In order to better compete with Gulf rivals connecting passengers between Asia, the Americas, and Europe, Ethiopian Airlines Group plans to nearly treble its fleet over the next 12 years and increase its global network.
According to new CEO Mesfin Tasew, the state-owned carrier, Africa’s largest airline, plans to boost its fleet size to over 270 aircraft by 2035 from its current 140 aircraft and travel to more than 200 airports worldwide.
The CEO noted that if the plan is effective, commercial and freight operations could produce annual sales of $25 billion, a fivefold increase over 2021.
“We are well positioned to continue growing profitably, expanding our network and competing in the global arena,” Mesfin said in an interview, about nine months after replacing Ethiopian’s long-term head, Tewolde GebreMariam.
Ethiopian, which dominates other African flag carriers despite coming under increased pressure from rivals like Qatar Airways and Emirates, which are expanding on the continent, will enter a new era of growth under the CEO’s strategy.
The organisation is also attempting to grow by establishing new national airlines, such as in Nigeria, and forming agreements in a number of other nations.
One barrier to Ethiopian’s ambition is the lack of progress on a new airport about 70km south of Addis Ababa, the capital. Bole International Airport, the city’s main hub and the airline’s headquarters, is operating at near capacity and will be “a hindrance to further growth,” the CEO said.
Due to issues with land ownership, the construction of the new airport, which was once expected to cost $5 billion and handle up to 100 million people annually, has been delayed by two years and has not yet started.
The desire by rival airlines Kenya Airways and South African Airways to form a new pan-African organisation to more effectively compete with Ethiopian is another obstacle. The two financially troubled airlines are already working together on code-sharing and shared lounge access.
African expansion by Qatar poses a danger to Ethiopia’s hegemony. The airline already has a firm grip on a sizeable portion of the African long-haul market through its hub in the Gulf, competing with Emirates of Dubai, Etihad Airways of Abu Dhabi, and Turkish Airlines. The Doha-based airline has invested in a new airport in Kigali and is currently in discussions with RwandaAir regarding a deeper working relationship.