There has been some impressive growth in African aviation in recent years. Ethiopian Airlines and Kenya Airways have seen significant expansion, and Rwanda-based RwandAir could be on its way to something similar. It is still early days, but RwandAir has already seen some solid expansion, and with investment from Middle Eastern giant Qatar Airways, the sky could be the limit. It is certainly an airline to watch over the coming years.
RwandAir is the state-owned national airline of Rwanda. It followed on from the previous national airline, Air Rwanda. This airline was founded in 1975 and operated a limited network of passenger and cargo flights domestically and regionally. Domestic service ceased in 1994 during the Rwandan civil war.
International service was taken over by Uganda-based Alliance Air, with a 49% stake in the newly formed Alliance Express Rwanda. The Rwandan government maintained a majority holding.
Growing its fleet and operations
In its first few years, RwandAir operated just a small domestic and regional network, with leased and secondhand aircraft. According to fleet data obtained from AeroTransport Data Bank (ATDB.aero), its early aircraft included the DC-8s, 737-300, and the Dash 8.
The airline took on two leased 737-500s in 2010. And in August 2011, it took ownership of its first new aircraft, a 737-800. It added a second new 737-800 later the same year and two further leased new aircraft in 2016 and 2017. The airline is not alone in choosing the 737-800. It is the most sold of all 737 variants – popular with many airlines for its compromise on capacity and range.
- A330: one A330-200 and one A330-300
- Boeing 737: two 737-700 and four 737-800
- Bombardier CRJ: two CRJ900ER
- DHC Dash 8: two DHC-8-Q400
Two of the 737-800s are leased from Air Lease Corporation, the 737-700s are leased from AerCap and Dara Aviation. One of the Dash 8 aircraft is leased from Montrose Global. RwandAir owns all the other aircraft in the fleet.
RwandAir did have orders for two 737 MAX and two A330-900 aircraft. However, these orders were canceled in 2020 due to the slowdown in aviation and uncertainties over delivery dates.
Routes served have expanded along with the fleet. Today, it flies to 26 destinations in 40 countries. Regional routes include Accra, Cape Town, Harare, and Zanzibar. And long-haul, it has operated to Dubai, London, Brussels, Mumbai, and Guangzhou.
Adding China to its route map in 2019 was a big boost for the airline. China is Rwanda’s largest exporting partner, making up 21.24% of its total export share value in 2016. The route operates as a fifth freedom route from Mumbai – a smart way to grow its international routes. Pre-pandemic, it had been hailed as a “resounding success.”
This is a vital route for cargo as well as passengers. After suspension at the start of the pandemic, it was quick to resume it for cargo services.
The airline has expanded its route map to Africa, the Middle East, and Europe but not yet the US. Long-haul flights to the US are a major boost for any African airline, and RwandAir is keenly planning the start of such flights.
In early 2021, the airline submitted a request to the US Department of Transport to operate a route from Kigali to New York, potentially starting in December 2021. In February 2021, it was reported that the airline had secured fifth freedom traffic rights to operate from Ghana. However, it will have to meet safety standards with FAA Category 1 rating before operating the route.
Huge potential for African aviation
The airline certainly has regional growth prospects on its side as it grows. The African aviation market has long been seen to offer strong growth potential. In 2018, Africa accounted for 2.8% of total global Revenue Passenger Kilometres (RPK) despite having almost 17% of the world’s population. The average load factor was 71% – 10% less than the global average.
In 2018 (pre-pandemic), IATA forecast annual growth of 5.9% over the 20 years for African aviation – the highest rate globally. Of course, this will have changed in the current market, but the potential for growth in the future remains.
Rwanda is centrally located in Africa and could do well with connections, just as Singapore Airlines does within Asia. It is also a small country with several larger regional neighbors. And amongst African countries, Rwanda has one of the most business-friendly environments.
Alongside its fleet and route growth, RwandAir has steadily grown passenger numbers and revenues but is still struggling to turn a profit.
Passenger volume (according to ch-aviaiton.com) in 2013 was 408,000. By 2016 this had increased each year to reach 586,000, and in 2017 it lept to 885,000. Revenue increased over the same period from $91.6 million to $221.6 million.
Investment from Qatar Airways
With high costs as it grows affecting profitability, an investment could be a real boost for the airline. Qatar Airways believes strongly in growth in the African market. The airline has added many destinations in 2020 and 2021. It also sees partners as important to its growth. It has an interline agreement with Air Côte d’Ivoire in West Africa, and South Africa’s Comair is a future potential option. And it has a strong interest too in Rwanda.
Taking a stake in RwandAir
In 2020, it was reported that Qatar Airways was in talks to purchase a 49% stake in Rwandair. Attention may have shifted during the pandemic, but the intent has not changed. According to reporting by ch-aviation.com, the talks were in their final stages in March 2021.
Speaking with Simple Flying in May 2021, the airline’s CEO, Akbar Al Baker, outlined the importance of his partnership with the central African carrier and the proposed takeover. He explained his vision for this, saying:
“Africa is the most unserved continent, and the airlines that are serving them are taking the passengers to the cleaners. My job is to provide them a world-class airport and partner with RwandAir to give them the kind of service we provide in Qatar Airways.”
If flying picks up in Africa later in 2021, RwandAir could be well placed to capitalize. Hopefully, its investment from Qatar Airways will be finalized, and routes to the US should be on the way. It may have canceled recent aircraft orders, but it retains a young fleet, and could always expand this once the market improves.