Ethiopian Airlines finds new way to cope with COVID 19 economic impacts

Ethiopian Airlines has won a 10 million dollars contract for cargo service to deliver supplies useful to prevent COVID 19 

Ethiopian Airlines _ COVID 19
Photo credit : FBC

borkena
April 19, 2020

The aviation industry is experiencing unprecedented economic challenges the world over due to the COVID 19 impacts. Ethiopian Airlines is not an exception. 

It has grounded over 90 planes, suspended passengers’ flights to over 90 destinations around the world. In early April, Tewolde Gebremariam, CEO, reported a  550 million US dollars in revenue loss. 

Yet, the airline has found a new way to cope with economic challenges, the likes of which are unknown in recent history.  The cargo service and maintenance services are bringing in trickles of revenues as the airline is bracing for three months of economic hardships. 



According to the CEO, Ethiopian Airlines has made ten 777  and two 737 planes available for cargo service across the world. Currently, it is even expanding the cargo service flying from Asia to Europe, and different parts of Africa. Eight of the planes were used for passengers before the economic downturn. 

This week, the airlines got a ten million dollars contract from the World Health Organization (WHO) and the World Food Program (WFP) to deliver medical equipment and supplies to different parts of Africa. 

In the views of the CEO, three factors contributed to the selection of Ethiopian Airlines to deliver those supplies.  

The number of planes it has made available for cargo service and the number of destinations, the experience to coordinate delivery in a short period effectively, and it’s cargo terminal facility, which has a capacity of storing up to one million tonnes per year. 

Steven Were, WFP representative and country Director seem to agree with that. Explaining why Ethiopia Airlines is selected to deliver supplies to African countries, he said “In terms of handling cargo sorting it and distributing it across the continent through Ethiopian airlines, really there is only one place that could happen and that’s here in Ethiopia, Addis Ababa,” as quoted by Ethiopian Airlines. 

In late March 2020, Ethiopian delivered to over 49 African countries test kits and protective devices donated by the founder of Alibaba, Jack Ma. 

Last week, the airline disclosed that it “has repatriated over 1000 Canadian residents and diplomats from various countries including, Nigeria, Sudan, Burkina Faso, Côte d’Ivoire, Mali, Senegal, Democratic Republic of Congo, Keyna, Malawi, Zimbabwe, Cameroon, Ghana, Tanzania, Turkey and Mozambique.” 

Asked if Ethiopian Airlines is seeking financial support from the Ethiopian government, Mr. Tewolde said that the airline is bracing for three months, without laying off employees. However, if the slowdown continues for an extended time, he said: “we will consult with our government.” 

The main challenges for the airline at this time, Mr. Tewolde pointed out, are debt repayment for purchased planes and rental charges for planes – which are now grounded. 



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