For the last 18 months, RwandAir has been undergoing major reforms to give it a complete new face. The national carrier has seen major changes including the acquisition of its first own fleet. In an exclusive interview with The New Times’ Reporter Berna Namata, the Airline’s Chief Executive Officer (CEO) Gerald Zirimwabagabo elaborates on the the reforms carried out so far.
Below are the excerpts:
RwandAir recently acquired its first own aircrafts- the CRJ-200 series. How is this impacting on your business?
It’s been a very short time for us to report accurately any significant impact in the business.
But measuring from all the congratulatory messages we have been getting from our clients, the general public, we know that our clients are very happy to see that we have acquired our own aircrafts. They are well maintained aircrafts, in good shape and we have brought very experienced pilots from abroad to fly them.
We have also contracted Lufthansa Technics, one of the very best in this game to do maintenance for us. This is all intended to give maximum confidence to our clients that our aircrafts are safe and efficient. So we think with all these put together, we should be able to realize a good response from the market.
What are your plans for expansion, do you have any plans of purchasing more aircrafts?
Those plans have been mooted.We intend to continue purchasing aircrafts- in fact we are looking at another 2 -3 aircrafts in the first half of this year – bigger aircraft (Boeings) to do longer routes like Johannesburg , Kinshasa , Dubai – so in the next couple of months we are planning to acquire more aircrafts.
The CRJ – 200 series were purchased after you received a $40 million loan from the Eastern and Southern African Trade and Development Bank (PTA). What are your plans for repayment of this money?
We have a business plan that tells us how – the reason we were not making a lot of money in the past is because of wet lease aircrafts which are very expensive. Now with our fleet, we know our costs are down. In this we will offer more reliable and better service. So we are sure that business is going to improve and we will be able to meet all our costs including the loan.
I mus inform you that we have so far only used 13 million to purchase the CRJs and we are looking into another 11 million at the end of March from PTA bank. The 11 million will be going to purchasing the new aircrafts that we want.
Talk about the RwandAir venturing into new routes has been around for sometime, when will words turn into action?
Well of course it will be different- because the opening of new routes depended on us acquiring new aircrafts which have since arrived.
You recently purchased staff uniforms but the employees rejected them. Did Rwandair lose money in the process?
Media reporting on that appears to have been inaccurate. The tender for uniforms was worth US$47,000. Some things were not clear in the procurement process. We are trying to ascertain whether it was just a bad contract or whether it was a bad choice by our tender committee. But we never lost money as media reports said.
For example they ordered shirts for ladies which were the same color with the men – clearly that did not come out well. We had to figure out what happened - we got all the Uniforms worth US$47,000 – but there are some things we did not use like those neckties or the shirts which were the wrong colour for men.
We have them in stock and they are worth US$7000. It is true it was not done in the best way possible. It happened at a time when we were still reorganizing ourselves. We were actually reinforcing our procurement procedures through strengthening our procurement committee.
You must recognize that Rwanda Air is coming from a period of mismanagement and that is changing. In the process of doing that- some things are not done as well as they ought to be done.
But as a result of those issues that were not clear, we commissioned an audit and we have an audit report – we will use that audit report to take action and to find out whatever went wrong.
We have the uniforms within our stores while the press has been saying that we have donated the uniforms. It is good to be accurate. In short I must say that much as there have been issues here and there we did not suffer a loss.
The balance amounting to US$7,000 constitutes the outstanding issues that we need to sort out which is actually normal in business.
You contracted Sun Air to do business for you but they never honored the deal you signed. Will you take them to court?
All the time, we have been wet leasing aircrafts and we pay a deposit up front to the company that leases the aircraft. When you pay a deposit, even when you have a contract, the other party can choose to disregard the contract.
But of course you have options including taking them to court. Or you can persuade them to pay you back the deposit and if they fail you take them to court. We are in the process of recovering the money, because Sun Air towards the end did not fulfill their promise to complete the contract.
It is a question of time. We are negotiating with them. I can not say we have made a lot of progress but issues like takes time. Even when you go to court, it will most likely take some time. It happens all the time in business.
Let me make it very clear here. In our contract with Sun Air they we meant to do 15 flights but they only managed slightly less than that. In fact it was the last flight that we did not do.
What was the extent of the loss you incurred during the recent plane incident involving your leased aircraft?
I do not think I should talk about the plane crash because we still have not seen the results of the investigations. I really do not want to speculate. We know why the plane crashed – we have an idea coz one of gears was stuck. The investigation is on, so we should allow the investigation to conclude its work.
As we have kept telling the media, the aircraft did not belong to RwandAir, it was a wet lease. Of course in some way we may have incurred costs - for example our image – suspended flights and issues like that but this is not directly related to the aircraft.
If we had another aircraft our flights would have been rescheduled in spite of the crash. In terms of our brand, in terms of our image, definitely there is a cost.
What we are trying to do by bringing in new aircrafts is to bring back confidence in the flying community that our brand espouses safety which is key in our industry.
What is the status of your application to acquire IATA Operational Safety Audit IOSA membership? What are the benefits?
We are getting ready, the only thing that was holding us is lack of our own aircrafts -now that we have our won fleet it we are looking at the next two, three months to become members.
The member ship is intended to build a club that works together with harmonized standards. Because we are a small airline- the more organizations you join, the better and faster you grow.
Looking ahead, what is the future of RwandAir?
Very bright. We are building a very strong management team for RwandAir. We are acquiring assets that will enable us to spread our wings.
We are building alliances with other airlines, we are training our staff and recruiting our own pilots and engineers - our own locals to strengthen RwandAir operations.
We are looking at growing our business plan beyond our borders, so I have no doubt that – and looking at what we are coming from, only 18 months, things have charged drastically in Rwanda Air. They will even change faster in the next months. I have no doubt about that.