Kenya Airways pilots plan strike tomorrow, want airline boss out

What you need to know:

  • The move comes at a time when the airline is going through a financial crisis after posting a Sh30 billion loss in the last financial year and with industry calls for the review of the 1996 partnership between KLM and Kenya Airways, partly blamed for the crisis.
  • Some of the accusations levelled against the management are that they have entered into “questionable agreements with specific travel agencies”, which they claim has directly contributed to a significant drop in revenue.
  • The pilots said the reason Ethiopians were overtaking Kenya was because of the continued “haemorrhage, while select individuals bask in the light of tainted wealth”.

All Kenya Airways’ flights might be grounded on Thursday after the pilots’ trade union vowed to stage an industrial strike to force out the airline’s chief executive, Mr Mbuvi Ngunze.

The strike could also force a review of the 20-year-old deal between the airline and KLM, which gives the latter a larger say on the national carrier.

Mr Ngunze was appointed in December 2014 after the retirement of Mr Titus Naikuni who had been at the helm for 11 years.

But now, the pilots say the former chief operating officer turned chief executive cannot steer the loss-making airline back to profitability. “We are convinced that he lacks the aviation experience, capacity and moral authority to champion the airline’s recovery,” said Captain Paul Gichinga, the secretary-general of the Kenya Airline Pilots Association.

PROFIT WARNINGS

The move comes at a time when the airline is going through a financial crisis after posting a Sh30 billion loss in the last financial year and with industry calls for the review of the 1996 partnership between KLM and Kenya Airways, partly blamed for the crisis.

For instance, Kenya Airways’ head of networking in KLM is also blamed by employees and pilots for the decline of the airline into a regional carrier.

“Since his appointment, (he) has recommended the gradual decline of Kenya Airways into a regional carrier by recommending sale and lease of wide body capacity as well as the London slots. This has the benefit of making KLM stronger in the region as they already fly into Uganda, Rwanda and Tanzania,” said Mr Gichinga.

“Should Kenya Airways collapse today, the biggest beneficiary would be KLM.” The pilots appear to be buoyed by this month’s forced resignation of Air France-KLM chief executive, Mr Alexandre de Juniac, whose three-year term was punctuated by profit warnings and clashes with pilots’ union.

Kenya Airways has missed its own revenue targets by Sh50 billion and the management responded by outlining measures to contain the losses and steer the airline back to profits.

The pilots had threatened to go on strike in January but were requested by the board of directors to defer it.

“The intervening period should have provided the opportune time to address the deeper issues facing the airline. That has not been the case,” the union said. “We reaffirm our membership vote of no confidence in the Kenya Airways chief executive Mr Ngunze, and call for his immediate resignation.”

Some of the accusations levelled against the management are that they have entered into “questionable agreements with specific travel agencies”, which they claim has directly contributed to a significant drop in revenue.

“The cumulative revenue shortfall over the period that these agreements have been in force is estimated at Sh100 billion. Further, from 2011 to date, Kenya Airways revenues have stagnated while Ethiopian Airlines has overtaken and grown to almost Sh300 billion,” they said.

Ethiopian Airlines has for the last five years defied all odds and surprised aviation experts early this year by turning huge profits when other airlines in the continent were grounded.

The pilots said the reason Ethiopians were overtaking Kenya was because of the continued “haemorrhage, while select individuals bask in the light of tainted wealth”.

For instance, they said, Kenya Airways Cargo is supposed to give the airline a favourable revenue stream since Jomo Kenyatta International Airport is the cargo hub for the region.

“It is, however, interesting to note that a significant portion of Kenya Airways cargo business is routed to a local freighter company suspected to be owned by former Kenya Airways employees,” said the pilots.

While Kenya Airways is currently restructuring, the pilots were not convinced this would cure the airline’s troubles.

“It is absurd that a business can resort to selling its most valuable assets in order to recover to a profit position,” the pilots’ statement reads.