Tanzanian government officials led by Prime Minister Kassim Majaliwa receive Air Tanzania’s latest aircraft, a Boeing 737 MAX 9 at Julius Nyerere International Airport in Dar es Salaam, Tanzania on March 26, 2024. PHOTO | POOL
Air Tanzania this week added a second Boeing 737 MAX 9 jet to its fleet to signal its strong expansion plan even as a government audit confirmed a sixth straight loss-making year for the national carrier.
According to the Controller and Auditor General (CAG)'s 2022/2023 report presented to President Samia Suluhu Hassan in Dodoma on Thursday, Air Tanzania posted a Tsh56.6 billion ($22.19 million) loss for the year, the fifth highest among public companies and about 32 percent above the $15.17 million loss registered in 2021/2022 financial year.
The new plane's arrival at the Julius Nyerere International Airport in Dar es Salaam on March 26 raised the airline's fleet to 15 as it continues to pursue an ambitious, government-sponsored revival programme that has so far cost nearly Tsh4 trillion ($1.57 billion), according to official Air Tanzania records.
But, aside from the latest report of Air Tanzania's losses, the event was also notable against backdrop of safety concerns that have recently emerged over the 737 MAX 9 model, placing Boeing under intense scrutiny and the company's CEO’s job on the line.
Air Tanzania was the first African airline to purchase Boeing's 737 MAX 9 model, placing its order for both planes at the Dubai Air Show in November 2021 and taking delivery of the first plane in October 2023.
This was long before problems associated with that particular model surfaced in January this year when the door plug of an Alaska Airlines Boeing 737 9 MAX blew off mid-air, leaving a large hole in its fuselage, shortly after take-off from Portland, Oregon en route to California with 177 people on board.
No one was injured in the incident, but the US Federal Aviation Administration opened an investigation, halting further production of the aircraft for the time being and grounding hundreds of models fitted with the door plug feature pending thorough inspections and safety checks.
It is understood that the grounded MAX 9s have since been cleared to return to service. But Boeing has continued to face pressure from US aviation regulators over safety issues and quality control problems at its main manufacturing plant in Seattle.
The company this week confirmed that CEO Dave Calhoun would step down by the end of the year as a result of the fallout from the January 5 incident.
Air Tanzania, meanwhile said it intended to make full use of both planes, which cost between $129 million and $135 million each, and can cover at least 3,000 nautical miles with a 220-passenger capacity in the medium-haul category, as part of its revival strategy that was initiated by former president John Magufuli in 2016 and has been maintained by President Samia's administration.
Its current stable comprises two 737- MAX 9s, two Boeing 787-8 Dreamliners, four Airbus A220-300s, five De Havilland Dash 8 Q400s, one De Havilland Dash 8-Q300 and one Boeing 767-300F Freighter. Categorised as a medium-haul aircraft, the 737 MAX-9 has been on Boeing's production line since 2017 using a LEAP-1B engine manufactured by US firm CFM International.
The global travel news outlet Skift describes the MAX 9 as "one of the least popular versions" in the 737 MAX family, but notes that prominent carriers like United Airlines and Alaska Airlines operate a significant number.
The two US-based airlines own about two-thirds of the 215 models of the plane that were in service worldwide by the beginning of 2024, according to a breakdown published by Skift.
Other carriers that have it include Copa Airlines (Panama), Aeromexico, Turkish Airlines, SCAT (Kazakhstan), Icelandair, Lion Air (Indonesia) and Flydubai.
ATCL planes are owned by the state-run Tanzania Government Flight Agency (TGFA), which oversees all purchases, and Air Tanzania operates them under a strict lease arrangement that the airline has in the past criticised as detrimental to its chances of doing profitable business.
Annual CAG reports have shown that Air Tanzania has consistently operated at a loss for several years, topping the list of public companies in this category in the 2021/2022 audit despite posting consecutive drops in losses from $25.97 million in 2019/2020 to $15.17 million.
According to the CAG report, the latest Air Tanzania losses were incurred despite receiving another Tsh31.55 billion ($12.37 million) government support during the year under review. The report also noted that that a government-appointed team was currently reviewing the airline’s technical, financial and operational performance and will subsequently submit recommendations on ways to stem the losses.
It did not say when the assessment is expected to be concluded.
The latest report shows that its losses for 2022/2023 were only trumped by the National Health Insurance Fund at Tsh156.7 billion ($61.45 million), TIB Development Bank at Tsh131.07 billion ($51.4 million), Tanzania Railways Corporation at Tsh100.7 billion ($39.49 million) and the Tanzania National Oil company (Tanoil) at Tsh76.5 billion ($30 million).
But speaking at Tuesday's plane reception ceremony at JNIA, Air Tanzania Company Ltd managing director Ladislaus Matindi sought to paint a rosy picture of the carrier’s future, outlining plans to introduce new destinations such as Dubai, Muscat, Lagos, Kinshasa, Goma, Juba and London to its international routes network, while also resuming trips to Johannesburg. The four-times-a-week Dubai flights were scheduled to begin on March 31.
Other international routes that Air Tanzania plies are Guangzhou, Mumbai, Nairobi, Entebbe, Bujumbura, Lubumbashi, Ndola, Comoros and Harare.
The airline also operating 15 domestic routes. Mr Matindi said Air Tanzania planned to have a fleet of at least 20 aircraft by mid-2027 under its current strategic plan, with another long-haul plane, a Dreamliner 787-8, expected to be in April.
Prime Minister Kassim Majaliwa, who led government officials in receiving the new plane, called on the airline to do proper market research on potential new destinations.
He outlined government plans to add a dedicated terminal at JNIA for Air Tanzania flights as part of support measures to make the airline more competitive, but also urged it to seriously address public concerns over frequent delays of its domestic flights that have somewhat tainted its reputation for reliability.
