Air Mauritius was incorporated on 14 June 1967. Its inaugural flight took place between Mauritius and Reunion with a six-seater Piper Navajo PA-31, leased from Air Madagascar.Today, 50 years later, Air Mauritius has successfully emerged as a world class company having bagged many prestigious international awards and awaiting the delivery of new Airbus aircrafts.
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It has indeed been a glorious path traced out by Air Mauritius over five decades of operations. The company, which has known ups and downs, seems to be now firmly on track for a brighter future thanks to its fleet renewal being in good progress, and its diversified activities coupled with major investment in human resources and technology.
Financial results
The national airline hasn’t had remarkable financial results during the past six years. In 2010/2011, Air Mauritius realised profits of only 9.9 million Euros. Thereafter, it registered losses for two consecutive financial years (loss of 29.2 million Euros in 2011/2012 and of 3.6 million Euros in 2012/2013). It renewed with profits in 2013/2014 to the tune of 7.3 million Euros but incurred losses again in 2014/201 to the tune of Rs 23.6 million Euros. The situation improved in 2015/2016 with 16.5 million euro profits declared.
Obviously, challenges are also evolving. Regional and international competition is forcing the company to reinvent itself. The further opening of our skies, a boon for the tourism industry, is both an opportunity and a threat to the national airline. Opportunity arises with more code sharing with major airlines, but more offerings mean consumers have a choice and airlines have to battle to keep their customers through innovative services.
Air Mauritius has been expanding its network of destinations, but not all are necessarily profitable, as explained by former CEO Manoj Ujoodha below. The company also operates a cargo hub and helicopter services and has invested in diversified activities. The main factor that has affected its growth is the volatility of fuel prices, and the ‘hedging’ saga some years back was one of the most serious turbulences to have rocked the company.
A major investor in people, the company wants to ‘mauritianise’ its pilot team by up to 60% within the next three years.
Reward for employees
Air Mauritius shares its festive mood with its employees. All employees of the company (except those with less than one year of service) are being rewarded with a bonus of Rs 20,000 each. Those with less than one year of service will be rewarded pro-rata. The objective is to recognise employees’ contribution in the glorious achievement of the company. Indeed, after suffering severe losses in 2014/2015, the airline registered profits in 2015/2016.
Promotional offers
To celebrate its golden jubilee, Air Mauritius has announced promotional fares for the benefit of its customers and regular flyers. The airline started in 1967, just a few months before Mauritius became independent. Since then, it has partnered with many stakeholders of the economy and has been present in the lives of Mauritians. All its customers who have purchased tickets between 15 May and 13 June 2017 were eligible for a lucky draw, which was conducted on 14 June 2017. Fifty customers have the chance to win a credit voucher worth a 50% refund on the net price of their tickets. This credit voucher may be used for the purchase of their next Air Mauritius ticket. The competition is valid for all tickets purchased in Mauritius (including Rodrigues) and valid for travel from Mauritius (including Rodrigues) on Air Mauritius flights operated on its network. Tickets may have been bought from travel agents, on the Air Mauritius website or from the Air Mauritius Call Centre. Air Mauritius also planned many surprises for customers buying their tickets or travelling on Air Mauritius on the 14th of June.
Manoj Ujoodha G.O.S.K: “The clannish culture must be addressed urgently”
Manoj R K Ujoodha was appointed CEO of Air Mauritius during Financial Year 2006/ 2007, when the company made EUR 15 M operating losses mainly due to inherent structural issues. He successfully implemented a comprehensive change programme covering operational as well as organizational areas. As a result, after nearly four years in office, Air Mauritius declared operating profits (excluding hedge payouts) of EUR 16 M. In 2009 structural changes brought to the company enabled it resist the worse crisis the airline industry had known. Manoj was also instrumental in coining the new vision for Air Mauritius: “Your Preferred Leisure Airline to Mauritius”. He also implemented a new corporate identity for Air Mauritius, changing the old brand signature after 40 years. The new livery was implemented across the organisation.
News on Sunday sought the views of the former CEO on the future of the airline.
“It is indeed a great achievement for Air Mauritius to celebrate its 50th anniversary when Mauritius is going to celebrate its 50 years of independence next year. The destiny of Mauritius and of Air Mauritius is linked and Air Mauritius was formed by its founders to connect Mauritius to the world and the world to Mauritius. The future of the airline is promising with code sharing with a number of airlines and the latest code sharing with the Dutch airline KLM will mark a new chapter for Air Mauritius. The tourism sector will be boosted by this new development.
Air Mauritius needs to identify hubs in major geographical locations and cannot have direct operations to too many destinations just to satisfy a few. Identifying Singapore to link Mauritius to China is a good move and the right way to go. However, Air Mauritius is losing a lot of money with its operation to Mozambique and Tanzania and there is a need to take a fresh look and revisit this decision.
Air Mauritius fleet has become quite old and the product and offering is outdated. Fortunately, this year Air Mauritius will welcome two new A 350 in its fleet and four more in the coming years and also two A330 NEO in 2018 and this will bring the airline at par or even exceeds the competition product offering. I also gathered that the existing fleet is being retrofitted and the product is being refreshed according to international norms.
Air Mauritius is benefitting from historical low fuel prices and this is translated to profitability for MK. However, this is the time for the airline to restructure and look for efficiency gain and take bold moves, which unfortunately is not happening. Air Mauritius needs to move its head office to the airport, which is more logical and this will translate into efficiency gain.
The greatest asset of Air Mauritius is its people but unfortunately throughout the years due to political interferences and mismanagement and protecting family and friends’ interest to the detriment of the airline, has lead to a clannish culture, which needs to be addressed urgently.
The future is promising for Air Mauritius but there is an urgent need to ensure that there is Good Governance at all level and right from the top coming from the Board that needs to set the pace and be the role model. Only the implementation of Good Governance practices at all levels will take Air Mauritius to the next 50 years.”
New fleet order
On 13 February 2017, Air Mauritius announced the future addition to its fleet of two new Airbus A350-900 by the year end. The company has also ordered two Airbus A 330 which will be delivered in 2018. Six other A 350 will join the fleet by the year 2023. In 2018, existing aircrafts will undergo major renovation to bring them in line with latest industry norms.
Major turbulences
In September 2001, a major enquiry at Air Mauritius revealed the existence of a secret fund used for unauthorised payments and free tickets distributed to politicians and journalists. It was alleged that the financial malpractice involved a sum of Rs 85 million. The scandal was a big blow to the company which was at the pinnacle of progress. Later, in 2009, the airline was rocked by another financial incident, whereby the company made huge losses due to a hedging exercise. The airline had hedged its fuel bill at $105 per barrel as the price of oil surged towards $140. Oil later fell to a two-week low below $66 a barrel. The unrealised losses on unexpired fuel hedge contracts stood at 32.6 million euro as at June 30 2009 compared to 72.2 million euro at March 31 2009. However, the company successfully navigated out of the crisis.
Launching of a Special Commemorative Cover
Air Mauritius and Mauritius Post launched a special commemorative cover today, on the occasion of the 50th anniversary of the airline. The launch function was held at the Air Mauritius Head Office in the presence of Air Mauritius Chairman - Dr Arjoon Suddhoo, Mauritius Post Chairperson - Mrs Gaitree Usha Brijmohun, Air Mauritius Officer-in-Charge – Mr Indradev (Raja) Buton, Mauritius Post CEO, Mr Giandev Moteea as well as senior officials of both organisations.
Air Mauritius has a tradition of holding such philatelic events to commemorate its key historical milestones. On 13 September 1973, it issued a “First flight cover” on the occasion of its first Piper Navajo flight to Rodrigues. It also issued a “First-day cover” to commemorate its first international flight on 31st October 1977, a “First-day cover” to commemorate its 25th Anniversary as well as two commemorative covers on the occasion of the launch of operations to Zurich and to Geneva.
Air Mauritius employees are gathering at the company’s offices in Port Louis, Ebène and at the airport as well as all its offices overseas to commemorate the company’s 50 years of history. A main function for employees will be held in the evening. Gatherings have also been planned for employees on shift and crew members on stayovers abroad. Air Mauritius launched several promotional fares across its network to mark the occasion. A lucky draw will be held at 14H00 this afternoon to reward 50 lucky customers who purchased tickets between 15 May and 13 June 2017. Moreover, customers who will book and buy tickets today will be entitled to a discount. The airline has also planned special treats for passengers travelling today. Several CSR initiatives are being organized as a testimony of the company’s social engagement. The Air Mauritius award was launched last week inviting grade 12 (former Lower VI) students to submit business presentations on the theme ‘Contributing to the Nation for 50 years and beyond’. The first prize for the winning team will be a visit of Airbus Industrie in Toulouse.
This year is also a landmark one where Air Mauritius will be making unprecedented investments in its future. It will be taking delivery of the first two A350-900 as part of an order for eight new generation aircraft. The airline will also embark on a cabin retrofit program on six aircraft of its existing fleet which is due to be completed in June 2018. As from then, Air Mauritius will be offering an upgraded product to all its customers – spacious and more comfortable Economy Class cabins, full flat seats in Business Class, a state of the art entertainment system and WIFI connectivity on board. Following the launch of double daily flights to Pierrefonds, Reunion Island, the airline will start operations to Amsterdam with partner KLM and resume seasonal operations to Geneva as from this year.
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