Africa is often referred to as the last place for commercial aviation to exploit. Rich in resources, but poor in economics and politics, much of Africa is flown over. But this is changing as communications technology reaches everywhere, and people want access to the global economy and its promise of a better life, with improved health and modern lifestyle choices.
What does Africa’s commercial aviation look like? In terms of its aviation fleet size, the area is not well served. Its ratio of population to commercial aircraft actually isn’t too bad – but the areas that benefit are not widespread. The table compares Africa with some markets. Population numbers come from the CIA Fact Book.The following charts are based on fleet data from Jet Information Services. Note data on turboprops starts with 2009. Nonetheless, proportionally turboprops and regional jets have seen the most growth in recently. This is surely a sign of developing commercial aviation reaching into smaller markets and developing traffic.
When we dig a bit deeper, and break out the fleet by OEM some interesting patterns emerge. First is the rapid growth Embraer and Bombardier are making in the market. From EJets in Kenya to Q400s in Ethiopia and Cote d’ Ivoire, the regional OEMs have established a new beachfront and are successfully invading the African marketplace.
|Cape Verde Republic||3||4||7|
|Central African Rep||4||4|
|Dem. Rep. of Congo||4||18||1||16||39|
|People’s Rep. of Congo||12||5||5||22|
|Sao Tome & Principe||6||6|
Comparing Africa with the rest of the world generates the following chart. It is clear the African market is quite different from the rest of the world in terms of OEM share. Boeing is the most established globally and maintains its share. Note that Airbus is significantly behind in Africa – this not necessarily a bad thing by the way, just interesting to see. Airbus has picked its markets carefully it seems. Bombardier and Embraer have been making good inroads in Africa and likely benefit from any fleet updates from the Other category before the bigger OEMs.
If we look across the continent to where OEMs have at least 10 aircraft in service, we can see how focused markets are. There are only 11 countries that have any concentration of aircraft – the number in the symbol represents the local OEM fleet. The chart illustrates the spread of the fleets by OEM across Africa. Only South Africa has sufficient traction for all the OEMs to appear.
The gaps on the map demonstrate that Africa is an area of opportunity. But this opportunity comes with many challenges. Africa leads the world in aviation accidents. It is also lacking in terms of infrastructure. As an example, take a look at the challenges Emirates highlighted in 2009 regarding operations over Africa. Since aviation has safety as its #1 priority, a lot of African infrastructure has to be developed. This means big political changes – less money for weapons and more for economic infrastructure. Without this there will be no growth or limited growth in GDP, which drives air travel demand.
Happily many African nations are seeing the benefits of democracy. But corruption is a sport played better by Africans than almost anywhere else. Change doesn’t come fast enough.
So what opportunities are there now? The following table lists the markets which account for 76% of Africa’s in-service fleet. Only two markets show an average fleet age under a decade. It is clear there is an opportunity to replace older aircraft.
Of the in-service fleet, there are 232 passenger aircraft over 20 years old plus 25 freighters 30 years or older. The average age by model is listed the table. There are 302 opportunities available to replace some seriously aging passenger aircraft. 215 are single aisle, 69 are turboprops and 18 are wide bodies. Not included among these old aircraft are another 11 BAe-146s that are aging fast.
Africa used to be the place that old airliners went at the end of their careers. Recently, we’ve seen new orders for turboprops and regional jets in markets that, ten years ago, would have found only used aircraft viable. The markets in Africa are maturing, and requiring new aircraft to replace older and less efficient models, just as in other regions.
The market opportunity in Africa is significant, but so are risks. The fiscal stability of government owned airlines is challenging (Air Zimbabwe for example). Africa has one of the worst safety records and vast areas with a lack of positive air traffic control or radar coverage. Finally, capital is scarce, making aircraft financing more risky given shaky airline balance sheets. But for those that persevere, an opportunity is significant, particularly with many of the older aircraft that could be replaced with turboprops or regional jets.
In summary, Africa is an area of opportunity, but in the short run these opportunities will be primarily in established markets. This is good because replacing older aircraft means doing business in established and credible markets. But in the longer term, the market will be rich with opportunities to market turboprops and regional jets to provide service to communities without air transportation and connect them to hubs. But this will take patience, as vendors cannot oversell into a market that lacks a reliable plan for infrastructural development.