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High jet fuel costs in Malawi is a serious threat for the sustenance of air transport operations, representatives of the newly launched Malawian Airlines have disclosed.
The Malawian Airline company was officially launched by President Joyce Banda in Lilongwe who welcomed the development as positive move towards economic development.
Speaking to journalists in Lilongwe Malawian Airline Board Chairperson George Patrige said Malawi has the highest jet fuel cost compared to the global market which he said is an imminent threat to their business.
Patridge who is Chief Executive of National National Bank of Malawi said about 35% to 40% of air transport operational costs is consumed by fuel hence the higher the jet the risk it becomes to remain in business over time.
Patridge said: “Jet fuel prices are the highest in the world, if you look at the matrix at every airport in the world, they are around three to four dollars per gallon, here in Malawi they are around six dollars forty cents to a gallon, that means in some cases they are twice as much as in other airports.
“In airline business for round 35 to 45 percent of your costs is fuel and you can imagine the burden that is placed on us, at the money we are looking at the reason why jet fuel is more expensive in Malawi than anywhere else in the world, in actual fact if you can look at the International Air Transport Association (IATA) chat thus the most expensive.”
Patridge said due to exorbitant jet fuel in Malawi, most of the foreign airlines do not uplift their fuel in the country but they opt to load their fuel elsewhere and they go with the same on the return journey.
“That is not how we should be operating, we just have to find out bottom line as to why we are so expensive in Malawi and when we find out the reasons within the supply chain, then we should be able to sort out that problem,” said Patridge.
The Malawian Airline Board Chairperson did not hide his concerns that the sustainability of their business will be limited if the trend continues without being sorted out by the government and stakeholders involved.
“The issue is that you have to cut costs wherever you can but there is a limit on how much you can cut costs, and i think the sustainability of the airline if we don’t check on the fuel issue it will be questionable, but am sure we are working hard with all the stakeholders,” he said.
He then added that one of the contributing factors to the problem is that there is no critical mass and that once the volumes become available and with the Malawian Airline added on the list, the prices may come down.
Another challenge he said is major competition the company faces among other existing airlines operating in the country, but he clarified that the company believes that it will stand out to be the best among other players.
e said the company boast of latest mode of airplanes that have less on board noise and with inside facilities designed for the customer convenience a development he says will help their customers and prospective ones to like their services.
