my comments - Kenya Airways looking to expand fleet to 70 aircraft

Kenya Airways CEO has officially stated that the airline is looking to double its fleet from the current 35 to 70 aircraft by 2025 and is considering ordering up to 12 Boeing 787-9s to compliment its 8 Boeing 787-8s along with studying the Airbus A321NEO-LR for medium demand routes under an 8 hour flying range from Nairobi. In addition, KQ is seriously contemplating launching new nonstop flights to PEK-Beijing once its new Daxing International airport opens for commercial operations.

As far as network additions are concerned, KQ announced that it will be launching new 4 weekly flights to Rome and Geneva effective 12JUN using a B788 operated as a triangular service.

Sources: 

http://atwonline.com/airframes/kenya-airways-considers-doubling-fleet-70-aircraft and 

https://www.routesonline.com/news/29/breaking-news/281269/kenya-airways-targets-beijing-after-launch-of-new-york-route/

Comments:

KQ’s desire to double its fleet has been talked about for the past 5 years and unfortunately whenever the topic got serious, the airline got a reality check when its annual “net losses” were disclosed us thus forcing it to consider network + fleet cut backs. As long as a route such as JFK is operated on a nonstop daily basis (currently reduced to 5 weekly), the airline has no hope of making an overall net profit as a “stand alone airline entity”.

Currently, KQ operates 35 aircraft i.e. 15 E90s + 8 B787-8s + 4 B737-700s + 8 B737-800s. To double its fleet within 6 years for an airline like KQ is not commercially nor financially feasible.

To begin with, its fleet planning strategy needs to be addressed as for them to consider the A321NEO-LR is a big mistake as it does not need to add another fleet type into the mix especially in the narrow body category when its pilots + engineers are already trained and rated on the B737s for decades.

The current fleet revolves around 3 aircraft types which need to be brought down to 2 in order to realize long term cost savings and efficiencies throughout the airline. This can be done in the below manner:

a) The 15 E90s by 2024 need to be replaced by 15 Boeing 737MAX7s (7M7s). Over here, KQ need to get Boeing to offer them a similar deal to what AC got few years ago when the latter ordered a bunch load of B737MAXs and in exchange Boeing purchased 20 E90s from them. 

b) 4 B737-700s + 8 B737-800s to be replaced by Boeing 20 737MAX8s (7M8s) only

c) The 8 B788s to be replaced by 10 B789s provided Boeing agrees to buy back the 8 B788s in exchange for this above proposed new order. 

d) Total 45 aircraft spread across 2 fleet types only i.e. B737MAX + B787 families 

e) 70 aircraft are not needed and the more long-haul wide body flying the airline does, the higher annual net loss it will end up incurring.

f) The incremental narrow body aircraft need to be used to strengthen a second medium haul departure hub wave bank out of NBO airport