This archive report was first published on 5 May 2020.
May 5, 2020, marked a turning point for Kenya Airways as the COVID-19 pandemic exposed the airline's heavy reliance on passenger revenue.
According to CEO Allan Kilavuka, the airline has been heavily reliant on passengers, but it's now time to diversify its business and spread out its revenue streams.
Kenya Airways currently generates 90% of its revenue from passenger services, with a paltry 10% coming from cargo.
The airline is planning to diversify 40% of its business to other revenue streams, including cargo, to cushion itself against global crises like the current pandemic.
However, the airline's lack of long-haul cargo aircraft has hampered its ability to conduct a serious freight business.
Kenya Airways has converted its passenger aircraft into freighters, but this venture is not viable due to the high cost of using passenger aircraft and the minimal cargo being transported.
The airline is expected to make at least Sh200 million from about 53 missions, but this is just a fraction of its revenue.
Kenya Airways is banking on the cargo business, which generates about Sh11 billion annually, to pay salaries and utilities.
However, the shortage in capacity has seen the horticulture sector express its concern over the high charges that freighters are levying, with the cost having doubled due to high demand.
