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Air Namibia projected to lose billions

Air Namibia projected to lose billions

Zorena Jantze

THE national airline, Air Namibia, is expected to lose in access of N$1 billion due to the ongoing deadly coronavirus pandemic.

 

This was revealed by Elia Erastus, acting managing director of Air Namibia, while sharing his view on the impact of COVID-19 on the Aviation industry.

 

“The Aviation industry has an economic ripple effect. Tourists become inbound travellers, and as such, public transport is affected as well. Anticipated growth for GDP for the national airline under normal operations were estimated between N$1.2 and N$1.5 billion, however, the airline is currently making almost close to zero revenue” he said.

 

Erastus added that the aviation industry is a highly regulated industry, and currently Air Namibia only operates charter flights for humanitarian, as well as essential services, which create little revenue.

 

Last week, the airline’s CEO announced that it would delay the payment of staff salaries by a week due to cashflow issues following the global pandemic.

 

“With COVID-19, this has caused a chain reaction throughout different sectors,” said Erastus stated.

 

Air Namibia lose billion deadly coronavirus pandemic
Picture for illustrative purposes only

 

When asked if there are plans to retrench staff members, Erastus stated that short term, employees will continue to enjoy job security as the Board is currently developing a business continuity plan.

 

“The Board has meetings on possible business ventures to ensure that we cater for our employees. The jobs of employees are secured, however, this is not a long time measure as a restart plan would take up to 36 months,” Erastus stated.

 

He further stated that neighbouring countries such as South Africa, which as the largest fleet, have also been badly affected by the pandemic.

 

This he said, however, creates market opportunity with SADC.

 

He added that their hope is that government relaxes lockdown measures so that the airline can operate local flights to revive revenue.

 

Commenting on the impact the pandemic has had on TranNamib, Johnny Smith, CEO of TransNamib, stated that business has gone down by 60%.

 

He added that currently, airlines are not flying, therefore there is no need for fuel, while restrictions have been put in place for some commodities and building materials.

 

“Currently, like most SOE’s, we are seeking a bailout from government and when we start moving into a new process, we will see how we improve business. We, however, remain positive as there are a lot of opportunities for rail transport, especially in the movement of large cargo,” said Smith.

 

Kavin Harry, interim Chief Executive Officer of the Namibian Ports Authority (Namport), noted that operations at the port have reduced by 50%.

 

The port currently has 11 ships at its operating decks, with a total of only three vessels allowed to operate per shift.

 

Harry added that due to these limitations, vessels are standing at sea for extended periods before they dock, resulting in slow turnover.

 

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