Air Seychelles announces business transformation plan to safeguard long-term profitability

Eleanor Steed
By Eleanor Steed January 29, 2018 16:43

Air Seychelles announces business transformation plan to safeguard long-term profitability

Air Seychelles has announced a new strategic transformation plan – approved by Air Seychelles’ Supervisory Board and both shareholders, the Government of the Republic of Seychelles and Etihad Airways – aimed at ensuring the long-term profitability and sustainability for the airline.

Due to the expected influx of inbound seat capacity in 2018 due to new routes by competition airlines from Europe, Air Seychelles will consolidate its international network by suspending its Paris service effective 24 April 2018 and exit the two leased Airbus A330 aircraft out of the fleet.  As part of the network efficiency development strategy, and considering the high dependence on the Paris traffic feed, the airline will at the same time discontinue its Antananarivo service.

All guests scheduled to fly on the Paris and Antananarivo routes beyond that date will be re-accommodated on other flights and will be notified of the changes to their itineraries.

Remco Althuis, Interim Chief Executive Officer of Air Seychelles, said: “The launch of competing air services from Europe to Seychelles will significantly impact Air Seychelles’ flights to and from Paris, which account for approximately 30% of total passenger revenue at the airline, making the route unsustainable in the long-term.

“After considering all the options, we have taken the decision to withdraw from both Paris and Antananarivo and refocus on our core strengths – our domestic and regional networks. Doing so will enable us to concentrate on more profitable areas of the business, while people in Seychelles will continue to have non-stop access to France and wider Europe through airlines that can operate at more efficient international scale than Air Seychelles.”

As part of this strategic transformation, Air Seychelles will replace its regional fleet of two Airbus A320 aircraft with the next generation aircraft in 2019, enabling the airline to offer greater levels of comfort while increasing seat capacities and reducing operational costs.

In addition, the airline will concentrate on developing its domestic operations, including inter-island flights between Mahé and Praslin, scenic flight packages and island charters, which are set to play an increasingly important role as more international travellers visit the archipelago.

These developments will be coupled by a number of new cost-saving and revenue-generating initiatives in 2018, including projects aimed at strengthening non-airline areas of the business such as ground handling, cargo handling and engineering services.

The Air Seychelles product and service offering will also be reviewed to reflect the latest trends in air travel and provide an enhanced experience through the Air Seychelles website and other digital platforms.

Althuis said: “The key differentiator of Air Seychelles has always been its creole spirit and exceptional service, and we will explore ways of building on this foundation while developing our offering to better meet the needs of modern travellers, who are increasingly looking for a more personalised travel experience. Our goal will be to restructure our cost base while retaining all the standout qualities that make Air Seychelles so unique.”

This refocusing of the business will include a reduced workforce in cabin crew and pilots, as well as supporting flight and commercial roles. Air Seychelles will provide compensatory packages to affected staff as well as support with job searches and employment.

Robin Kamark, Chief Executive Officer Equity Partners, Etihad Aviation Group, said: “Etihad has a strong and close partnership with Air Seychelles and we continue to stand alongside the airline as it undergoes this crucial transformation. This strategic business plan has been developed to reflect the realities of the market today and place Air Seychelles in a strong position for further growth.”

Eleanor Steed
By Eleanor Steed January 29, 2018 16:43