Originally Posted by
nanyang
Interesting thoughts there. I would think it's pretty important for any airline to try and sell fares that make them money on average.
Some challenges that might impact costs in some jurisdictions in Africa:
- Small markets, low volumes (low disposable incomes, so cannot stimulate demand via lower fares)
- Fuel costs? State monopoly in various markets?
- Difficulty of repatriating funds from various countries
- I assume typically airport fees and charges are high
- Salaries are one thing, but how about labour productivity?
- Security, insurance
- I would also assume local operations - sales, ground handling etc. - in various countries can be quite expensive (also considering low volumes)
Agreed - in effect it's a totally inefficient market.
KQ isn't alone in that - SAA is also a basket case. Poor management decisions by political appointees, corruption, too many free fares for ANC cronies and so on.