The Senate select Committee established in May to probe into the activities of the Kenya airways - following concerns that the airline was being ran down- has released a report.
See:Senate To Probe Kenya Airways Operations
According to the 11 member committee, led by Kisumu senator Anyang Nyong’o, the following are the major problems that have rocked the national carrier.
- Poor investment decisions by management of buying and leasing air-crafts, and fuel hedging, under arrangements which are not profitable to the company, thereby leading to sky rocketing indebtedness.
- Expensive ticketing which is non-competitive in the market leading to loss of passengers as well as revenue.
- Routing arrangements and partnerships which may account for massive losses of revenue, particularly due to lack of expansion of KQ flights in the African routes.
- Problematic human resources policy and practices causing long drawn industrial unrest detrimental to establishing a healthy business environment in the company.
- Frequent cancellation of flights causing inconveniences and poor relationship with passengers, who consequently abandon using the airline.
The Committee will continue to discuss these issues with KQ management, shareholders and other stakeholders, believing that the Flag Carrier can be turned around, the Standard reports.
The report comes in the wake of a shocking financial report that indicated a 25.7 billion after tax loss, incurred by Kenya airways during the last financial year.
However, according to the airline management the fall of the tourism industry in the country, following terror attacks and the issuance of travel advisories by most countries was among the biggest blows to Kenya Airways.
See: Tougher Days for Kenya Airways As it Posts New Record Loss of Sh25.7 billion.
The flag carrier further said part of the loss was as a result of stiff competition from Middle East carriers and high operating costs.
The 661% drop from last year’s loss of Sh3.3 billion sparked a storm, with various stake holders calling on urgent action to save the crippling airline.
