Ethiopian Airlines signed a contract with Sabre Corporation last Wednesday to ensure its continued profitability. The collaboration is based on a research done by travel technology provider Sabre Corporation that claims 6 out of 10 travellers from the United Kingdom and the United States would consider flying in an African carrier if travelling to the continent. This figure rises to 7 out of 10 among Americans aged 25-34 years.
This is a huge potential for all African air carriers to exploit. However, Africa still has the lowest income rate by region for air travel. With the exception of Ethiopian airlines, most are struggling or in a loss. It is to be remembered that in 2014/15 Ethiopian had a profit of $175 million, more than all African airlines combined.
The research aims to change that, “Confidence in African Airlines is the highest it’s been among some of Africa’s key inbound tourism market” said Dino Gelmetti, Vice President EMEA(Europe, Middle East, and Africa) of Sabre Airline Solutions. “This creates a golden opportunity for African airlines to compete globally for inbound passenger traffic, 80% of which is operated by international carriers today. Our research also suggests an opportunity for African airlines to target specific groups of travellers-like young Americans- who are already positive about their brands. By investing in technology, airlines can analyze the needs of these travellers and tailor products and services accordingly.”
An earlier study has revealed that passengers would be willing to spend almost $100 to personalize their journeys, such as leg room, upgrades, and excess baggage. Currently, an average revenue per passenger is about $16. Despite this huge willingness to spend on travel, the top factors that prevent travellers from visiting Africa more often are not knowing enough about the destinations, stressful travel experience, lack of routes to where they want to go, and lastly that the check-in would be too stressful.
Since 2005, Ethiopian airlines has grown at an average rate of 20 -25% per annum, experts state. It is not only the biggest but also the most networked African carrier in terms of a route within the continent as well as in international destinations. It aspires that with this collaboration, its profitability will rise even higher.
Ethiopian Background Information
Founded: December 1945
Starting date of Operation: April 1946
Major Hub: Addis Ababa
Second Hub: Togo, Lome
Third Hub: Lilongwe, Malawi
Ownership: Government of Ethiopia
Chief Executive Officer: Mr. Tewolde G. Mariam
Amount of International Destinations:
- America and Canada: 5
- In Africa: 55
- Europe: 14
- Asia: 17
- Middle East: 13
Number of employees: 13,933
Aircraft Inventory: 92
Fleet on Order: 60
Sabre Corporation Background Information
Headquarters: Southlake, Texas
Countries operational in: 160
Amount of money it processes annually: $120 billion