Vule Airways set to take off at Entebbe International Airport

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Vule comes at the time Kenya Airway’s low-cost subsidiary, Jambojet, which posted a US$1.26 million profit in its second year of operation underlining increased use of domestic air travel last year, has set a December target for unveiling international operations on 11 new routes subject to regulatory approvals following acquisition of a new aircraft from a Moscow-based leasing company as part of its expansion.

Jambojet has applied to fly to Dar es Salaam, Zanzibar, and Kilimanjaro in Tanzania, Blantyre and Lilongwe in Malawi as well as to Uganda, Ethiopia, Somalia, and the Democratic Republic of Congo.

The low-cost carrier leased a 78-seater Bombardier Q400 from Ilyushin Finance Co (IFC) to serve its domestic customers and the upcoming routes, with a second aircraft scheduled for delivery in November.

Currently, Jambojet flies to six routes in Kenya; from Nairobi to Mombasa, Eldoret, Kisumu, Lamu, Malindi and Ukunda.

Meanwhile, the first entrant in the low-cost flight business in the region, Fastjet, recorded a net loss of US$48 million for the year ended December 2016, more than doubling the $21.9 million loss recorded the previous year. The Tanzania–based, London-listed low-cost carrier with pan-African ambitions, has air operator’s certificates in two countries—Tanzania and Zimbabwe—which are seen to be facing tough economic conditions and increased competition, as the two airlines themselves battle to right-size to the market.

In December last year, the carrier suspended its flights to Jomo Kenyatta International Airport, Nairobi, Kenya and Entebbe in Uganda barely a year after launching the routes.

The low-cost carrier also stopped flights from Johannesburg to Victoria Falls in Zimbabwe citing low passenger numbers as well as inefficient utilization of the carriers existing fleets.

The carrier was said to be only one in the region using the Airbus on domestic routes as its competitors Kenya Airways, Precision Air, Air Tanzania and RwandAir use the Embraer 190, Bombadier, ATR and Dash 8 series respectively.

Vule’s aggressive model

Vule Airways officials say they have their own aggressive model and projects to make minimal loses of US$378,000 in 2017/18, US$413,000 in 2018/19 and US$ 652,000 in 2019/20. The company would break-even in 2020/21 with a profit of US$ 810,000, US$1.611million in 2021/22 and US$2.079million in the 2022/23.

Exporters are looking at Vule’s model as a blessing to their businesses.

“We believe that the entry of the new carrier will give us some bargaining power leading to a reduction in freight costs,” James Kanyije, the chief executive officer of KK foods, a local fresh food company that exports to European markets said.

Kanyije said that current freight costs are very high, accounting for 76% of their total business expenditure.

Stephen Asiimwe, the chief executive officer at the Uganda Tourism Board (UTB) says they will only ascertain the impact of the new carrier once it has been granted operating licence and analysed the planned routes.

Who are the people behind Vule Airways?

Robert Mwesigwa: Is the Chairman and current Managing Director of Vule Airways that was founded in March 2017. He is a Soviet trained Aeronautical Engineer with a Master of Science degree in aeronautical engineering specializing in aircraft construction and exploitation and in unmanned aerial vehicles. His degree thesis was on identifying the most suitable medium range aircraft for Uganda’s Entebbe-London route.

He was the Executive Director of the East African Community regional safety oversight organisation (RSOO) – Civil Aviation Safety and Security Oversight Agency (CASSOA) from March 2015 – May 2017, having been one of its pioneer staff in 2007 as the Technical Coordinator.

He has served in different portfolios in the aviation industry since 1994, some of which are Uganda Airlines where he was a planning engineer and East African Airlines, in which he was key in its establishment and operations.

On the social responsibility aspect he is a member of the Buganda Kingdom Parliament, the Great Buganda Lukiiko, and the Treasurer of Namirembe Cathedral, the main Anglican Cathedral in Uganda.

 Fred Keays: He is a British national and a director of Vule Airways.

Justice (Rtd) Lameck Nsubuga Mukasa: Justice (Rtd) Lameck Nsubuga Mukasa, the Company Secretary who began his legal career in 1978 retired as a Judge in September 2015 and is now chambering with Central Alternative Dispute Resolution & Advocates as Mediator and Legal Consultant. He served as a Judge of the High Court of Uganda and was deployed to the Criminal Court Division of the High Court as Head of Division and Senior Judge. He also served as Principal Judge in acting capacity whenever the Substantive Principal Judge was absent.

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