Business
Fastjet – low cost African Airline launches
(Reuters) – Fastjet , the African budget airline backed by easyJet founder Stelios Haji-Ioannou, said it would temporarily shelve plans to launch domestic routes in South Africa to focus on rolling out international flights from Tanzania.
The African start-up airline said on Friday it had been granted permission to launch international flights from Tanzania to South Africa, Zambia and Rwanda after receiving route approvals from the relevant governments under the Bilateral Air Services Agreements (BASA) between Tanzania and the other countries.
However, the company said it had decided to put the launch of fastjet-branded domestic routes in South Africa temporarily on hold to focus on launching international services as soon as possible.
“We remain totally committed to launching the fastjet brand in South Africa as soon as possible … we have taken the sensible decision to prioritize setting up these lucrative and high profile routes first, before turning our attention to launch the fastjet brand on domestic routes in South Africa,” Ed Winter, fastjet’s chairman and chief executive, said.
Winter added that the company would soon announce launch dates for flights to Johannesburg, Kigali and Lusaka from Dar es Salaam in Tanzania.
Fastjet, which has ambitions to become the first pan-African low-cost carrier, was created following the acquisition of African airline Fly540, and operates from four bases in Kenya, Tanzania, Ghana and Angola.
Fastjet, which has 10 aircraft serving around 25 destinations within Africa, on Thursday said it had agreed to create a low-cost airline operating within Nigeria and across Africa with Nigeria’s Red 1 Airways.
Fastjet also said it had signed a new three year equity financing agreement for up to US$23.5 million with Darwin, a subsidiary of Henderson Global Investors Volantis Capital.
Fastjet’s Airbus A319s will initially be based in Dar es Salaam, Tanzania, but expansion to Kenya is planned for later this year.
Whether the low-cost model will become a resounding success will depend on much more than just airline economics. The willingness of African governments to liberalize is a key factor in Fastjet’s development.