Air Uganda and Rwandair call off codeshare agreement

While Ugandan President Yoweri Kaguta Museveni honored his Rwandan counterpart Paul Kagame in a ceremony at ‘Liberation Day’ in Kapchorwa/North Eastern Uganda on Thursday, Air Uganda and RwandAir reportedly “broke off relations” when notice was served by Air Uganda to terminate the existing code share arrangement between the two carriers effective March 2012.

As in many such commercial break ups there are two sides to the story and both carriers were understandably shy to go on record other than confirming the development at this time.

Apparently, both airlines did not see their expectations and hopes fulfilled from the code share deal, which was initially aimed at providing an early morning and late evening connection between Entebbe and Kigali, allowing for one day trips on business, something many travelers took advantage of in the past.

While RwandAir since signing the agreement embarked on an aggressive growth strategy, which saw their fleet grow to 7 aircraft, Air Uganda struggled to reverse flagging fortunes caused by the business choices made by several rather inept managers from Italy’s Meridiana, a sister airline under the same ownership. Only when CEO Hugh Fraser arrived did a turnaround take shape, now continued under Kayle Haywood who joined U7 from Air Arabia in October last year.

However, across the border were a new Board of Directors chairman and members of the board unveiled last week too, with aviation veteran Wake, formerly a long serving Ethiopian Airlines’ CEO, now at the helm. The move is injecting some serious African aviation expertise into RwandAir and will undoubtedly help shape the airline’s ambitions towards turning them into reality, given the support the airline enjoys from the highest levels of government in Kigali.

It is understood that Air Uganda is now more actively looking at expansion again, already flying twice a day between Entebbe and Juba / South Sudan, while RwandAir is also working on new destinations, in the region and beyond, where they already fly to Johannesburg, three West African destinations – Brazzaville, Libreville, Lagos – and to Dubai.

A regular source from Kigali recently said: ‘New destinations for RwandAir are being evaluated but the airline needs to have additional aircraft to accomplish that and sustain a growing network. It will go step by step and as new planes arrive new destinations will be unveiled’.

Flights between Entebbe and Kigali though, once the code share partnership officially ends, will probably see added services as permitted under the bilateral air services agreement between the two countries, which will as a result keep fares low for travelers but will equally pose a financial challenge for the two airlines to make commercial sense out of the route and sustain long term the number of daily flights.