Cape Town - The national airline of the Republic of Seychelles, Air Seychelles has announced a strategic transformation plan to ensure the long-term profitability and sustainability of the airline.
Part of the plan is to consolidate its international network by suspending the Paris and Antananarivo (Madagascar) routes from 24 April 2018 and exit the two leased Airbus A330 aircraft out of the fleet.
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The airline says it will also replace its regional fleet of two Airbus A320 aircraft with the next generation aircraft in 2019, increasing seat capacities and reducing operational costs.
Competition in air travel
According to the airline, the plan, aimed at responding to rapidly increasing competition in the air travel sector, was approved by Air Seychelles’ Supervisory Board and both shareholders, the Government of the Republic of Seychelles and Etihad Airways.
Jean Weeling-Lee, Chairman of Air Seychelles, says the aviation industry is fiercely competitive and will become even more so in 2018 as some of the largest carriers begin flying to Seychelles.
"This transformation plan has been designed to restructure the Air Seychelles business to meet the challenges of the future while continuing to deliver strong results for the economy and people of Seychelles,” says Weeling-Lee.
Some of these said largest carriers include airlines already operating to Seychelles such as Turkish Airlines, Qatar Airways, Emirates Airlines, Etihad Airways, Kenya Airways, Ethiopian Airlines, Austrian Airways, Sri Lankan and Condor.
In September 2017, British Airways announced plans to launch flights from London to Seychelles in March, followed by Air France introducing services from Paris in May and the Swiss Edelweiss Air launching flights from Zurich in September 2018.
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The airline says the competition creates "overcapacity on Seychelles-bound services from Europe".
By suspending the routes, the airline says "this will create significant downward pressure on airfares and negatively affect the loads and forward bookings on Air Seychelles’ current three-per-week Paris operation."
All passengers scheduled to fly on the Paris and Antananarivo routes beyond 24 April will be re-accommodated on other flights and will be notified of the changes to their itineraries, says Air Seychelles.
“The launch of competing [for] air services from Europe to Seychelles will significantly impact Air Seychelles’ flights to and from Paris, which account for approximately 30% of total passenger revenue at the airline, making the route unsustainable in the long-term," says Remco Althuis, Interim Chief Executive Officer of Air Seychelles.
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Althuis says after considering all the options, the airline took the decision to withdraw from both Paris and Antananarivo and refocus on its core strengths, which is domestic and regional networks.
"Doing so will enable us to concentrate on more profitable areas of the business, while people in Seychelles will continue to have non-stop access to France and wider Europe through airlines that can operate at more efficient international scale than Air Seychelles,” he says.
In addition to this, the airline says it will concentrate on developing its domestic operations, including inter-island flights between Mahé and Praslin, scenic flight packages and island charters, which are set to play an increasingly important role as more international travellers visit the archipelago.
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'Creole spirit and exceptional service'
Althuis says the key differentiator of Air Seychelles has always been its creole spirit and exceptional service, and it will explore ways of building on this foundation while developing its offering to better meet the needs of modern travellers, who are increasingly looking for a more personalised travel experience.
"Our goal will be to restructure our cost base while retaining all the standout qualities that make Air Seychelles so unique,” he says.
This refocusing of the business, according to the airline, will include a reduced workforce in cabin crew and pilots, as well as supporting flight and commercial roles.
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Air Seychelles says it will provide compensatory packages to affected staff as well as support with job searches and employment.
“We fully understand how challenging these changes will be and we are establishing the optimum way of dealing with the transition," says Althuis, adding that the airline management team will be working closely with the Supervisory Board, Etihad Airways and the Government of Seychelles to preserve as many jobs as possible and provide assistance to staff.
"Resizing the workforce to our changing business requirements is a necessary step to create a lean and efficient company,” he adds.
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Maurice Loustau-Lalanne, Seychelles' Minister for Tourism, Civil Aviation, Ports and Marine says as an island nation they have always risen to the challenges placed before it by international economic forces.
“I am confident that, with the full support of its stakeholders, our flag carrier will adapt to the winds of change. It is important that we take these tough but necessary steps at this time to safeguard the future of Air Seychelles,” says Loustau-Lalanne.
Robin Kamark, Chief Executive Officer Equity Partners, Etihad Aviation Group, says the airline will continue to stand alongside the Air Seychelles as it undergoes this crucial transformation.
"This strategic business plan has been developed to reflect the realities of the market today and place Air Seychelles in a strong position for further growth,” says Kamark.
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