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Ethiopian airlines reducing flights, marketing on CNN

By Elias Meseret

Capital

Ethiopian said it is reducing flight frequencies and introducing smaller aircrafts for routes that are hard-hit by the current financial crisis. CEO of Ethiopian Girma Wake told Capital that incoming flights are witnessing a reduction in cargo and passenger loads.
“January flights had a 2% decline in passengers,” Girma said.

However, the flag carrier is still one of the few African airlines maintaining a profitable edge. Reports across the continent show that many airlines are exhibiting a sharp shortage in foreign exchange. The CEO cited that the Nigerian currency, which was exchanged for 115 Naira to the dollar one month ago, now goes for a staggering 147 same.
“The 4-6 weekly flights to the US have been reduced to four. In the same manner, the 14 flights per week to China are now reduced to 12,” Girma explained.

As part of the contingency plan, bigger aircrafts are being also replaced by smaller ones requiring less fuel. Flights to countries like Cameroon are serviced by B757, as opposed to the previously used and bigger B767s. Ethiopian began to feel passenger and cargo contractions in November. But December was when the changes became noticeable to the award winning airline.

Explaining how the lack of foreign exchange affected the company, Girma said it is not as pressing compared to other domestic companies, as only 20% of the airline’s revenue is collected in birr. “Almost 70% of our operation does not touch Ethiopia. It is an entirely different market so we have managed to collect enough foreign exchange for parts and equipment,” he explained.

But this was in respect to intra-African travel where demand for premium traffic rose by 11.8% during the month, according to IATA. Forecasts from the association indicate that growth will slow in sub-Saharan Africa and North Africa, dropping from approximately 5% last year to between 3-4% this year.

Travel in Africa-Europe and Africa-Asia markets has also weakened with premium passengers down 6.6% and 24% respectively.

In a related development, Cable News Network (CNN), one of the world’s leading news outlets, is running Ethiopian Airline’s advertisements from February 9 to March 29. The 30 and 60 second ads depict Ethiopia’s tourist attractions and the airline’s award winning service.

Guenet Berhe, Director of Ethiopian’s Advertisement and Promotion Division, told Capital the CNN deal is part of the continuous and aggressive marketing campaign around the globe by the airline. “We originally planned three months of advertisements,” Guenet said. “But the deal we negotiated for has given us good value.”

As part of the deal with the US based media giant, Ethiopian has secured 104 advertisement spots for broadcast in Europe, the Middle East and Africa with an additional 67 spots for South Asia.

“This translates into eight to 12 ads per day,” Guenet remarked.
Ethiopian has advertised on CNN two years ago and marketed on the British Broadcasting Corporation (BBC) a few months back.

However, some experts question the timing the national carrier chose to present itself and the country on the international stage. “The global slowdown in air transportation due to declines in business travel and tourist flows mean the marketing would be not as influential as it used to be,” an advertisement expert told Capital.

But, Ethiopian insists the advertisements will have a great impact even at this time.
“First, the global financial crisis won’t stop every business and all tourist travel. Secondly, ads are not intended to bring return immediately; instead, it envisions attracting customers in the future,” Guenet explains. “Moreover, the timing means good value for ads as competitors are withdrawing their ads from major broadcasting stations.”