Air Transport World

Where other fear to fly. (Ethiopian Airlines)(includes article on proposed investments by Ethiopian Airlines)

At 50, Ethiopian Airlines prospers with operations over long, thin routes that consequently, produce little competition

ADDIS ABABA--Celebrating its 50th anniversary next month, Ethiopian Airlines long has used the slogan "Bringing Africa together." In fact, route pioneering not only within Africa but starting the first direct flights from Africa to China brought the carrier an ATW award, the first to go to an African airline.

That was in 1973. Since then, Ethiopian has extended its wings to virtually every country south of the Sahara. The route-development strategy continues to focus primarily on long, thin routes that no other airline has been bold enough to pioneer.

But courage has paid off and after aft initial period of low load factors and deficits, the new services have become profitable. In fact, Ethiopian has been consistently profitable since 1960. However, the present government felt that the airline should have been earning even larger profits in the early 1990s. Consequently, it changed the top management completely at the beginning of 1994, installing a group of managers from outside the airline industry, headed by Dr. Ahmed Kellow as chief executive.

The new group implemented cost-cutting measures that enabled it to announce a fiscal 1993-94 net profit four times higher than for the previous 12-month period, and for the 1994-95 fiscal, a profit equivalent to $30 million was almost triple the 1993-94 figure. …

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