Government officials in Freetown, Sierra Leone, are anxiously hoping that the nation’s dogged determination to maintain an airline – against formidable economic odds – will begin to pay off this year.
Their hopes have been raised somewhat by the disclosure that Sierra Leone Airlines’ scheduled tonne-kilometre performance in 1983 compared with 1982 was the highest growth rate achieved by any member of the International Air Transport Association (IATA).
But the volume of traffic remains small. On both international and domestic services in 1983 Sierra Leone Airlines (SLA) carried a total of 28,913 passengers and 429 tonnes of freight, its passenger-load factor on international routes was 35.9% against a world average of 62.7% and a 1982 African average of 59%. Understandably, the carrier’s annual results for 1984 are being awaited with baited breath.
The problems confronting SLA are in no way unique and are faced by many cash-strapped national airlines in Africa which have to compete with larger, established carriers in the fiercely competitive and capital intensive world of air transport.
Formed in June, 1982, with a share capital of 10 million Leones, SLA is a partnership between the Sierra Leone Government, which holds 60% of the shares, Royal Jordanian Airlines, Alia (20% shares) and some prominent Sierra Leone businessmen (20% shares). Alia was given a three-year contract to manage the airline and provide aircraft and technical support. The new carrier succeeded the ill-starred Sierra Leone Airways which was jointly owned by the Government (51%), British Caledonian (43%) and private interests (6%). The split between the Government and British Caledonian ended a 20-year relationship during which the British airline had managed Sierra Leone Airways’ domestic operations as well as its scheduled flights to London.
Alia quickly stepped in to replace British Caledonian but the immediate ban imposed by the British Government on SLA’s traffic rights into the UK – until Sierra Leone remitted British Caledonian’s outstanding earnings – did not provide an auspicious beginning for the fledgling airline. The tit-for-tat ban on reciprocal traffic rights was eventually lifted and the two former partners now compete for the same international traffic between Sierra Leone and Britain.
An obvious disadvantage for SLA is that it cannot match the modern, wide-bodied aircraft used by British Caledonian, UTA, KLM and its other foreign competitors and while its agreement with British Caledonian stipulates that neither airline can carry more passengers than the other on the same routes – regardless of aircraft-seat capacity – many passengers have opted for the comforts of British Caledonian’s state-of-the-art aircraft.
SLA’s own fleet consists of one, narrow bodied Boeing 707, one Boeing 720 and two Britten Norman Trislanders. The B707 has been wet-leased from Alia since 1982 and, apart from the considerable costs this involves, is old, fuel inefficient and expensive to maintain. In addition, new noise restrictions in Europe mean that this class of aircraft will soon not be permitted entry. The B720 was a gift to Sierra Leone President Siaka Stevens from Jordan’s King Hussain, but technical faults and lack of spare parts have long since grounded it. As for the ageing Trislanders, which are used on domestic routes, high operational and maintenance costs have rendered them uneconomic.
With its low asset base and rate of return SLA is not in a strong position to resort to the money markets to raise funds to finance the modernization of its fleet. At present, it has neither sufficient capital nor traffic capacity for a new, extended range Boeing 767-200, an Airbus Industrie A310 or a McDonnell Douglas DC-10-30 trijet. And yet, as a senior SLA executive explained “We do need a change of aircraft to compete with British Caledonian and so have to replace our existing equipment with something else.” The risks inherent in an airline relying on a single aircraft for all its international services are readily acknowledged: “Obviously, there is a danger. But even if we could afford a wide-bodied plane it would still be only one aircraft and the risks would remain. The feeling therefore is that it would be wiser to acquire two decent, second-hand planes rather than a single new wide-bodied jet.”
So far, the airline has not decided whether to purchase second-hand aircraft outright or to continue its leasing arrangements. Sierra Leone nationals are already under training to replace foreign pilots and the lower cost of dry-leasing, as opposed to wet-leasing, would reduce expenses significantly. Alia’s management contract expires in April this year and the decisive factor influencing whether it will be renewed is likely to be if better, fuel-efficient aircraft can be provided to replace the B707. “If they haven’t got the aircraft we need to service the routes successfully then renewing the contract is pointless,” said an SLA official.
The priority attached by both Sierra Leone Airlines and its predecessor to international services, as a means of earning vital foreign exchange, has meant that domestic services have had to be put on the backburner. But Sierra Leone’s need for a vastly improved domestic air network remains. Such a network would improve internal communications considerably and provide a key to open up the country for further economic and social development. Increased commercial ties between Sierra Leone and its immediate West African neighbours, an important Government objective, would be made possible once new aircraft and more regular regional services were introduced.
The heavy promotion of Sierra Leone’s tourist attractions, in particular its pleasant sandy beaches, is a key element in SLA’s marketing strategy in Europe, but the inconvenience long-haul travellers experience in getting from Lungi International Airport to Freetown, by means of an often irregular ferry service across the river estuary, is thought to constitute a drawback. The construction of a new airport has so far been ruled out by the sheer capital investment required.
As might be expected, given the enormous costs involved in running an airline and Sierra Leone’s present dire economic situation, the past 32 months have witnessed both ups and downs for Sierra Leone Airlines. But SLA officials remain optimistic about the carrier’s future and insist they are not in business merely for reasons of national prestige.
Only recently, the First Vice President of America’s Export-Import (ExIm) Bank, John A. Bohn, warned that airlines run for prestige would always run at a loss. ExIm Bank has financed the purchase of Boeing aircraft by many African airlines. In the case of Sierra Leone Airlines, if faith and determination alone could ensure an airline’s success, Government officials in Freetown would have very little cause for concern.