Ethiopian's bets on pan-African expansion
What is Ethiopian up to?
In the last decade it has emerged as one of (if not THE) key player in the African air travel market, making of Addis Abeba a regional hub of notable significance.
Interestingly, it seems that the Ethiopian flag carrier is outgrowing, not just its own home market, but also its hub-and-spoke model.
In a move that is reminiscent of Etihad’s now questioned growth-through-acquisition strategy, Ethiopian is spreading its wings all over Africa, investing in other airlines or helping local governments and investors get new startup airlines off the ground.
Let’s have a look:
Ethiopian Airlines has been rumored to be interested in a planned new Nigerian national airline (an interesting prospect, since, for some reason the Nigerian airline industry seems quite small in relation to the size and population of the country)
It has also invested in the creation of a new national airline in Zambia (where it will have 45% of the venture).
And this is in addition to the fact it has an affiliate in Togo, ASKY tgat, interestingly, was reported at some point to be considering flights to Newark and Sao Paulo from Lomé, in West Africa, using Boeing 737NG aircraft.
ASKY is also part of the joint venture that will launch Guinea Airlines, in the country of the same name (in fact, it is more of a re-launch, since flag carreir Air Guinée ceased operations 15 years ago).
In Mozambique, Ethiopian Airlines has registered to launch domestic flights under the brand Ethiopian Mozambique Airlines
Ethiopian also operates the small national airline of Malawi, Malawian Airlines.
This is not only an impressive amount of investments, but, amazingly, almost all of them have been concluded during the course of this year. Quite a frantic pace of growth.
What is less clear is whether Ethiopian is going to be able to make all this collection of assets work in some coordinated way or they will just remain like stand-alone operations, independent from each other and from the main Ethiopian Airlines brand.
If precedent is of any guide, it did not quite work for Etihad, despite the abundance of resources that the Gulf carrier had at its disposal. The Abu Dhabi airline is now divesting some of this assets, while others, such as Air Berlin, have gone bankrupt.
It looks like a hard task (not even Stelios, of Easyjet fame could crack it, its FastJet venture languishing, far from its original pan-African designs), but, in any case, if there is someone that knows how African aviation market works, that is Ethiopian, whose network embraces pretty much all the continent.