In his State of the Nation Address on June 4th, Hage Geingob, the Namibian President, called for the liquidation of the country’s flag carrier. According to his remarks, the airline has not been turning a profit and must be liquidated instead of being given additional bailouts. This comes as the airline industry as a whole is facing one of the worst crises in recent history.
Namibian President calls for flag carrier’s liquidation
In the State of the Nation address viewed by Simple Flying, President Hage Geingob had the following statement:
“Yes, Air Namibia must be liquidated. We have a very serious problem in Air Namibia. Firstly, Air Namibia was bailed out, bailed out. Liquidation, whatever it is, is being considered. It must be restructured. And, if liquidation is the thing, we must do that. It is not making any profits, just being bailed out, bailed out. No, we must do something about it.”
This comes as the airline enters a significant cash crunch. Previously, the carrier suspended operations as a result of the current coronavirus crisis putting extreme downward pressure on the airline’s finances.
Beyond that, the carrier has needed government assistance. In the past year, the airline was slated to receive aid from the Namibian government. This came only a few months after the airline’s A319s were grounded over unpaid debts.
Another flag carrier runs out of runway
Air Namibia is a government-owned airline. And, like other government-owned flag carriers, it has been struggling. Air India, Alitalia, South African Airways, Thai Airways, and others are just a few examples of struggling national airlines with somewhat diminishing importance.
Air Namibia is quickly running out of runway. Without the backing of the government, it will have to find some other source of funding to keep moving forward. With passenger revenues remaining low and foreign investors likely feeling skittish about investing in the airline, there may be few other options.
What would happen to Namibia’s air connectivity?
One of the biggest concerns of any country on the demise of its national carrier would be the lack of air connectivity for its citizens and others. Air Namibia’s main operating base is Hosea Kutako International Airport in Windhoek, the country’s capital city. From there, the airline flies to an impressive number of destinations, including Cape Town, Durban, Frankfurt, Johannesburg, Lusaka, Victoria Falls, and Walvis Bay in Namibia.
However, several other foreign carriers also fly to Windhoek. This includes Eurowings, Ethiopian Airlines, Condor, KLM, Qatar Airways, South African Airways, British Airways’ Comair, and TAAG Angola Airlines. Domestically, Air Namibia prefers to fly out of Eros Airport– also in Windhoek.
One thing going for the liquidation of Air Namibia is that it is not a large airline. According to data from Planespotters, the airline only has nine aircraft in its fleet comprised of A319s, A330s, and ERJ135s.
Starting over, the Namibian government could either encourage private investment or else target a new, streamlined, and efficient flag carrier that would likely focus on domestic routes and partner with an outside airline for international flights.
Do you think AIr Namibia should be liquidated? Let us know in the comments!