Mozambique Island Air Transfer Rate Increase

There have been various enquiries regarding the recent price increases that ranged from 11% to 31%, however, the average increase was actually by 22%. Solenta Aviation Mozambique SA, would like to take this opportunity to clarify the reasons for the rate increases that have been recently announced:

1. Solenta Aviation Mozambique S.A previuosly CFA Charters Mozambique, has been operating the aircraft used on the island transfers on behalf of Rani Investments under a management contract. Under this contract CFA Charters, at the time, incurred huge losses that threatened to terminate these services. Rani agreed in June 2012 to underwrite these losses for a continuation of the services by contributing towards the operational costs. In early 2013, the larger resort operators were requested to choose between contributing to operational costs of the service or to absorb the costs via seat rate increases, the operators all elected seat rate increases. Increases were made in February 2013 however, these were not substantial enough to recoup the cost of the operations as the numbers of transfers have not been sufficient.
2. Apart from the fact that we were already coming from a position of under recovery, the cost of doing business in Mozambique, Pemba particulary, has escalated exhorbitantly over the past year;additional requirements by the licencing authorities as they recertify air operators, including SAM, in an effort to rectify the country’s blacklisting with the EU; increased air fares to move crew around; increased costs to have engineers based full time on islands to support operations; increased office rentals as the airport builds new airports, higher costs of workshop facilities, the list goes on. These costs have been absorbed by Rani over the past year.
3. In the case of the lodges that use other service providers for their transfers and SAM is really not their main service provider, we have had to make substantial increases in their rates, due to the low number of pax being transferred, mainly 2′ s and 3’s, as well as in most cases these are often  either just  a drop off or pick  up  and result  in  dead  legs thereby  making the routes uneconomical for the transfer operator.
4. The final aspect is that the rand has depreciated from R9:$1 to Rl 1:$1, a 22% move that we have had no choice but to pass on to the rand clientelle.

 

Brian Anthony Holmes – MD Solenta Aviation