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London, England (CNN) -- A new budget airline backed by easyJet founder Stelios Haji-Ioannou will soon take to the African skies, promising to bring low-cost flights to millions of people in the continent.


Dubbed Fastjet, the no-frills carrier is expected to launch in three to four months, aiming to cash in on Africa's robust economic growth and a growing appetite for travel by its burgeoning middle class.

The move comes after Haji-Ioannou's easyGroup teamed up earlier this month with pan-African conglomerate Lonrho to create the low-cost carrier. Lonhro, owner of budget airline Fly540, has agreed to sell its aviation business to investment firm Rubicon Diversified Investments, in which easyGroup will hold a 5% stake.


The new business will start operations using Lonrho existing network in Ghana, Kenya, Tanzania and Angola, before expanding to more markets in the future.


"These four countries are currently experiencing great GDP growth, along with oil and gas discoveries and developments," says Ed Winter, chief executive of Fastjet.


"We believe that the time is absolutely right to change Fly540 into a much bigger airline based on the low-cost model which has been successful in every other part of the world," adds Winter, who is easyJet's former chief operating officer.


The business, which will still be majority-owned by Lonrho, has set a target of carrying around 12 million passengers per year, "which creates an airline of roughly 40 aircraft," according to Richard Blakesley, Fastjet's finance director.


The low-cost carrier expects to offer average fares of $70-80 before tax, which could fall to as much as $15-20 when booked early.:banana:


"That price will absolutely democratize air travel, totally changing the way people are traveling in Africa," says Winter.


Fastjet executives say they hope to tap Africa's rather underdeveloped aviation network, offering an affordable alternative in a transport environment largely dominated by difficult terrains, long bus journeys and poor infrastructure.

Haji-Ioannou, who set up easyJet in the mid-1990s, has described Africa as "the aviation industry's last frontier."


"Past experience shows by halving fares, a successful low-cost carrier can encourage those people, who have never previously traveled by air, to fly. For Africa, with its densely populated cities separated by great distances -- this means a potential new market of millions," he said after the reverse takeover by Lonhro.


In 2011, low-cost carriers occupied 9% of the African market, suggesting that there is a large potential for further development and growth, says aviation expert Linden Birns.


He notes, however, that the big challenge for airlines is breaking into cross-border flights and launching intra-African routes.


"At the moment access to markets on a transnational basis is governed by a set of bilateral air transport agreements," says Birns, founder of South Africa-based aviation consultancy Plane Talking.


"Under those agreements, governments stipulate who's allowed to fly and how many flights. That really keeps a lid on things -- if you can break through those barriers and introduce competition then we should see some pretty rapid growth happening in the market."


Aircraft manufacturer Airbus has forecast Africa traffic to expand by about 6.5% per annum between 2011-2020 and by 4.9% between 2021-2030, for a 20-year growth rate of 5.7%. This compares with a 4.8% increase in demand on a worldwide basis over the next 20 years.


"It's no secret that Africa represents a massively untapped market," says Birns. "If we look at where growth is happening in the world, Africa is certainly up there."


Birns says that as Africa's cities get more populated and as demand for business is growing, the expansion of the low-cost model should revolutionize the continent's air transport in the same way that it did in North America, Europe and now in Asia.


"More people will be able to trade, more people will be able to do their tourism and it should be a good economic driver," he says.


Fastjet's foray into the African market comes amid a tumultuous time for aviation industry in the continent -- earlier this month, a plane crash in Lagos, Nigeria, killed all 153 people aboard.


Winter says Fastjet will raise the bar on safety and security, operating "as though it was an European airline."


"There's no reason why Africans shouldn't be just as safe and secure as in an European airline and we will follow those sort of procedures," he says. "Now, that adds a bit cost to our operation but to my mind all of those costs are actually worthwhile to provide a safe and secure airline."


Looking ahead, Winter says the biggest challenge for Fastjet is dealing with lack of airport infrastructure, as well as high taxes imposed by governments and rocketing fuel duties.


"What we're hoping is that governments will realize that by allowing these tax levels to come down to more normal levels, we will be able to do most markets and their total revenue will actually increase," he says.


But despite the challenges, Winter says he is "incredibly excited" about the venture, saying that there isn't a better time to enter the African market.
"Five years ago it just wasn't that level of GDP growth, the spread of wealth amongst the population and the level of investment," he says, "Whereas now I think all those factors come to play and now it's exactly the right time to do this."
http://edition.cnn.com/2012/06/27/business/fastjet-africa-stelios-haji-ioannou/index.html?hpt=hp_mid


Loooooong overdue, but I am very disappointed that African airlines haven't taken this initiative.
 

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saw this a few weeks ago, great news as more people will choose to fly more within africa which was too expensive to previously.
 

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RIP to Fly540 but in terms you have brought Fastjet that will raise kenya ranking's even higher.
 

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RIP Fly540. Maybe its greatest legacy will be that its new incarnation 'FastJet' will use NBI as a hub as it grows throughout the continent.
 

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èđđeůx;92779530 said:
They'll be forced to if they already haven't. I only know of KQ saying it will start a low-cost carrier (Jambo Jet), the rest I haven't a clue.:dunno:
In future, many such low-cost carriers will be around.Travelling within Africa will be much cheaper than it is.
 

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lordangers
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It always amazes me how I can get to Luton airport in under an hour for just £20. Incrediable to think I can be touching down in Africa for the same price. Great news.
 

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This is great news indeed. It's a shame no African airline has done something like this, I think they've always targeted Africans who can afford airline tickets and foreign tourists only and never really even bothered to appeal to low-income travellers.
 

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I just read the news on an aviation forum and I somehow doubt that a pan-African low-cost airline will be successful.

The entire low-cost airline concept depends on short-haul routes with very short turnaround times and as little red tape as possible in order to be profitable.

For starters most of those routes will be significantly longer than those of Easyjet in Europe. Even a route such as ACC-NBO is already more than 300km longer than Easyjet's longest route (LGW-SSH). Considering how much fuel a jet needs for a 5-hour flight, average fares of $70-80 just don't seem to be realistic in order to break even.
That's also why you don't have any pan-Asian low-cost airlines, but only low-cost airlines that focus on South East Asia, China or India. $80 flights from Japan to India wouldn't be profitable either.

Add the amount of red tape that exists in the African aviation industry which additionally pushes up costs and I just don't see how it will work.
 

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^ I doubt it would work well either if it was a long haul transcontinental route. Something like a Kenya to Ghana flight? That would be a nonstarter. I doubt there isn't much demand and the conventional airlines can already fill that demand well.

But maybe something like a low-cost flight from Nairobi to Dar Es Salaam or Kampala would be an optimal route to test if this model would work in Africa.
 

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I just read the news on an aviation forum and I somehow doubt that a pan-African low-cost airline will be successful.

The entire low-cost airline concept depends on short-haul routes with very short turnaround times and as little red tape as possible in order to be profitable.

For starters most of those routes will be significantly longer than those of Easyjet in Europe. Even a route such as ACC-NBO is already more than 300km longer than Easyjet's longest route (LGW-SSH). Considering how much fuel a jet needs for a 5-hour flight, average fares of $70-80 just don't seem to be realistic in order to break even.
That's also why you don't have any pan-Asian low-cost airlines, but only low-cost airlines that focus on South East Asia, China or India. $80 flights from Japan to India wouldn't be profitable either.

Add the amount of red tape that exists in the African aviation industry which additionally pushes up costs and I just don't see how it will work.
They are using an existing platform of fly540 airlines which was very successful in initiating a low cost system which flew to 16 destinations across the continent and it was actually Africa's first pan-African carrier. Fastjet is fly540 but in new words but it will be operating the same way
 

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:D The problem is not in the compagnies but in the politic. Morocco have an open sky with europe but the governement play with taxes to attract low cost flight when they need them or to chase them when the politic go for helping locals who suffred in last few years from both high gaz prices and cruel competition.

so the answer for Easy Jet will depend on each country policy.

Ryanair announces reductions in services to Morocco
Friday, June 29, 2012
Ryanair announced the cancellation of 34 weekly flights (250,000 annual passengers) to/from Morocco because ONDA, the Moroccan Govt’s airports authority, has reneged on its agreement with the airline by imposing a new monopoly handling company on Ryanair which would have resulted in a massive increase in charges for the airline. ONDA has refused to guarantee Ryanair the continuation of the cost levels of its original agreement. Consequently, Ryanair has no alternative but to announce substantial reductions to its flight programme to Moroccan airports which will include reductions of 8 weekly frequencies at Nador, 6 at Fez, 8 at Marrakesh, 4 at Tangier and the complete closure of its operation at Oujda Airport (8 weekly frequencies).

Announcing the reductions, Ryanair’s Deputy Chief Executive, Michael Cawley said; “Ryanair entered into long term agreements with the Moroccan Tourism Authority and ONDA, as part of the Moroccan Govt’s 5 year plan to grow tourism. Ryanair has spectacularly over-delivered on all its undertakings under these agreements, becoming Morocco’s second largest airline and ensuring the Moroccan Govt achieved its 5 year targets within an earlier timescale. It is regrettable that ONDA has now lost sight of the key to the success of our partnership, offering low fares based on low costs. Ryanair cannot accept cost increases as it seeks to deliver more growth to Morocco. It is completely unacceptable for ONDA to increase the cost of Ryanair’s operation in Morocco and unrealistic for them to expect us to continue to grow our business in that context.

Consequently I regret to announce that we are making these substantial reductions which will result in up to 100,000 less tourists annually and an annual loss in tourism expenditure and job losses for the Moroccan economy of 50m. euros. Ryanair will now allocate this capacity elsewhere to the many markets earnestly seeking Ryanair’s growth and that are offering long term, sustainable cost bases to underpin Ryanair’s guaranteed low fares.”
 

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Mutu ya Chuma.
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This is good news of course. But i hope it gets in DRC, because we have ridiculously expensive flights , more expensive than in the US internal/local flights :nuts:
 

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^^Well what airlines do you have besides Korongo & LAC? If just them then no surprise tickets are expensive. -_-
 

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èđđeůx;92896406 said:
^^Well what airlines do you have besides Korongo & LAC? If just them then no surprise tickets are expensive. -_-
CAA, Fly-Congo as well....( LAC doesn't function anymore).
 

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I just read the news on an aviation forum and I somehow doubt that a pan-African low-cost airline will be successful.

The entire low-cost airline concept depends on short-haul routes with very short turnaround times and as little red tape as possible in order to be profitable.

For starters most of those routes will be significantly longer than those of Easyjet in Europe. Even a route such as ACC-NBO is already more than 300km longer than Easyjet's longest route (LGW-SSH). Considering how much fuel a jet needs for a 5-hour flight, average fares of $70-80 just don't seem to be realistic in order to break even.
That's also why you don't have any pan-Asian low-cost airlines, but only low-cost airlines that focus on South East Asia, China or India. $80 flights from Japan to India wouldn't be profitable either.

Add the amount of red tape that exists in the African aviation industry which additionally pushes up costs and I just don't see how it will work.
Their hubs (Ghana and Angola) will be in oil producing countries, making the price of oil cheaper I guess. But I'm not too sure of if this will likely help in offset fuel prices.
 

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Mutu ya Chuma.
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I just read the news on an aviation forum and I somehow doubt that a pan-African low-cost airline will be successful.

The entire low-cost airline concept depends on short-haul routes with very short turnaround times and as little red tape as possible in order to be profitable.

For starters most of those routes will be significantly longer than those of Easyjet in Europe. Even a route such as ACC-NBO is already more than 300km longer than Easyjet's longest route (LGW-SSH). Considering how much fuel a jet needs for a 5-hour flight, average fares of $70-80 just don't seem to be realistic in order to break even.That's also why you don't have any pan-Asian low-cost airlines, but only low-cost airlines that focus on South East Asia, China or India. $80 flights from Japan to India wouldn't be profitable either.

Add the amount of red tape that exists in the African aviation industry which additionally pushes up costs and I just don't see how it will work.
Interesting......if thats the case , that wouldn't even work in DRC, let alone Continental.
^ I doubt it would work well either if it was a long haul transcontinental route. Something like a Kenya to Ghana flight? That would be a nonstarter. I doubt there isn't much demand and the conventional airlines can already fill that demand well.

But maybe something like a low-cost flight from Nairobi to Dar Es Salaam or Kampala would be an optimal route to test if this model would work in Africa.
Perhaps that. since they are short distances. But , would these governments let the flagships Airlines take the heat? (Kenya and Ethiopia Airways ).
 

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I'm waiting for cheaper transcontinental flights from Europe to Africa.
Why a flight from for example Schiphol (Holland) to Bangkok (Thailand) is cheaper than a flight from the same Schiphol to somewhere in Africa while the distance to Africa is much shorter.
Are the planes to Asia flying on water?
I know its because of offer and demand but why you don't have more companies flying to Africa.
Whenever I fly to Africa I see that the plane is full, so there is enough demand.
 
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