Still loss-making, Air Tanzania cut losses by 40% in 2021
In 2016/17, the Tanzanian government decided to restructure Air Tanzania Company Ltd (ATCL). Despite this reform, the national airline is still not profitable. Nevertheless, it is continuously improving its financial deficit.
Although still in the red, Air Tanzania improved its performance in its last financial year. According to the 2020/21 annual report, published in April 2022, by the Comptroller and Auditor General of Public Entities, National Audit Office, the national carrier's losses fell from TZS 60.25 billion (USD 25.62 million) in 2019/20, to TZS 36.18 billion (USD 15.37 million) in the following financial year (ending 30 June 2021); a reduction of 40.06%. This is a consequence of lower operating costs (-3%), and higher revenues, from TZS 157.60 billion in 2019/20 to TZS 174.59 billion in 2020/21; a difference of TZS 16.99 billion (11%). These losses are mainly due to the low utilisation of its two Boeing B787s, whose operating cost/revenue ratio gives a marginal deficit of TZS 23.61 billion.
"A detailed review reveals that the Boeing underperformance is due to low load factors, reduction in the number of destinations (routes) compared to those planned. It was noted that most scheduled routes were cancelled during the year due to low demand caused by the uncertainties of the Covid-19 pandemic. The other reason is the delay in reviving the international routes," says auditor Charles E Kichere. In contrast, the four Dash-8 Q400s and two Airbus A220s generated marginal profits of TZS 12.26 billion and TZS 12.09 billion respectively. The Dash-8 Q300 has been grounded for more than three years due to lack of repairs.
