World Cup to kick start charter in Africa

World Cup gives a boost to development of African charter market

The World Cup attracts the attention of millions of football fans from around the world and the 2010 host South Africa is busy improving air, road and rail infrastructure. For charter brokers and operators seeking to increase business during the global recession, the event provides welcome opportunities and bookings are already being made.

Air charter brokers are homing in on Africa. Chapman Freeborn Airchartering (CF) and Air Charter Service (ACS) have opened offices in key locations to meet varied demand driven by the business attraction of oil and minerals and building of new infrastructure as well as humanitarian needs and the spin-offs generated by major sporting events.

ACS recently opened the company's first African office in Johannesburg, South Africa, to provide both passenger and cargo services. Both ACS chairman Chris Leach and ACS md Tony Bauckham (cover photo) say that an office in the African continent has long been seen as essential to the company's global expansion.

African operation head Lyndee du Toit, who has 16 years of experience in the charter business, says ACS will be targeting growth areas including the demand for services generated by prestige sporting events such as the upcoming football World Cup in 2010. ACS has already benefited from South Africa's hosting of the 2009 Indian Premier League (IPL) tournament which took place from 18 April to 24 May this year with a 59 match itinerary.

Games were played in Johannesburg, Pretoria, Cape Town, Durban, Port Elizabeth and East London. South Africa believes it has now positioned itself as a world cricketing centre hosting events including a major Australia tour, the IPL tournament, the 2009 Champions Trophy and the ICC 2011 World Cup Qualifying Tournament.

Cricketing highlight

Du Toit says: "A lot of cricket fans from India came across to South Africa to enjoy the IPL occasions and a number hired private jets. One client used a Cessna Caravan for a flight to a game lodge. There was a good demand from fans wanting a holiday organised around the cricketing highlights." The British Lions' rugby tour of South Africa was another event generating bookings.

ACS, du Toit says, is already handling demand for reservations involving the football World Cup. "A lot of aircraft have already been booked by people with the foresight to know that demand will be very high. Football associations and fan clubs are among those who are thinking ahead."

Madie Werner, regional marketing manager, ExecuJet, South Africa, which frequently works with air charter brokers, says: "We are certainly expecting a boost from World Cup 2010. We have already received numerous requests for charter and handling over this period. With ExecuJet South Africa's fleet of over 40 aircraft, our world-class facilities at Lanseria, JHB and Cape Town airports, we can offer the best service to travellers."

She confirms that road, rail and airport facilities are improving. "All are being upgraded and/or built throughout the country."

ACS's newly-launched Africa operation is carefully examining the requirements in the humanitarian sector ranging from the need for emergency medical repatriation to United Nations' efforts to alleviate suffering.

South Africa is regarded as a hub through which charters can be arranged to the rest of the continent. Du Toit says: "A great deal of charter is arranged out of here into central and northern Africa."

Local knowledge is important but ACS stresses the safety aspects. "It is vital that charters are arranged with reliable companies that maintain international safety standards. Some countries in Africa are insisting on criteria such as the use of modern aircraft and laws and attitudes are changing. However, there is still an attitude that aircraft that might not be accepted in Europe can be brought to Africa and brokers need to know enough to avoid risks." 

ACS's Bauckham says that having an African presence will allow the company to negotiate better rates with local operators and offer savings to its existing client base for flights in the region. And Leach stresses the benefits to clients of having a presence on the ground to reinforce the Africa service. His thoughts are echoed by du Toit.

'Fantastic procedures'

Du Toit says: "We have developed some fantastic procedures for working with ACS's worldwide network of offices. These procedures will allow us to offer global solutions to local clients. Within a short time of opening we have already seen these systems work successfully culminating in the operation of a number of successful charters." Wider and increasing contacts with brokers, airlines and forwarders are already bringing business dividends.

Chapman Freeborn Airchartering (CF), which has opened an office in Entebbe believes that the strategic location of Entebbe in Uganda is well suited for the short, medium and long-term development of business in Africa.

Iain Clark, regional manager, Africa, who will be spearheading the development of both cargo and passenger business, says: "We will be working closely with the rest of our global network. Entebbe can accommodate wide body flights from Europe, the Middle East, Asia, the Far East and Southern Africa. Suitable aircraft can then be utilised to connect to smaller and remote airstrips across Africa."

Specifically, he points out, Entebbe is well-placed to liaise with the UAE airports including Sharjah and Dubai that have growing business links with Africa and were highlighted in Charter Broker's preview issue. In 2007 CF in the UAE registered a turnover of US$65m and coordinated relief flights when Zimbabwe suffered cholera outbreaks. Clark says: "Our presence on the ground in Africa will build on the very good reputation our worldwide network already has and obviously we will be working very closely with our UAE colleagues as well as with India and the Far East."

CF Entebbe has already worked with the CF London office in helping the United Nations provide humanitarian aid to Dafur from Kigali in Rwanda.

Broker commissions

The effects of the worldwide recession have been felt in Africa but Clark reports that recent broker commissions indicate that business opportunities may be increasing. "In the last few weeks there have been flights by exploration companies to see what might be uncovered in raw material resources into Bangui in the Central African Republic." He adds: "Apart from these drilling expeditions there was also a shipment into Cameroon and these are among indicators that companies are investing in the future despite the wider difficulties in the global economy."

The Democratic Republic of Congo (DRC) has the potential for the widespread exploitation of diverse metals in a multitude of mines and quarries with worked deposits, including zinc, lead, tin and gold in various areas to the south, east and north-east. "Entebbe is well placed for charter flights into the southern DRC and to Zambia," Clark points out.

"There is good potential to establish our base as a transit hub with a large number of small airports in many countries within easy reach of small aircraft once the wide bodied aircraft have touched down in Entebbe. The authorities here are very positive and helpful and want to encourage international business and investment. Tanzania and the Sudan are other countries where there is good potential to develop onward charters using specially chartered five to ten or 20 tonne aircraft."

CF believes that Entebbe's central location will bring cost-saving and geographic advantages but it also recognises South Africa's role as a pivotal hub for charter into Africa.

Clark says: "Entebbe and Johannesburg are complementary and brokers will choose the right hub according to the operator requirements."

Airports around Johannesburg include Lanseria, which provides facilities for numerous charter operators including AirQuarius, Air 200, Allegiance Air, Chilli Pepper Charters, Comair, ExecuJet, Executive Turbine, Fair Aviation, King Air Charter, Legend Aviation, MCC Aviation, NAC, Out of the Blue Safaris, Sefofane Air Charters, Swiftflite, TAB and Zenith Air. It is an airport very familiar with domestic and international mercy flights which is an obvious business target for international air charter brokers. OR Tambo is the big international airport favoured by airlines but there are also facilities at Grand Central, with one 1,830 metre runway, and Rand which was built in the 1930s and is set in an area of natural beauty.

Rand's message to brokers is that it is close to the Germiston Lake and the Germiston Golf Course and is only minutes away from the Johannesburg City Centre, the Johannesburg northern and southern suburbs. It is also at the centre of the Witwatersrand. The airport, which has an off-ramp on to the N3 from the Rand Airport Road, is marketing development opportunities.

Clark says: "There are plans to develop Upington airport as a cargo hub and this is where the vehicle charters operate in and out of, but for general cargo (freighters) and line flights OR Tambo will remain the airport where the demand is."

Sport events will also see spin off business to airports near game parks like Kruger and Pilangsburg (near Sun City) as people take in Africa in between matches.

Clark, who has worked in South Africa and elsewhere in Africa in a variety of management roles in sales and operations for more than a decade, says that CF will apply its global criteria on safety. "Safety is paramount," he confirms. "If we are not happy with that aspect we won't charter the aircraft."

Carol Norman, md of the CF Group, says that Entebbe will unlock further potential for the worldwide network and client base. She can point to operations already successfully carried out. Chapman Freeborn Airchartering provided flights for hundreds of passengers who were evacuated from a luxury cruise ship due to the growing threat from pirates around Somalia. 

Almost 350 passengers travelling from Genoa to Dubai disembarked from the 150-metre MV Columbus in Yemen amid safety concerns as it prepared to sail through the pirate-plagued waters of the Gulf of Aden. 

It was the Dubai office that responded swiftly to provide three B737-800 aircraft. Elderly passengers were flown directly to Dubai from Hodeida while others were given a tour of the ancient city of Sana'a and the surrounding area before departing on two further charters later the same day.

Representatives were also dispatched to Yemen in advance of the operation to make preparations and accompanied the passengers onboard to further ensure the flights ran smoothly. Once the evacuation was successfully completed, the captain of the Columbus and skeleton staff continued on the ship's scheduled path through the dangerous Gulf of Aden. 

The passengers rejoined the ship in Salalah, Oman, after enjoying a three day break in Dubai. 

Chapman Freeborn France also arranged repatriation flights for eight French workers who were taken hostage from a tug supply vessel while assisting an oil loading operation 15 miles off the coast of the Bakasi Peninsula, Cameroon. 

Captives released

A militia group held the crew of the Bourbon Sagitta captive for 12 days. The Marseille office worked through the night to arrange an MD83 aircraft for the flight from Yaoundé to Paris Charles de Gaulle. The high-profile charter for the crew members was arranged after tense but successful negotiations involving the French government, the Tunisian and Senegalese authorities and the local Cameroonian authorities.

Chapman Freeborn Airchartering can now draw on Entebbe for routine and as well as out-of-the-ordinary events.

Charter brokers and airlines confirm the strong demand for space on flights into Africa from companies supplying good and services.

Niek Van Der Weide md of Cargo B Airlines says: "We get regular requests from the major charter brokers for part and full charters which we have regularly operated mainly to Africa and Latin America." Brussels-based Cargo B Airlines reports strong demand for a new B747-400 freighter leased from Nippon Cargo Airlines. The first broker to charter the aircraft was Kales Charters of the Netherlands, which does a great deal of business into Africa, for a flight to Bangui in Central Africa.

Erwin Burger, md of Kales Charters B.V. says that the Ivory Coast and South Africa are among countries generating demand for telecommunications equipment with machinery for oil wells among Nigeria's needs. But the demand is varied with commissions carried out by Kales including providing an AN12 to fly ship spares to Port Sudan. That shipment involved an axis of nine metres length weighing 9,800 kgs.

"There is demand, for instance, from Spain and Portugal for flights to countries including Angola," Burger adds. "We only work directly with what we call 'approved vendors', the airlines, but the checks never-the-less have to be thorough. The documentation has to be correct with airworthiness and insurance certificates among important paperwork that has to be verified."

National criteria

The age and type of aircraft has to fit national criteria, Burger points out, with countries such as Somalia refusing to accept aircraft that are over 20 years old. Kales is also regularly contacted when humanitarian flights are needed.

Historically, South Africa has been seen as a gateway into the rest of Africa, and as trade continues to increase both on and with the rest of the continent, the logistics involved in the transport of these products becomes increasingly important.

The pace of development of cargo air charter broker opportunities in South Africa will partly depend on reducing costs and improving air-road-rail links.

A survey published by the Council for Scientific and Industrial Research (CSIR) is concerned that high costs and inadequate inland and cross-border transport will constrain the logistics industry in South Africa. But it confirms that South Africa has enormous potential to become the Southern African Development Community (SADC) region's central logistics hub, which is particularly important with imports and exports growing at a rapid pace in Africa.

The 2010 world football championships will bring in train developments that could benefit cargo air brokers. ACS's Du Toit points out that Polokwane is an airport that can be considered for almost all aircraft types. But she adds: "It is only feasible if the client wants to visit that area, or for cargo purposes if the client is willing to move their cargo by road.  For the FIFA World Cup, a number of games are to be played in this venue."

There is a drive to improve airports and rail services in countries including South Africa. Sipho Mthombeni, ceo of Gateway Airports Authority Limited (GAAL), the operator of Polokwane, says: "While these transformations are designed to cope with the sheer volume of traffic expected during the four-week period of the soccer event, there are also long-term strategies behind these developments."

Polokwane in Limpopo has been revamped to handle more than 200,000 passengers a year and is also putting facilities in place to house additional airlines.

However, looking beyond 2010, GAAL wants to cement acceptance that the airport is ideally suited to be a cargo hub for Southern Africa. "With its excellent strategic location, nestled between Botswana, Zimbabwe and Mozambique, as well as its close proximity to South Africa's economic capital Gauteng, Polokwane airport is ideally located to capture freight traffic," says Mthombeni. "We see the airport as a catalyst for economic development not only for Polokwane, but for the Limpopo province and the surrounding SADC countries."

He also notes that South Africa's northern neighbours can utilise the airport as a gateway into South Africa. Freight, however, can be sent directly to OR Tambo in Johannesburg. But Mthombeni says: "That airport is already overloaded with traffic and the heavy congestion means the spill-over of freight traffic has to go somewhere. The obvious benefit for using Polokwane as a cargo hub is to relieve the congestion at OR Tambo and capture spill-over freight traffic. There are also benefits for those companies already utilising OR Tambo's facilities. The benefit in terms of freight and airline clients is competitive discounted prices that will range from 25% to 40% lower that at OR Tambo."

Fresh produce

GAAL is targeting the export of fresh produce into Europe as well as processed food from South Africa into the SADC region. But, interestingly for charter brokers, Mthombeni notes that much more than traditional cargo can be dealt with. He points out it could also be "used by the United Nations food distribution arm into transporting relief using our cargo terminal to facilitate an efficient process."

Deals are being sought and negotiated with air freight companies, Mthombeni confirms. He is enthusiastic about attracting business through charter operators and brokers. "The terminal is a worthy red carpet to the soccer fans who will be travelling to Polokwane for the 2010 Fifa World Cup," he says.

The Chartered Institute for Logistics & Transport South Africa (Ciltsa) confirms that the forthcoming tournament has served as a catalyst for the implementation of a number of infrastructure projects, increased investment and the elimination of bottlenecks in freight logistics. Many companies use roads as their main means of transport, despite the fact that for some goods it would be cheaper to use rail transport. Rail will have to prove it is offering cost-effective, reliable and sustainable services to convince user and brokers that they can trust the cheaper alternative.

Currently, however, more than 80% of all goods transportation in South Africa is done by road. Brokers say the cost of transporting products to the export market often amounts to about 50% or more of overall production costs in certain African countries. But there will be improvements generated by the hosting of the football World Cup in South Africa in 2010 and the upgrading of infrastructure to speed the income-generating development of oil and mineral resources. And, once there is an upturn in the world economy, returning prosperity should feed through to tourism and charter demand. Brokers established in Africa can expect to see business increasing as the football gets under way.