Kenya’s largest airline is betting on the country’s expanding middle class and recent economic growth to drive the success of its new low-cost subsidiary a decade after it was forced to shut down a similar venture. [hidepost=9][/hidepost]
Low-cost carrier Jambojet, a subsidiary of Kenya Airways, is set take to the skies on April 1, flying from Nairobi to three major towns in Kenya (Mombasa, Kisumu and Eldoret). The airline’s entry is likely to shake up the budget airline market given that it is offering one-way tickets for US$33.
A lot has changed in Kenya in the last 10 years since Kenya Airways was forced to abandon Flamingo Airlines. Today more people have access to the internet and can make online bookings, the middle class is growing, the private sector has expanded and smaller towns are becoming business hubs.
Jambojet CEO Willem Hondius told How we made it in Africa that Kenya Airways’s re-entry into the budget airline market was necessitated by demand. He says Jambojet will “attract a lot of new customers who were not flying before”.
Hondius cites the case of businesspeople who frequently travel to Kenya’s coastal city of Mombasa to transact business at the port. If they travel by bus they would spend two days on the road – Kenya recently instituted a night travel ban on all public transport vehicles.
“Now they can fly up and down in one day. They can grow their business by being there more frequently. Of course, the people who pay KSh.700 ($8) for the bus will not take the step towards flying because that [price] gap is too big. Their first aim is to move from the ugly bus to the nice luxury bus. The people travelling on luxury buses can start flying. There are also people who fly, but only once or twice a year and now they can fly much more frequently.”
Hondius was appointed project manager of Jambojet in 2012 while serving as general manager for East Africa for KLM Royal Dutch Airlines (a Kenyan Airways shareholder) and then as CEO last September.
To pave the way for Jambojet, Kenya Airways recently announced it would cancel some frequencies in Mombasa and Kisumu and withdraw all its flights to Eldoret. Hondius explains the move would ensure the two airlines don’t produce too many seats on the same route and avoid “competing with each other”.
“Together we offer more seats than Kenya Airways flying alone on those routes.”
Jambojet’s target is to fly 600,000 people in one year. The airline will fly five times a day to Mombasa, twice a day to Kisumu and 10 times a week to Eldoret.