Fastjet Launch and Partnership with Swissport

RNS Number : 0539S

Fastjet PLC

27 November 2012

 



27 November 2012

fastjet plc

("fastjet" or the "Company")

fastjet Airbus unveiled as Tanzanian government  welcomes Africa's first Low-Cost Airline;

Africa-handling partnership with Swissport agreed

fastjet, Africa's first low-cost airline, has today unveiled its first fully branded aircraft ahead of commencing flight operations in Tanzania in two days' time. At an industry event in Dar es Salaam, government officials, fastjet executives and aviation experts watched the Fastjet Airbus A319 take to the skies for the first time.

From Thursday, 29^th November, fastjet will operate twice daily flights on its first two routes, Dar es Salaam to Kilimanjaro and Dar es Salaam to Mwanza, both popular domestic destinations. Tickets went on sale two weeks ago and fastjet has recorded strong demand; outstripping its initial expectations.  Average fares are expected to be $80 but now start from as low as US$20 one-way (excluding taxes and charges) for customers who book early.  Representing the Tanzanian Ministry of Transport, Deputy Minister Mr Charles Tizeba was also present at today's launch and welcomed fastjet's entry to Tanzania; demonstrating the government's support for the new airline. 

Speaking today in Dar es Salaam, fastjet Chief Executive Ed Winter said:

"Today is an incredibly exciting day not just for fastjet, but for Tanzania and Africa as a whole. For years, the African aviation-market has been significantly underserved, lagging a very long way behind the rest of the world.  GDP growth is fuelling a real increase in disposable incomes and consumer spending and although this is accompanied with a growing demand for travel, the African people just haven't had a reliable and affordable air travel option available to them. fastjet will now serve to fill that gap and we look forward to bringing the people of Tanzania and indeed the whole continent the first pan African low cost, point-to-point, all jet airline, operating to international standards of safety and quality."

fastjet is committed to becoming a large scale local employer and will recruit and train people on the ground. It has already hired over 70 local people in Tanzania in a variety of roles including cabin crew and sales staff and recruitment is expected to continue as the airline takes delivery of more aircraft.

Commenting on today's launch, John Leahy, Airbus Chief Operating Officers: Customers, said:

"fastjet's decision to base its fleet on A319s is testament to the aircraft's efficiency, reliability and suitability for the low-cost operations in Sub-Sahara Africa.   With the market-leading modern Airbus single-aisle aircraft, fastjet will be introducing new levels of comfort and affordability to an African market which is set to double over the next 20 years."

fastjet will be run by an experienced aviation team led by Ed Winter, former Chief Operating Officer at easyJet and founding director of low-cost airline Go, Chief Commercial Officer Richard Bodin, former Contracts Director at easyJet and Business Director of low-cost airline Jet2.com, Operations Director Rob Bishton, former Chief Pilot & Head of Aircraft Operations at easyJet and General Manager of Africa Kyle Haywood, former Chief Executive of Air Uganda.

Fastjet operates under a brand licence agreement with easyGroup Holdings Limited and Sir Stelios Haji-Ioannou, founder of a leading low cost airline, easyJet.  Commenting on the launch, easyGroup Holdings Chairman Sir Stelios said:

"Now it's Africa's turn! I am delighted to have played a small part in starting yet another revolution. I wish everyone involved happy landings!"

The airline anticipates that passenger numbers, which under the Fly540 brand currently stand at 750,000 per year could significantly increase following launch, as fastjet plans to operate a fleet of up to 15 A319s over the coming year.

fastjet's first base is in Dar es Salaam and its second base in Nairobi is planned to open in spring 2013. Once established in East Africa, the airline has plans to launch in Accra in Ghana and Luanda in Angola.

fastjet is also delighted to announce today that it has signed an agreement with Swissport International, the world's leading provider of ground services to the aviation sector, under which it will provide ground services throughout the airline's network.

Through an exclusive partnership agreement Swissport will supply a variety of airport services, be responsible for service delivery and support supply chain growth throughout the fastjet network.

Juan Jose Andres Alvez, Swissport's Executive Vice President of Ground Handling for Europe, Middle East, Asia and Africa, commented: "Swissport has a huge amount of experience in LCC handling in Europe and we look forward to assisting fastjet in building up this model in Africa, supported by our knowledge and processes. This partnership includes all of the logistics challenges involved in setting up a network of ground handling operations and management systems, representing a new type of relationship between service provider and airline and offering a great opportunity for Swissport to continue to build its network in Africa in partnership with fastjet."

fastjet Chief Executive Officer Ed Winter commented:

"Swissport has a world-leading reputation and track record for providing high quality ground services to airlines around the world. fastjet is creating a pan-continental African airline offering international standards of safety, quality, security and reliability and it is therefore essential for us to have a handling partner that gives these qualities top priority and one that also matches our ambitious growth plans for Africa."

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NOTES TO EDITORS

About fastjet plc

fastjet Plc is the holding company for African airline Fly540, which operates from four bases in Kenya, Tanzania, Ghana and Angola.  Fly540 currently has 10 aircraft serving around 25 domestic and regional destinations, carrying approximately 750,000 passengers per year with a strong emphasis on safety, security and reliability.

Following a consultancy assignment by easyJet founder Sir Stelios Haji-Ioannou's easyGroup focused on determining the feasibility of launching a European-style low-cost carrier in Africa, we are now preparing for the launch of fastjet, Africa's first low-cost carrier, flying a modern fleet of jet aircraft based on the Fly540 platform of licences and routes. First flights under the fastjet brand are expected to take place late November, bringing an entirely new flying experience to the African market.

Passenger numbers for the month of October stood at 51,015, up 26.6% on the same month last year.

fastjet Plc is quoted on the London Stock Exchange's AIM market. For more information see www.fastjet.com

Significant African Aviation Market Potential

Africa is a growth aviation market with regional and intercontinental traffic both growing rapidly as a result of the continent's continued economic expansion.  With over one billion people, Africa is hampered by poor infrastructure, a lack of roads and railways and long distances between urban populations.  The African aviation market is significantly underserved with air travel spending as a percentage of GDP a fraction of that of other emerging markets.  With rapid economic growth and, as a result, the growing wealth of African citizens, more and more people will be able to benefit from aviation and fly for the first time. Airbus forecasts total passenger traffic in Africa will grow at an average yearly rate of 5.7% between 2010 and 2030, well above the 4.8 per cent world average growth rateand expects to deliver more than 1,100 new passenger aircraft, 4% of world deliveries, in the next 20 years to satisfy growing demand. Seven of the top 10 fastest growing global economies are now in Africa with consumer spending for the continent forecast to reach US$1.6 trillion by 2020.  A recent McKinsey report (June 2010) forecast that 128 million households in Africa are expected to have discretionary income to spend by 2020, while 50% of Africans are expected to live in cities by the same date with urban jobs bringing rising incomes. The McKinsey report concluded that today the rate of return on foreign investment in Africa is higher than in any other developing region and that early entry into African economies provides opportunities to create markets, establish brands, shape industry structure, influence consumer preferences and establish long-term relationships.

The Low-Cost Airline Model

The low-cost airline model seeks to attract large numbers of additional passengers by offering significantly lower fares.  The fares need to be low enough to persuade people who did not previously travel by air to do so, and others to travel more often.  The global experience of launching a low-cost carrier is that it creates a completely new market rather than a redistribution of market share in the existing market.

 

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