in Air Transport / Features

Flying the flag for Uganda

Posted 30 April 2020 · Add Comment

Cornwell Muleya is no stranger to African aviation, after gaining senior leadership experience at Air Botswana, Air Tanzania, Air Mauritius and Zambezi Airlines. As Victoria Moores reports, his latest challenge has been setting up Uganda Airlines, an ambitious new national carrier, which launched operations in 2019 and plans to go long-haul in 2021.

Uganda Airlines CEO, Cornwell Muleya, originally trained as a chemical engineer. He may have ultimately chosen aviation over chemistry labs, but he still hopes to be a catalyst for change.
“At university, I read chemical engineering. I decided that wasn’t what I wanted to do, so I became a chartered accountant,” Muleya said. “I wanted a job where I could travel, so I thought accounting would give me that.”
Needless to say, his travel ambitions were more than met – but not quite as expected. Originally from Zambia, Muleya’s work with Deloitte & Touche and PricewaterhouseCoopers took him to several African countries – including Kenya and Tanzania – and ultimately into the aviation industry.
“I specialised in audit and then restructuring of companies,” he said. “That’s how I got into aviation. I was recruited as part of the team to restructure Air Botswana in 1995.”
After joining Air Botswana as head of finance, Muleya became CEO. He stayed eight years, until 2002, restructuring the airline and achieving profits in seven of those eight years.
His next stop was Tanzania. When South African Airways (SAA) bought into Air Tanzania in 2002, Muleya became the latter’s managing director, handling its restructuring and integration until early 2003.
After that, it was on to Air Mauritius, as CFO. “I was there for six years, until 2009.” At the time, Air Mauritius was also restructuring, shifting from a three-class full-service model to a two-class leisure carrier.
Then Muleya went back to Zambia for a year, to set up and launch independent start-up Zambezi Airlines, before moving on to Kenyan wet lease (ACMI) operator, Aircraft Leasing Services (ALS), on another restructuring project.
“From there, I was recruited by Aga Khan to go and restructure Air Uganda,” Muleya said.
Muleya joined Air Uganda in 2013, but one year later a decision was taken to close the airline. That process took until March 2015, but Muleya felt there was still a strong business case in Uganda.
“When I finished closing the airline, I decided we cannot remain without a carrier, so I started a project in 2015. I discussed it with the government and it became a government project.”
This project ultimately became Uganda Airlines.
Muleya performed a detailed feasibility study with the national planning authorities, before starting work on the final Uganda Airlines business plan in October 2017. The plan was signed off just three months later.
“The economy can’t do without the airline. It’s the biggest catalyst, in terms of attracting investment,” Muleya said. “Oil is supposed to start flowing in 2022, so there is a lot of investment to facilitate the development of the oil and gas sector.”
Uganda is landlocked, depending on air links for connectivity and to stimulate other sectors, like tourism, mining, oil and gas. The national carrier project had the potential to create direct jobs and to boost other sectors, with a knock-on effect on employment and on the government’s foreign exchange reserves.
“This is an industry of the future. You can’t afford to just sit on the sidelines and watch other people come in and take your market, which is what’s been happening since the last carrier was closed. It opens up all those opportunities,” Muleya said.
Uganda has a population of 40 million people and Entebbe Airport handles around 1.6 million passengers annually. “Some 60% of that is Uganda-derived traffic,” Muleya said.
“Over the next 10 years, traffic could double, so we’re talking 3.2 to 3.6 million travellers in the next 10 years. That’s the type of growth that we’re looking at. Currently, the average spend of those 1.6 million travellers is about $450 dollars per passenger, which is quite high, so we are talking about a market of half a billion dollars at the moment, which is set to grow.”
Uganda Airlines was incorporated as a company on January 30, 2018. Then the real work began, creating corporate structures, acquiring aircraft, getting them added to the national register and applying for an air operator’s certificate (AOC).
The government had originally planned to fund Uganda Airlines with a mix of debt and equity, but the search for debt-financing for the aircraft took too long, so the start-up was ultimately funded with government equity and no debt.
“Because of the timelines in getting those structures approved, the government decided ‘look the project is too important, let’s fund it from our own resources’. That’s where we lost almost nine months to a year, on the [finance] structuring.”
Then there was the issue of introducing the Bombardier CRJ900 as a new type on Uganda’s national register. “We had to get type certificate, so that meant everybody had to be trained, including the regulators,” Muleya explained.
After overcoming these challenges, Uganda Airlines performed its inaugural flight on August 27, 2019, becoming the country’s new national carrier and assuming route rights under Uganda’s bilateral agreements.
“It’s the only designated airline. There are other small private airlines in Uganda, but they are focused on domestic and small regional operations,” Muleya said.
The fledgling airline quickly took delivery of four new Bombardier CRJ900s and ramped up to seven destinations, serving Bujumbura (Burundi), Dar es Salaam (Tanzania), Juba (South Sudan), Kilimanjaro (Tanzania), Mogadishu (Somalia), Mombasa (Kenya) and Nairobi (Kenya).
But there is more. Uganda Airlines will take delivery of two A330-800neos in December 2020 and January 2021, putting pressure on the start-up to rapidly grow its regional feeder network, ahead of its planned long-haul launch in early 2021.
“We are still continuing to open routes, because the network has to be ready for the A330s,” Muleya said. “Currently, we are the gateway for Somalia, South Sudan and Burundi. We want to be the gateway for eastern Congo, as well. We have plans to go to three points in the Democratic Republic of the Congo (DRC) – Kinshasa, Goma and Lubumbashi.”
Other planned regional destinations include Addis Ababa (Ethiopia), Harare (Zimbabwe), Hargeisa (Somaliland), Johannesburg (South Africa), Khartoum (Sudan) and Lusaka (Zambia). “Those are some of the routes we are looking at to provide regional connectivity,” Muleya said.
The airline is going through a much faster ramp-up than originally planned, because the A330 delivery schedule remained unchanged, despite the nine-month financing delay.
“We have the issue of losing that nine-month period, because if we don’t have the network right with connectivity, then we lose out on feeding the A330s,” Muleya said. “Our shareholders said we can’t delay the aircraft, so the agreements are signed, all the deposits are paid, the money is ready to go for when we receive them, so our work is cut out for us.”
Depending on traffic rights, the first routes for the A330s will most likely be London (UK) and Dubai (UAE), followed by Guangzhou (China).
“Then we’re looking at routes also to India, where the traffic profiles are growing to Uganda. Depending on loads, we’ll also run it [the A330] north to southern [Africa], and to west Africa, to complete the connections across the long-haul market.”
By the end of 2021, Uganda Airlines plans to serve 20 destinations. This is an ambitious start-up.
So how will Uganda Airlines avoid the pitfalls experienced by other ambitious African carriers? “The reasons for setting up the airline have to be clear,” stressed Muleya. “The underlying reasons were debated and studied over a period of two to three years – and it was four years between 2015, when the project started, and our launch in 2018. The government is very clear about its reasons for starting Uganda Airlines.”
Muleya is also assuming that it will take seven to 10 years for Uganda Airlines to make a bottom-line profit.
“The government is looking at the airline, not only for profitability, but also for infrastructure,” he said. “We expect that, within five to seven years, we can make the company cash positive. Thereafter, that’s when you target bottom-line profitability.”
However, partnerships could shrink that timeline. “Strong partnerships with carriers can strengthen your market presence, performance and payback,” Muleya noted.
With this in mind, Uganda Airlines is keen to work with existing carriers serving the region, such as Emirates, Ethiopian Airlines, Kenya Airways, Qatar Airways, SAA and RwandAir. This would initially take the form of interline agreements, until Uganda Airlines has secured its International Air Transport Association (IATA) operational safety audit (IOSA) approval.
“We want to do it [IOSA] in the next year or so, because we need it for when we go international, to avoid a lot of questions on our practices and standards. That’s another live project that we are starting now. There is no shortage of work at the airline at the moment.”
Some of this heavy workload includes setting up internal suppliers for the airline. To maintain costs and ensure quality standards, Uganda Airlines is planning to self-handle at Entebbe and create its own in-house catering and maintenance operations. This could also generate income from other airlines.
“On the maintenance side, instead of paying a provider, the plan is to go into a joint venture with an international partner to set up a maintenance, repair and overhaul operation (MRO) in Uganda, which can employ our people,” Muleya said.
“I think, initially, it would be up to C-check, because our aircraft are still new. So, for the first six years there are really no heavy checks. After that, we can expand and tailor it according to our needs.”
The government has provided Uganda Airlines with a head office and hangars at Entebbe Airport.
These projects are happening in parallel with the rapid network expansion. “We are trying to remain calm and take it on board, but under the water there is a lot of paddling going on!”
Amid the flurry of activity, Muleya recalls three standout challenges – skills, systems and social media.
“In any new project, the greatest issue, having found the financing, is getting the skills. You need to get your pilots, your engineers, your flight attendants – everybody – and then train them to the standard that’s required for you to get properly licenced. That is one of the biggest challenges for airlines, even established ones.”
The next challenge is setting up the complex internal workings of an airline.
“An airline is never really the aircraft. An airline is structure and systems that enable you to be visible, to establish your brand, sell and be distributed across the world. These are the issues that we’ve had to grapple with and the issues that continue to be consolidated today.
“It takes time for you to be properly connected everywhere you want and for all the systems across the industry to talk to each other. There are lead times for testing, connectivity, partnership discussions and agreements.”
Finally, comes a more modern hurdle – social media and its impact on public perception.

“Within the country, there has been a lot of debate, which has occurred mainly on social media. Social media catches worldwide attention and that is one of the biggest challenges. That debate has fuelled the discussions on almost every aspect of the airline.”
This means Uganda Airlines has been through all the normal start-up stages in the public eye. “First, there was scepticism that this project would start. Secondly, when the aircraft started arriving, people started believing, but they were never quite sure that we would fly. When we took off and flew, the question was ‘are we going to land?’ And now that we have taken off and landed, the main issue is, can we sustain this? Sustainability is a critical issue for the nation.”
While Uganda Airlines is important for the economy, it is also strongly linked to national identity and pride. “This is probably one of the important aspects that has come out of Uganda in recent years; it is a big milestone for our country,” Muleya said.
“In terms of airline development in Africa, most countries have tried and failed. The majority have given up, so now there is a new wave. It’s like a new dawn in the African aviation industry and, for that reason, it is not only important for Uganda, but also for the continent, to demonstrate that you can start and be successful in this industry – and sustain it for the benefit of your economy and your people.”
In his free time, which seems unlikely given the scale of this project, Muleya likes to reflect on life’s lessons. His first learning is that no challenge is too difficult. “Anything can be overcome if you apply due diligence, commitment and you go into the detail with a clear vision of what you want to achieve,” he said.
Muleya’s second piece of wisdom explains how he finds time to reflect on these lessons. “You have to enjoy what you do, but you need to be balanced about it. You need to give to yourself, and to the organisation, at the same time. It’s only when those two meet that you can be successful and be satisfied with what you have achieved.”
So how is Muleya finding his own balance? The answer lies in his original passion for travel. “I think I’m going to enjoy my time in Uganda. Our airline advertises the tourist attractions of Uganda. Maybe I have to get some personal experience of everything that the country has to offer, so that [advertising] comes from the heart.”
Last year, Uganda was voted the friendliest country in the world and – with up to 56 tribes and cultures – there is plenty more for Muleya to explore.
 

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