Air Tanzania

Air Tanzania

IATA TC ICAO ATC Callsign TANZANIA
Founded	1977
Hubs	Julius Nyerere International Airport
Fleet size	4
Destinations
Company slogan	Wings of Kilimanjaro
Parent company	Government of Tanzania
Headquarters	ATC House Dar es Salaam Tanzania
Key people	Paul Chizi MD and CEO
Website	Homepage

Logo of Air Tanzania Corporation

Air Tanzania is the national airline of Tanzania. Its main base is Julius Nyerere International Airport, Dar es Salaam.^[1]

History

An Air Tanzania Fokker F27-600 at Moi International Airport in 1986.

Air Tanzania Corporation was established on 10 March 1977 after the breakup of East African Airways, which had previously served the region. Flights were started from Dar-es-Salaam using Boeing 737-200s and Fokker F27s. A Twin Otter was used for regional services and flights from Kilimanjaro were started. In the mid-1990s, the airline leased an Ethiopian Airlines Boeing 767 but this aircraft was too large and the airline disposed of it. Regional services were reduced in this period and the Twin Otter was also disposed of.

Privatization

The airline was originally wholly owned by the Government of Tanzania via the Air Tanzania Corporation (ATC). In February 2002, the government began the process of privatizing ATC through the Presidential Parastatal Sector Reform Commission (PSRC). Advertisements were placed in the local, regional and international media inviting potential bidders. The International Finance Corporation (IFC) acted as the Lead Advisor to the Government in this transaction.^[2][3]

The government had approved a transaction structure which included:^[4]

• Creation of a new company, Air Tanzania Company Limited (ATCL), which would be incorporated as a limited liability company, under the Companies Act to take over the operating assets, and specified rights and liabilities of ATC.
• A second new company Air Tanzania Holding Company (ATHCO) would be created to take over the non-operating assets and all other liabilities of ATC.

The following eight airlines submitted Expressions of Interest:^[4]

• Aero Asia International (Pakistan)
• Air Consult International (Ireland)
• Comair (South Africa)
• Gulf Air Falcon (United Arab Emirates)
• Kenya Airways
• Nationwide Airlines (South Africa)
• Precision Air (Tanzania)
• South African Airways

Of the eight, four airlines carried out due diligence – South African Airways, Kenya Airways, Comair and Nationwide. On 19 September 2002 – bid deadline date, only SAA submitted a bid. Kenya Airways and Nationwide informed the Government that they do not intend to submit bids.^[3]

ATC-SAA partnership

The government selected South African Airways as the winning bidder. In December 2002, SAA after signing an agreement with the government purchased a 49% stake in ATC for USD 20 million; USD 10 million as the value of the shares and the remaining USD 10 million for the Capital and Training Account for financing its proposed business plan.^[3]

As the strategic partner, SAA planned to create its East African hub in Dar es Salaam to form a “Golden Triangle” between Southern, Eastern and Western Africa. It also intended to replace ATC's fleet with Boeing 737-800s, 737-200s and 767-300s. It also planned to introduce regional routes, routes to the Middle East and West Africa. The government was expected to sell 10% of its current 51% stake to a private Tanzanian investor, thereby reducing the government's ownership to a non-controlling interest in ATCL.^[5]

The new airline Air Tanzania Company Limited (ATCL) was launched on 31 March 2003, offering direct flights from 1 April between Johannesburg and Dar Es Salaam, but also to Zanzibar and Kilimanjaro.

Air Tanzania recorded a pre-tax loss of almost USD 7.3 million in its first year following privatisation and part ownership by South African Airways. The loss was mainly attributed to the inability to expand the network as quickly and extensively as originally planned. It had been hoped to launch services to Dubai, India and Europe, but these have been delayed as there are only Boeing 737-200s in the fleet. The development of Dar Es Salaam as an East African hub for the South African Airways alliance had also not proceeded as quickly as planned.^[6]

On 31 January 2005, Air Tanzania suspended one of its few regional services: Dar es Salaam to Nairobi, following intense competition from Kenya Airways on the route. The airline did however reaffirm intentions to launch long-haul services within a year from Dar es Salaam to Dubai, London, Mumbai and Muscat.^[7]

Termination of contract

On 31 March 2006, the Government of Tanzania announced that it would dispose of Air Tanzania Company Limited (ATCL) following the four years of loss-making which amounted to TZS 24.7 billion. The Tanzania Civil Aviation Authority Director General said "Air Tanzania was in a worse state than before it was taken over by SAA". South African Airways blamed Tanzania's government for failing to release about USD 30 m needed to implement Air Tanzania's business strategy to reverse continued losses.

On 7 September 2006, the Tanzanian government bought back the 49% stake in ATCL for USD 1 million, hence officially terminating its partnership with South African Airways. The venture collapsed due to the partners' different interests in the business.^[8]

Revamped ATCL

After the partnership between Air Tanzania and South African Airways was officially terminated, the government took the initiative of setting aside TZS 13 billion for: completing operation code ATCL 197 instead of 083, changing revenue systems and fuel services, preparing e-ticketing and accounts systems, using a new trademark, and clearing outstanding debts.^[9]

President Jakaya Kikwete appointed Mustafa Nyang`anyi, a veteran politician and diplomat Ambassador as the Board Chairman and former Parastatal Pensions Fund Director General, David Mattaka as Managing Director and Chief Executive Officer.^[10]

From 1 July 2007, ATCL started using its own tickets, Number 197, recognized by the International Air Transport Association (IATA). The airline had been using a South African ticket stock, Number 083, during the partnership with South African Airways. The airline also started using electronic ticketing in compliance with the IATA resolution from mid July.^[11]

The Parliamentary Committee on Economic Infrastructure expressed its concern about no funds being set aside for ATCL. According to the opposition, the airline has debts amounting to USD 4 million due to South African Airways.^[12]

A Member of the Tanzanian Parliament asked the government to claim compensation from South African Airways for taking aircraft spare parts from the Air Tanzania hangar at the Kilimanjaro International Airport to South Africa.^[9]

In August 2007, Air Tanzania selected the Revenue Accounting Bureau Service offered by Mercator, the airline IT solutions provider of the Emirates Airline Group. Once implemented, it will offer benefits such as: enhanced revenue through accurate billing and verification, lowered accounting costs, raised productivity and eliminated training costs.^[13]

Air Tanzania was relaunched in September 2007 after the dissolution of the partnership with South African Airways. The new brand represents the company's name, Mount Kilimanjaro and the airline's international destinations. The introduction of the airline's new logo bears the image of the imposing giraffe – Tanzania's national icon, to replace the South African Airways flag symbol.^[14][15]

On 1 October 2007, the revamped Air Tanzania made its inaugural flight on the Dar es Salaam to Mwanza via Kilimanjaro route.^[16]

Temporary suspension of service

In December 2008, the Tanzania Civil Aviation Authority, (TCAA) withdrew the Air Opearator Certificate for Air Tanzania for reasons accruing to mainly unsatisfactory safety and operational manuals.^[17] In the same month, Air Tanzania decided to voluntarily resign from IATA membership in order to preserve its status while preparing for the IOSA audit which is a prerequisite for all member airlines. The company was granted the Air Operator Cerificate by TCAA two weeks later and is now in an a process to return to IATA membership which has taken long because of preparations for the audit.^[18]

As of 18 March 2011, Air Tanzania Corporation Limited has effectively been grounded after its sole remaining operational aircraft, a was sent for extensive maintenance to South Africa. Destinations previously served by Air Tanzania are expected to be taken over by Precision Air and Fly 540.^[19]

Performance 2010

In July 2010, it was reported that in 2009 Air Tanzania flew 60,018 passengers, while during the same time the main competitor Precision Air moved 583,000 passengers, and Coastal Aviation 141,995 passengers.^[20] This makes Air Tanzania currently the third largest carrier in Tanzania. As reporting Tanzanian officials report that there will be collaboration with airline itself as by next year it is stated that he airline will change name and logo to 'FlyTanzania'.

New alliances

Press reports out of East Africa in July 2010 indicate that Air Tanzania is in serious discussions with Air Zimbabwe to establish extensive and substantive management collaborative arrangements. Both airlines are reported to be in search of strategic partner(s) to shore up their operations which have been in decline over the past decade.^[21]

Financial performance

Resumption of service

In November 2011, East African media reported the resumption of service by ACTL, following the return of one Bombardier Q300 from extensive service in South Africa. The servicing cost was US$1 million, but other accumulated expenses brought the total bill to US$3 million, which the Government of Tanzania paid in September 2011. A second Bombardier Q300 will undergo service maintenance, in Tanzania, over the next eight weeks at an estimated cost of US$250,000 and will re-enter service in early 2012. ACTL will in the meantime lease a Fokker 28 aircraft from JetLink Express on a standby basis, in case their only operational airplane is incapacitated. More aircraft will be procured over the next several months and years, according to the airline's business plan, shared with the media.^[22] Air Tanzania codeshares with Air Uganda and Air Zimbabwe.

On 21 November 2011, Air Tanzania began negotiations with Export Development Canada (EDC), to explore ways in which EDC can assist ACTL to acquire more aircrraft from Bombardier, a Canadian airplane manufacturer. ACTL has plans of increasing its fleet size to 11 aircraft within the next five years.^[23] ].

O 29 March 2012. Source: Aerovista News. AEROVISTA will be leasing its B737-500 for Air Tanzania and will be sourcing more aircrafts depending upon the requirements in future. Aerovista is an airline based in Sharja, United Arab Emirates and has a fleet of nine aircrafts.The acquisition of the plane was a short-term plan to enhance the firm’s service delivery, adding that the airline has a long-term plan that will be implemented accordingly].

Destinations

As of November 2011^[update] Air Tanzania flies to the following destinations:^[24]

• Tanzania
  • Dar es Salaam - Dar es Salaam International Airport - Main Hub
  • Kigoma - Kigoma Airport
  • Tabora - Tabora Airport
  • Arusha - Arusha Airport
  • Kilimanjaro - Kilimanjaro International Airport
  • Zanzibar - Zanzibar International Airport

Fleet

The Air Tanzania fleet included the following aircraft (as of November 2011):^[25]

Accidents and incidents

• On 1 March 2010, Flight 100, operated by Boeing 737-200 5H-MVZ sustained substantial damage when it departed the runway on landing at Mwanza Airport and the nosewheel collapsed. Damage was also caused to an engine.^[27]

• 9 April 2012: A de Havilland Canada DHC-8-311Q, tail number 5H-MWG, the aircraft overran runway 34 in Kigoma Airport in Tanzania after the crew attempted to abort the takeoff. The four crew and 31 passengers were not injured. The aircraft was written off (Beyond repair).^[28]

References

External links

	Tanzania portal
	Aviation portal

Media related to Air Tanzania at Wikimedia Commons

• Official Website
• Air Tanzania Fleet
• Air Tanzania history
• Air Tanzania Resumes Service