(Bloomberg) — Air Zimbabwe Ltd., the state-owned carrier that declared itself insolvent this month, is considering long- haul routes and seeking partners in an effort to repair its finances.
The airline will decide by the year end whether to start flights to China and Brazil, acting chief executive officer Edmund Makona said in an interview on March 25. Another potential destination is New York, he said. The company’s only current international destination is Johannesburg.
“Air Zimbabwe makes a loss by not flying,” Makona said at the company’s headquarters in Harare, the Zimbabwean capital. “There are fixed costs which the airline will be incurring by not flying — it’s about $2.4 million a month.” The expenditure relates to salaries and maintenance, he said.
At its peak in the 1980s, Air Zimbabwe flew to cities including Sydney, London and Athens before running into financial difficulties as the country entered a near-decade long recession that ended in 2009. Pagiel Chimudzi, the airline’s general manager for finance, told lawmakers March 16. that the airline is insolvent and needs investment of about $260 million from the government to stay in business. Air Zimbabwe has nine aircraft including two Airbus Group NV A320-200s and two Boeing Inc. 737-200s, according to aviation website www.ch-aviation.com.
The airline is seeking a technical partner to “ensure a resurgence,” Makona said. “The focus is on getting entities that provide technical and financial capacity to move the airline forward.”
The company is carrying out a route analysis to assess how much it would cost to start flying to China, according to Makona. President Robert Mugabe’s government has forged economic and political ties with Beijing over his almost three decades in power, creating potential demand for flights.
