ENTEBBE .
In April 2019, Monica Azuba Ntege posted on what was then called Twitter. It read thus: “I officially received the two CRJ900 aircraft on behalf of [the] Government of Uganda. They will touch down at Entebbe Airport on 23/04/2019.
The choice of Bombardier CRJ900 for regional networks was a result of rigorous analysis of many competing alternatives. Bombardier was the best choice.”
Ms Azuba was posting on social media in her capacity as Uganda’s Works and Transport minister. Uganda Airlines, months away from reviving its operations after a first start in 1977 ended bitterly in 2001, was on the verge of becoming the first flag carrier in Africa to operate CRJ900 planes.
They would be deployed during the short-haul flights of Uganda’s flag carrier.
“I also asked Bombardier to consider establishing a training and maintenance facility in Uganda to skill Ugandans and also enhance Bombardier’s competitiveness in Africa. Uganda is ready to partner with them on this!”
Ms Azuba further posted. Fast forward to this past week, appearing before Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (Cosase), Uganda Airlines’ top brass blamed a Shs237.855 billion loss suffered in the Financial Year 2023/2024 on, among others, the four CRJ900s Ms Azuba purred over in 2019.
They sat uneasily with fuel costs and crew allowances in ballooning the operating expenses of the national carrier.
“The highest, largest contributor to our losses is high fuel costs, followed by depreciation, and then what we call crew allowances,” Ms Jenifer Bamuturaki, Uganda Airlines’ chief executive officer, said while appearing before Cosase lawmakers last Thursday.
She added: “These have had a significant impact on our operational performance. […] the other costs we have, we put them in two tranches. We have direct costs and we have indirect costs.”
Hitting an air pocket
In the tranche of direct costs, the depreciating CRJ900s’ spare parts, notorious for being few and far between, are what keeps Ms Bamuturaki walking the floor nights. Never mind that Ms Azuba promised in 2019 that Uganda would insulate itself from this potential migraine by asking Bombardier to establish “a training and maintenance facility” in the country.
“We have companies that have been providing spare parts for different aircraft. One of our suppliers—Lufthansa Technik—has been providing us spare parts for the CRJs, but they have now informed us that they will not continue to support the CRJ as an aircraft,” Ms Bamuturaki grimly told MPs, adding: “Sometimes we find that those spare parts are not available because they are hoarded.
And by the time you process the monies [to pay for them], the prices will have gone up because someone else has picked it up.”
Dumbfounded, Mr Medard Lubega Sseggona, the Cosase chairperson, asked: “How do you go on the market, get something, and a few years later, you tell me there is no production? Once there is no production, it means that [one,] I will not have spares; two, I will acquire them expensively; three, I will get used spares, and you know how sensitive that can be to the industry.
There were no ready answers; just blame-gaming. Mr Ephraim Bagenda was the chief executive officer of Uganda’s flag carrier by the time the decision was made to run with the CRJ900s. Mr Cornwell Muleya, Cosase members also heard, was the technical advisor.
Apportioning blame, it appears, will only do as much, especially since the national carrier has been left with little choice but to write off the CRJs. The write-off is informed by their inability to expand routes and other related factors.
“The routes that these aircraft operate are under four hours. What that means is that for it to be able to recoup, it has to do frequencies that are much higher, and we have been trying to do that,” Ms Bamuturaki said, adding: “But we have also noticed that the more we push, the more [their depreciation is accelerated].”
Running out of runway?
The solution? Phase out the CRJs and match Uganda Airlines’ competitors on the same routes. “When you look at our competitors that have the same airline or same type of aircraft, they are phasing them out at 10-12 years. So most of them have come to 11th year in those neighbouring countries,” Ms Bamuturaki further offered.
But the CRJs did not come cheap, Mr Ssegona chipped in. He wanted to know if the national carrier would have recouped the money sunk in by the time they—four of them—get phased out.
“Unlikely” was the response from Uganda Airlines’ top honcho. This is a tough body blow to take, said Flight Captain Francis Babu.
“The CRJ,” he told Monitor, “is not a bad aeroplane, but it was a wrong thing to buy for a country like Uganda. For example, it is like you getting a vehicle called Rolls Royce. Who will maintain and get you spare parts here? You will have to source them from there [overseas]. So those are the kind of problems we are having. Even the Airbus, they will have the same problem very soon.”
Uganda Airlines works with two Airbus A330-800s for its long-haul flights. It has placed orders for four Airbus A320neos and two Boeing 787-9s.
Mr Michael Wakabi, a veteran aviation journalist, reckons Uganda’s flag carrier is making judicious decisions. He insists the CRJs “were the right choice for the current phase of development.” He adds that when a bigger aircraft is secured, Uganda needs to open “more longer routes like going to China” which will improve the airline’s financial performance.
As for Ms Bamuturaki, she too is, perhaps unsurprisingly, sanguine. “When we started in 2019, we were using other suppliers. We had Enhas [Entebbe Handling Services] at the time and Das [Handling Limited]. We have since started on our own self-handling project. So we were able to save some money, about $250,000 (Shs884.79 million) because we were [previously] paying for equipment […],” she said.
“In the past, we had SAMCO [aircraft maintenance] that was a supplier that was handling our CRJ maintenance. When their contract ended, we took it on and got approval from CAA [Civil Aviation Authority]. We save about €2 million (about Shs8.27 billion) annually on that process. That gives you an idea that we are working hard to manage our losses,” she added. This article is extracted from Daily Monitor website