Business Profiles

Ethiopian Airlines: Back in the air

Recently in the news in connection with a tragic accident, Ethiopian Airlines are nevertheless continuing to pursue the glowing Vision 2025 plan that they set for themselves in 2010. Affected but not defeated, Ethiopian are here to show that they are as notable and reliable an airline as ever; we connected with the African carrier to see how they have been since the events in March, and to catch up on their exciting ongoing plans for the future.

Ethiopian Airlines (Ethiopian) is a long-established African airline, and yet, still one of the fastest growing. The aviation company has been in operation for over 70 years, and in that time, it has become one of the continent’s leading carriers, unrivaled in efficiency and operational success. The Ethiopian Airlines Group is the largest aviation group in Africa, a SKYTRAX certified four-star global airline. It has long held a reputation for efficiency and, above all else, safety, so seeing its name in connection with the recent fatal crash was a shock in the Endeavour office, as it was to many.

The pan-African carrier works in close collaboration with a number of entities, providing passenger and cargo services across the globe to more than 119 destinations. The organisations it works with include not only other airlines and businesses, but governments and NGOs. These connections are testaments to the high esteem that the airline is held in. Its March tragedy was therefore a surprise to many, and before exploring what the future holds for this company, we of course have to touch upon what happened.

On March 10th, an Ethiopian Airlines flight crashed only six minutes after take-off from Addis Ababa, the Ethiopian capital, in clear weather conditions. Tragically, all 157 people aboard the Boeing 737 MAX 8 were killed. Following the accident, a thorough investigation into the incident was undertaken, including the flight’s black box being sent to Paris for analysis, as well as evidence being gathered from the Flight Data Recorder (FDR), Cockpit Voice Recorder (CVR) and the crash site itself. There were questions into whether the fault lay with the airline or the training of their crew members, even though Ethiopian has always been highly regarded for its state-of-the-art flight training programs. However, investigations soon found that the fault lay not with the airline, but with an error within the Boeing 737 MAX 8’s sensors. According to the investigation, the aircraft passed an airworthiness test before take-off, all of the crew were properly trained and licensed to operate the flight, Boeing’s recommended procedures were followed and take-off was normal.

So what went wrong? Boeing, and the company’s president, chairman and CEO Dennis Muilenberg, have issued statements admitting to a technical fault on their part. It was found that the aircraft’s Maneuvering Characteristics Augmentation System, also known as MCAS, activated in response to incorrect Angle of Attack information. It appears that Ethiopian flight’s staff had already turned off the anti-stall software that was being activated by this error once, but the software re-engaged four more times – all of this within the first six minutes of flight.

Despite Boeing admitting that the fault is theirs, Ethiopian is still issuing compensation to the families who lost loved ones in the crash. Meanwhile, all Boeing 737 MAXs were grounded during the investigation, and the company has now addressed the error. Muilenberg told a conference in Dallas, Texas that Boeing has conducted 96 test flights of the modified 737 MAX and that their pilots have taken part in more than 159 hours of tests, which all results in the improved Boeing operating as it should.

Even though the issue has been owned and amended by Boeing, could this incident affect Ethiopian’s reputation? It seems to still stand true; later in March, the Group received the African Champion of the Year Award at the CEO forum event held in Kigali, showing the high esteem that the airline is still held in, and deservedly so. Other recent acknowledgements have included Tewolde’s induction into the African CEO’s Hall of Fame during the African Leadership Magazine’s Persons of the Year ceremony, and acknowledgement received from the global civil society, Most Influential People of African Descent.

Whilst deeply affected, including the loss of personnel, the company has not let this incident dishearten its ambition, nor its commitment to the standards that have previously set it apart and ahead in the continent. The flawed Boeings removed, the rest of Ethiopian’s fleet is the best that Africa has to offer, boasting aircraft that Tewolde described as “ultra-modern and environmentally friendly”, such as Airbus A350, Boeing 787-8, Boeing 787-9, Boeing 777-300ER, Boeing 777-200LR, Boeing 777-200 Freighter, and the Bombardier Q-400 double cabin. This modern fleet is kept young, with the average age of aircraft coming in at five years. Not only is it young, but it was first-wave, as Ethiopian was the first airline in Africa to operate any of these aircraft.

Ethiopian is still growing. In fact, over the past seven years, the airline has averaged growth of 25% a year. It knows that it has the assets and capabilities in place to keep reaching for the next goal; already, the airline commands a powerful segment of the Pan-African passenger and cargo network to more than 119 international passenger and cargo destinations across five continents. It is adding new destinations to its roster, including Turkey and new stops in the USA. Tewolde shows no thoughts to stopping; “We still have huge potential and opportunity to grow, and we are going to continue that growth.”

As a Group, Ethiopian is currently working towards its Vision 2025 plan, a 15-year strategy that began in 2010. This plan seeks to promote Ethiopian as the African leader in not only its airline, but all six of its business centres: Ethiopian International Services; Ethiopian Cargo & Logistics Services; Ethiopian MRO Services; Ethiopian Aviation Academy; Ethiopian ADD Hub Ground Services and Ethiopian Airports Services. Many of these are already enjoying continent-wide success. For example, Ethiopian Cargo & Logistics Services is Africa’s largest cargo operator, and was recently awarded ‘African Cargo Airline of the Year’ and ‘Air Cargo Brand of the Year in Africa’ for the fourth year in a row at the STAT Times International Awards for Excellence in Air Cargo.

Of course, Ethiopian’s key asset continues to be its staff, and the Group knows it. Its Human Resources Development plan is one of the four major pillars of Vision 2025. Currently, the company employs over 16,000 people, and all of these staff require training in order to perform their roles to a standard of excellence. Much of this training takes place at the Ethiopian Aviation Academy. This Academy has operated since the 1960s and continues to be one of Ethiopian’s key business centres. The Group had continuously invested in the growth and efficiency of the Academy, meaning that today, it is the largest and most modern aviation academy in Africa. Its size allows it to process 4,000 trainees a year, covering all of the essential skill areas in aviation.

Over only the last few years, the Group has invested over $100 million in the Academy, and its development continues: “We aim to multiply trained aviation professionals across the African continent. Our state-of-the-art aviation academy has been built to great the best African aviators for Africa. We invite all to come, learn and become an aviation expert.” Amongst the Academy’s recent graduates have been 20 cabin crew trainees from Mozambique, who will work in the newly opened Ethiopian-Mozambique airline.

In addition to training aviation skills to new and developing personnel in its Academy, both to future members of staff and individuals who will work elsewhere, Ethiopian Airlines also places great importance on training its staff for managerial positions, and promotes from within wherever possible. Tewolde himself has been with the company for 34 years, and assumed his current position in 2011. Before then, he worked his way up through the company:

“Since I joined Ethiopian Airlines in 1985, I have served in different capacities in the cargo traffic handling department and progressed up the ladder to Manager Cargo Traffic Handling. I also worked as Regional Director for India and South East Asia based in Bombay and later on transferred to Jeddah as Area Manager for Saudi Arabia. When Ethiopian Airlines commenced direct services to the USA, I was appointed as Area Sales Manager for North East USA and Canada based in New York. After that, I served as Executive Officer Marketing & Sales, and Chief Operating Officer before assuming my current position as Group CEO.”

Tewolde’s career is a perfect example of the progression possible within the Group, for staff who are dedicated and want to learn. Both regarding employee careers and the overall success of the airline and Group, Tewolde feels that the heart is clear: “I believe that hard work lies at the heart of success. There is no substitute or short cut to success other than working hard to achieve your goals.”

Of course, for a team to work hard and flourish, it also requires strong support and effective leadership. As GCEO, the latter now falls to Tewolde himself, and the management teams working with him:

“Effective leadership is all about motivating and rallying a team towards a clearly defined vision. At Ethiopian, we have been setting ambitious visions (Vision 2010 and Vision 2025) which have propelled the airline towards remarkable growth, making it the leading aviation group in Africa. To ensure staff engagement, the airline’s management communicates the set targets to staff and employs different approaches to motivate employees to contribute their share in meeting the goals.” The continued training and support also helps to incentivise staff, as does the aforementioned progressive promotion opportunities within the Group.

This highly motivated and well-trained team faces many challenges, however. Operating an aviation group contains a vast range of logistical issues, but on top of that, the industry is also going through a difficult period. According to the International Air Transport Association, African carriers are predicted to report a $300 million net loss in 2019. This is a slight improvement on the $400 million net loss in 2018, but is a sign that business is still challenging. However, whilst many airlines in the continent are losing funds, Ethiopian’s efficiency, long-standing partnerships and experienced approach to its operations means that it is not.

Part of the cause for these losses is that aviation operations have become more expensive in Africa than they are elsewhere in the world, including high jet fuel price, ground handling costs, taxes and airport charges. On top of these challenges, restrictions in some African countries mean that Ethiopian is not able to expand as it would like. Furthermore, the Single African Air Transport Market initiative is still in its development stages. “SAATM, the AU initiative of eventually creating a single African air transport market, is making headway but a lot needs to be done.”

However, Tewolde continues to be confident in Ethiopian’s vision and its systems. As he proudly told us, “We continue in 2019 with our Vision 2025 fast, profitable and sustainable growth strategy. As a pan African airline, we are committed to serve the continent in good times and bad. We shall support and play our part for the growth of African air transport by collaborating with African governments and airlines.” With 70 years’ experience behind it, and a team of “avid and experienced industry experts” running the airline, there is little that could ground Ethiopian. They continue to be as dedicated to their high standards as ever, and are moving forwards with the ambition and confidence earned by seven decades of dedication.

About the author

Alice Instone-Brewer

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