Contrary to many of its regional and global counterparts, Ethiopian Airlines claims it has dealt with the crisis without reducing salaries or asking the government for a bailout, though reports in April suggested that some staff have been furloughed without pay. The airline has pivoted to a vital income stream – the transportation of cargo. CEO Tewolde Gebremariam says that Ethiopian Airlines’ earlier decision to diversify its revenue model has helped to avert financial ruin by allowing the airline to maintain half of its income while 90% of its passenger fleet is currently grounded. The ability to pivot into the cargo business is possible thanks to the airline’s prolonged investment in the sector, which led to the creation of Africa’s largest and most advanced cargo hub in Addis Ababa. The decision was taken in March to shift from “growth mode to survival mode”, according to the CEO, leading to the reallocation of capital and resources away from its passenger business. Building on its cargo fleet of 10 Boeing 777s and two Boeing 737s, Ethiopian Airlines also converted 25 passenger aircraft into cargo planes.
SOURCE: AFRICAN BUSINESS MAGAZINE
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