Thursday, February 29, 2024

Kenya Airways vs Ethiopian Airlines: How KQ lost glory as ET soared

Kenya’s national carrier Kenya Airways was once the Pride of Africa. Those days are now long gone. Ethiopian Airlines is now the top and biggest airline in Africa.

As Kenya Airways returns billions of losses, Ethiopian Airlines has been turning tens of billions of profit. In the twelve months ended July 2022, Ethiopian Airlines made an astonishing Sh. 112.4 billion profit.

In the same period, Ethiopian Airlines saw its revenue rise by 79 per cent to hit USD 5 billion.

In contrast, Kenya Airways made a net loss of Sh. 9.9 billion in the first six months of its current financial year. This though was a reduction from the Sh. 11.5 billion loss it recorded the previous year.

These figures raise a fundamental question: how did these two renowned airlines take such different routes? One to mega profits and the other to mega losses?

Data analyst Elijah K. Samuel analyzed profit and passenger data from the two airlines over a 16-year period. These were his findings:

In 2006/07 financial year;

1). Kenya Airways (KQ) carried more passengers than the Ethiopian (ET) and by actually 25%. KQ carried 2.6M passengers while ET carried 2.1M Passengers

2). KQ was flying to 42 destinations in the year under review, while ET was flying to 49 destinations. Not significantly different

3). In the same year, KQ made a profit of 59.8 Million USD, which was nearly 4 times higher than the ET Profit of about 14.5 Million USD

4). The number of staff in the year was not significantly different for both airlines, although ET has a slightly higher number!

HOWEVER, 13 years later in 2019:

A). KQ was making massive loses while ET was swimming in colossal profits! In 2019, KQ made a loss of nearly 129.8 Million USD while ET made a profit of 130.0 Million USD (pre-tax)

B). In 2019, KQ was flying to 56 destinations, while ET was flying to 121 international destinations, nearly 2 times more than KQ

Ethiopian Airlines profit hits Sh. 112.4 billion in 12 months

C). By passenger, KQ carried 5.2 Million people in 2019 while ET did more than double by carrying approximately 12.1 Million Passengers

D). KQ’s staff in 2019 was 3,734 which was significantly lower than the 13,953 staff under the ET

NOW, in the 13 years span!

a). KQ’s number of passengers flown grew by 100% from 2.6M to 5.2M while ET’s passengers skyrocketed from 2.1M to 12.1M which is a 476% growth

b). KQ’s destinations expanded by 33% from 42 to 56; while ET’s destinations grew by 2.5 Times from 49 to 121 which is 147% growth

c). ET was able to grow its profit by nearly 9 times from 14.1 Million USD to 130 Million USD while KQ nose-dived and has been making loses for nearly 8 years consecutively

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