STATE-OWNED ENTERPRISE
DIANNA GAMES: Steady success of Ethiopian Airlines has lessons for SA’s croaking carrier
Ethiopian Airlines is not breaking new ground in its strategy to become the African carrier of choice. South African Airways (SAA) has been there before. The big Africa push began in the late 1990s when SAA started spending lavishly to replace old aircraft and stepped up capacity and routes to African destinations. It even sold off a stake in the airline to Swissair, to give it access to Swissair’s then-extensive network within Africa and Europe. The take-off, however, did not go according to plan. For example, there were massive hedging contract losses in 2002-03 and Swissair went bust not long after the SAA deal, so the South Africans had to buy back the stake. And even though there was little competition in the African marketplace, it proved tough for SAA. Many of its African ventures were unsuccessful. The team driving the strategy included an imported American team including CEO Coleman Andrews. They saw an aviation landscape that was full of opportunity amid little competition...
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