From East African Business Week

At one time, Kenya Airways (KQ) ruled the East African skies. While neighbouring governments scampered to desperately shore up their loss-making national airlines, KQ could basically charge what it wanted.

KQ also had the advantage of being partly owned by KLM. The Dutch airline provided management advice and technical support. All of which stood KQ well in the early years of its development as neighbouring carriers went into extinction.

Much has changed since then. But the recent entry of low cost carriers (LCC) will probably rank as the most significant. Flying is still relatively expensive in the region. Yet easy transport is central to encouraging business and attracting new investment.

On a postive note, investors see East Africa as a good bet. Fastjet Tanzania (in which easyjet founder businessman Sir Stelios Haji-Ioannou has an interest), is slowly making inroads out of its hub at the Julius Nyerere International Airport. However the biggest prize would be to get landing slots at Jomo Kenyatta International Airport to make it fully regional.

The reason is obvious is that while fastjet has started to achieve in recent months respectable load factors and average fares, Tanzania’s domestic market is not large enough to support an LCC. The carrier currently has 41 weekly return flights in the domestic market, including 21 on Dar es Salaam-Mwanza, 14 on Dar es Salaam-Kilimanjaro and six on Kilimanjaro-Zanzibar. As a result its three A319s have been utilised on average less than five hours per day.

KQ itself, is about to unleash the regional schedule of its LCC, Jambojet. All this should be exciting news for customers, because it usually means lower fares. Going for low-fare airlines can help people save as much as 50% to 80%, especially when booking early. These airline companies usually serve a few routes only and can provide clients with more competitive prices.

Read more at East African Business Week