you beat me to it, André. :)

Here's a link to an article about it on De Tijd.
http://www.tijd.be/nieuws/ondernemingen ... .art?ckc=1

It may be a missed opportunity for Korongo in a way, but it can also be seen as positive news to them as it may accelerate the end of the EU ban on all airlines from Congo, which would be very good news for them of course.

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Re: D R Congo will create an airline with Air France-KLM

Post by airazurxtror » 16 Aug 2014, 20:23

No good news for Brussels Airlines either, as they will probably fly Kinshasa - Brussels and/or Paris ...
But good news for the consumer, as the fares will hopefully be reduced by the competition between carriers.
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Re: D R Congo will create an airline with Air France-KLM

Post by Flanker2 » 16 Aug 2014, 20:25

This is a death sentence for Korongo.
SN/LH didn't invest in Korongo due to lack of funds and missed their opportunity. They also missed an opportunity to create a Congolese feeder by operating out of FBM iso FIH, a strategic mistake IMO.
This also means that SN will come under pressure on their FIH ops as well, their most important African market.

All I can say is shame, shame, shame.

b720
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Re: D R Congo will create an airline with Air France-KLM

Post by b720 » 16 Aug 2014, 20:47

Indeed, a lost opportunity for SN. It is definitely bad news for Korongo and SN.

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Re: D R Congo will create an airline with Air France-KLM

Post by RoMax » 16 Aug 2014, 23:33

Flanker2 wrote:They also missed an opportunity to create a Congolese feeder by operating out of FBM iso FIH, a strategic mistake IMO.
SN generates quite some additional traffic on their BRU-FIH flights with traffic flying from/to Lubumbashi and Mbuji-Mayi, both connected with FIH by Korongo. No need for SN to feed direct (read: one-stop) from JNB, without non-stop flights and lacking market penetration by SN itself in South Africa, their is no market case for such connections on a large scale.
Flanker2 wrote: SN/LH didn't invest in Korongo due to lack of funds and missed their opportunity.
Mind that it's not that easy for SN to invest enough money in Korongo without sufficient support from Congolese investors. Or they would have to work with risky loans, having the risk they lose all that money to a company in which they do not control a +50% share. Actually raising the company capital without the Congolese investors doing the same, would push their share beyond the 50% with Korongo losing the status of a Congolese company.

Currently SN is losing money on Korongo, while at the same time generating new revenue on their FIH route. It's basicly a zero-sum game at this moment.

But indeed bad news that a new company partly owned (and fully supported) by the government and with AF-KL as the private partner, is launching operations in Congo in the very near future... AF-KL probably had more to offer (either money, their 'global status', a huge African network, etc.) than SN, TK, ET and SA.

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Re: D R Congo will create an airline with Air France-KLM

Post by cnc » 17 Aug 2014, 11:02

i'll have to see it to believe it

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Re: D R Congo will create an airline with Air France-KLM

Post by Inquirer » 17 Aug 2014, 11:11

FWIW, additional reporting suggests it's going to be a purely domestic airline, so no long haul plans.

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Re: D R Congo will create an airline with Air France-KLM

Post by Lysexpat » 17 Aug 2014, 13:26

Inquirer wrote:FWIW, additional reporting suggests it's going to be a purely domestic airline, so no long haul plans.
The article you quoted says: "mainly domnestic" not "purely"
IF this goes true you will certainely see an increase of the KLM-AF presence in FIH.

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Re: D R Congo will create an airline with Air France-KLM

Post by kilobravo243 » 18 Aug 2014, 13:57

The company will first fly domestic, then regional before going international, but that will most likely not happen anytime soon. On the other end, Korongo is about to open Kisangani route as they are currently hiring. My understanding was that Forrest Group was willing to put more money but SN was not that ready. Has that changed, will see in the next weeks/months.

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Re: D R Congo will create an airline with Air France-KLM

Post by b720 » 18 Aug 2014, 14:34

Excuse my ignorance, but was there a reason why Korongo was not based at FIH? I still can not understand why SN's feeder's hub (in central and southern Africa) is at an airport SN does not even serve!

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Re: D R Congo will create an airline with Air France-KLM

Post by White Light » 18 Aug 2014, 19:21

For those who can read French :

http://www.air-journal.fr/2014-08-18-rd ... 12670.html

Short summary :
- 100 % Congolese capital and shareholders to create Congo Airways (so, it seems AF/KL are not investing money in it)
- Several airlines were consulted for this project, including Brussels Airlines, but AF/KL came out as the Congolose authorities' favorite
- Air France Consulting will take care of the launch of the airline and is urged to do it by the end of 2014
- Congo Airways will have about ten aircraft
b720 wrote:was there a reason why Korongo was not based at FIH?
Possible answer :
kilobravo243 wrote:Forrest Group
Missed opportunity for Brussels Airlines :
kilobravo243 wrote:My understanding was that Forrest Group was willing to put more money but SN was not that ready.
Is Brussels Airlines ever ready ? No, they always miss the boat (or plane to put it more accurately)

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Re: D R Congo will create an airline with Air France-KLM

Post by Flanker2 » 18 Aug 2014, 20:51

b720 wrote:Excuse my ignorance, but was there a reason why Korongo was not based at FIH? I still can not understand why SN's feeder's hub (in central and southern Africa) is at an airport SN does not even serve!
Seeing how the top ran this project (not Allard, who IMO did a good job and must be very frustrated to not get funds), the question is whether they themselves knew why they based at FBM. :lol:

Even a dual hub would have made sense to some degree if only to satisfy Forrest, but even though FBM is an economical lifeline for Southern DRC, FIH is still by far the main economical and political center of the DRC.
I though that there could have been a plan behind the FBM base, but as is apparent, they didn't have a plan.

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Re: D R Congo will create an airline with Air France-KLM

Post by kilobravo243 » 18 Aug 2014, 21:12

I dont think the fact Korongo is based at FBN is the issue. From there they can still fly thrughout the entire country or they could have open a route to Zambia or another african country. Korongo real problems are lack of funding, impacting their expansion and maybe vision. The company is only flying to 3 domestic routes at this point, as they consider them to be the only airports with the minimum required safety measures.

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Re: D R Congo will create an airline with Air France-KLM

Post by RoMax » 18 Aug 2014, 23:12

Don't forget Forrest is the second largest investor...their presence in and around Lubumbashi must have been a key element in the decision to base Korongo in FBM. In addition, Korongo is about more than being a feeder for SN, but about building a regional carrier which in its own right can be a profitable business (though not at the current size of 1 aircraft, its overhead costs are way too high at this moment to book net profits). A third element (directly related to my previous point), in FBM there is more unexploited business compared to FIH on the domestic/regional market.

And as I explained in my previous post and also said by kilobravo243, Korongo's base in FBM is not the issue. Korongo currently serves three airports in the DRC, all of which are non-stop connected with FIH (including 3 'direct-transfer' possibilities from FBM to BRU per week). JNB in this case is no point, that's a perfect example of a route which is intended to exploit the local business opportunities and not intended to feed SN. If try to sell JNB-Europe via DRC, you do not have a solid market case, not even when it's BRU-FIH (which is often not non-stop either), FIH-JNB. There is way too much non-stop competition on well known 'global carriers'.

The problem of Korongo is a combination of many aspects: lack of infrastructure which is upon European standards (or at least, sufficient to allow operations by a EU registred aircraft), the mentality of "not my fault, it's the other one" with even investors blaming the other one of not investing enough or not fast enough (sorry to say it, but typically Africa), the government which is not really willing to give Korongo a free run on the domestic market, etc.

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Re: D R Congo will create an airline with Air France-KLM

Post by convair » 19 Aug 2014, 00:43

kilobravo243 wrote:...On the other end, Korongo is about to open Kisangani route as they are currently hiring...
Can you confirm that? In the past, they always mentioned Kolwezi.

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Re: D R Congo will create an airline with Air France-KLM

Post by OO-ITR » 19 Aug 2014, 09:56

convair wrote:
kilobravo243 wrote:...On the other end, Korongo is about to open Kisangani route as they are currently hiring...
Can you confirm that? In the past, they always mentioned Kolwezi.

https://www.facebook.com/flykorongo

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Re: D R Congo will create an airline with Air France-KLM

Post by b720 » 19 Aug 2014, 11:16

SN is fighting for survival at it's home in BRU, revamping the RDC domestic airline business is a bite more than it can chew.

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Re: D R Congo will create an airline with Air France-KLM

Post by euroflyer » 19 Aug 2014, 20:45

Before getting too excited about a missed opportunity here for SN, let's wait if this new airline will ever fly ... and if it does, for how long and how economically successful ...

If there is really no AF money to be spent and all the French will do is some consultancy work to help them with the management etc. - why should that be more successful than any of the past DRC airlines ... ? Is the government down there the best partner and the best in airline management? I have my (big) doubts ... (and I guess AF has a reason not to give any money of their own ...)

Wait and see!
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