Podcast: RwandAir sees growing demand for dedicated freighters

Jeff Lee
Hello and welcome to this episode of cargo facts connect, the podcast of cargo facts, the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I’m Jeff Lee, editor of cargo facts and it’s Friday, the 13th of December. Africa’s freighter fleet continues to expand, and over the past year or so, we’ve seen more of the region’s carriers take on 737ng freighters. One of the earlier entrants was Rwandair, which has been operating a 737-800SF for about two years now. This month, my colleague Robert Luke spoke with RwandAir’s director of cargo, Jean Bosco Gakwaya, for an update on the airline’s cargo business and freighter strategy.

Robert Luke
Hello, Jean, and thank you for joining us.

Jean Bosco Gakwaya
Thank you, Robert.

Robert Luke
It’s a pleasure to have you. We look forward to this discussion today and before we begin, please take a moment to tell us a little bit about your background and experience in how you able were able to elevate to the position of Director of Cargo for Rwand Air.

Jean Bosco Gakwaya
OK. Thank you very much, Robert. As you mentioned, Gokuable director, cargo services in Rwandair. With the company for now 12 years. I started as a junior cargo staff. We’re back as I joined the institution and from there I grew up from from within the operations team I was. I first took my my managerial position as a deputy ramp operations manager. Which position I held for a few months and I was promoted as to be the manager of ramp operations. From ramp operations, I held a position for two years and later I I joined cargo department where I became the manager in charge of cargo and from that position that was in 2017. That’s where everything everything started because the shareholder who is the government of Rwanda had marked on positioning cargo as one of the major strategic contents of depending on the importance of the country. As being a landlocked country, we looked at cargo being strategic and important player in the market. So it’s when I took up the position of cargo and I grew up from within one year, I became the senior manager and until recently as promoted as the the Director, cargo services. During my time there, we managed to position ourselves in the market and grew ourselves as a strong player in the market and currently we do have operations, I mean freighters. And also we took up the warehouse operations at Kigali International Airport and looking at a company, I mean, the department has grown. It used to be under commercial, but now it is a stand alone department and it comprises both the commercial and operations so it’s basically that would I would say that was the background of myself. And as far as how we have grown in cargo.

Robert Luke
Thank you for sharing, John, and it’s good to know like me, you started from the ground up and worked your way to position you have currently hold that you currently hold with Rwand air. Over the past 12 years what are some of the changes? Some of the aircraft that you’ve operated in terms of cargo service and what is some of the progress you’ve noticed? Not only just in Rwand air, but also throughout the continent of Africa itself in regards to cargo operations.

Jean Bosco Gakwaya
One thing of note, of course we all know the impacts of COVID-19 basically transformed the perception at which people are looking into the business for cargo in general. So from that point, that’s when realistically you could see there’s. They need go from there and of course there are big carriers that were engaged in this business. But during I would say that during COVID-19 it’s when the the entire industry, visual industry saw the importance of having cargo business because all we know that by the time. All passenger flights were run offline and soon freighter was only moving. So from that time within the region and over the group, that’s been a lot of carriers started looking at cargo business as an important element. So I would say that in general, the cargo business has grown, but mostly it has been escalated by the influence of COVID and also the need brought about by E-commerce and also the exported to Europe and other markets. So those two elements are done that are replayed a big factor in bringing about the demand and the growth of freighter on the continent.

Robert Luke
And with that being established and one of the key points you mentioned, Rwanda is a landlocked country within Africa. How much of that air cargo dependency has been placed upon rwand air, and how many other? Potential new cargo entrants or existing cargo operators have been looking to grow and develop the cargo market within Rwanda?

Jean Bosco Gakwaya
OK. Rwanda being of course, as you mentioned being a landlocked country, it was very important for us to have a solution in place. That’s where the airline looked at being on board a Boeing 738 a narrowbody freighter that currently serves the region and also operates to the UAE. But of course we previously had the wide body flights going operating to Europe and and UK. By this we utilize the bearing capacity which of course enables us to do move huge volumes, whether from Rwanda or from I mean return flights. So basically the the most important thing was us looking at the demand ahead and also understanding the the the dynamics of being into this kind of business, but also factoring in that we are landlocked. And also when you look at where Rwanda is positioned, it’s we no longer see it as a challenge in that also we we look at the strategic position of the country and see that’s offers a solution to other countries because we it’s easier to connect the entire African continent to the rest of the world using Kigali as a hub so reason we also focusing on growing Kigali hub to ensure that we we give service, improve the service delivery and also serve our clients all over the continent and the region. So we are also looking at of course as demand comes up looking, we are looking at bringing new widebody freighters so that we can try to answer the this one brought about by the demand, whether from the Rwandan market or of the region, and basically intra African market.

Robert Luke
So speaking to that widebody freada, will that be more of a dedicated freighter that will join the Rwand air fleet? Are you more encouraged to add wide bodies to your cargo fleet, seeing that last year you made your you all generated revenues around 461 million, which shows a significant growth for the carrier itself?

Jean Bosco Gakwaya
So. The reason why, of course, when you say dedicated cargo freighter, it’s we currently have a dedicated freighter, though it is a narrowbody and we think that it has helped us to establish ourselves on the market and build confidence in our clients. So basically, that’s why we’re looking at bringing in a widebody to accommodate the demand that has been been brought, brought by the the Narrowbody services and also the wide body, I mean the A330 passenger flights.
So with us, we are looking at bring in the widebody just to to react to the demand brought about by by, by, by the the business in general and also the freighter because currently we are not only serving the Rwanda market, but also we are looking at the region and and also the rest of the continent. And also we are trying to see that we we we try connect the Rwanda private sector to the rest of the world. So basically 330 freighter that we are looking up is to really try and bring the gap that is brought about by the demand. Triggered by the freighter business that recently joined our fleet.

Robert Luke
So you’re looking at an A330 freighter type. Do are you looking to lease or you’re looking to acquire this A330 freighter?

Jean Bosco Gakwaya
Looking at the current situation. Leasing would be more would make commercial sense and that’s the the the current process that we are viewing. But these things can always change at anytime time. But for this case we are trying to, we are looking at leasing.

Robert Luke
OK. And from that aspect, with you operating the 737 800 freighter and looking at an A330F, would you and seeing that you operate a mixed fleet as it is, would you at some point also consider perhaps even adding another narrowbody freighter type, whether it’s another 737 8 hundred or A321 freighter or maybe even A320 freighter?

Jean Bosco Gakwaya
Definitely that is a prospect that would assess in near future dependent on how the market reaction will be. But you’re right. Because once the widebody freighter comes in and there could be a need to add another narrowbody just to feed and defeat, depending on the the market situation. But that is something that we could look into, though the nature of the of equipment that would be bringing onboard would be it could be on a 321 or or 738 like you mentioned, but that is something that definitely will keep in our mind in the near future.

Robert Luke
Thank you for sharing, Jean. As I’m kind of just doing a little bit of research here, I see that you have a lot of perishable products that are distributed from Rwanda. How much of that is distributed? If you had to do a breakdown of of of a ratio to percentage, how much of that of the perishables or distribute distributed internationally versus within the continent of Africa or even domestically within the country self and how does that play into your cargo strategy as you kind of now aim to add a wide widebody freighter to your fleet. I see you have like for example, bananas and sweet potatoes and cassava and sorter gum and sugar cane and pineapples and you know potatoes, which is really the bulk of your perishable items here. How much of that do you all move as a carrier on behalf of the manufacturers and distributors of those perishables?

Jean Bosco Gakwaya
I won’t be exact with the percentage ’cause we we currently work with with our stakeholders, the national Agriculture Export Board and I would probably ask them to provide us the actual data. But currently if I look at the metric, I mean the export data that we do have. Would say that mostly. 81 80% goes to export.
We export it to Europe And I mean, I would say that maybe probably between 90 or 80 is exported between Europe and UAE because UAE we are currently exporting avocados and then the rest of the chili and other perishables are exported to UK and Europe. But for the intra African market, of course we are trying to to build on that as well through the Afcfta Africa, Continental free trade area. And also we are trying to see how basically we can diversify the markets.
So I would say that currently the huge chunk of volumes is exported to UAE and and Europe and the UK, but also in the we are working as I mentioned with the stakeholders together with the exporters association to see how much we can also diversify and try to do trade between Rwanda and the African continent in general.

Robert Luke
And speaking on the Africa free trade lanes there, what challenges has Rwandair faced in establishing or collaborating with existing carriers registered in Africa
in a more transparent bilateral agreement under the single traffic rights, particularly going back to the Yamasuko declaration that was initiated back in the early 80s but not actually finalized until 2000. Are you seeing progress with that? Are you seeing more willingness to collaborate between government bodies and and private carriers that are operating within the continent?

Jean Bosco Gakwaya
Definitely today there’s a progress as you see. Recently we launched that and it’s it is something that I feel needs time as people try to align with the the importance of this kind of partnership whereby different countries do trade between one another. Of course, there will always be challenges, of course, with the air freight and prices, but I think with time, as people see the importance and understand. The results and the importance of people doing trade and also the positive results brings, I think people who all countries will start seeing it in a more positive and broader way. So with time, these kind of initiatives require some time and understanding. And as people keep on discussing through different forums and then other different countries that have not yet bought into the idea will definitely come on board, so I feel like, yeah, at the beginning, definitely there will be challenges, but we think in years to come it will be positive. This will be a success.

Robert Luke
Jean, thank you again for this interview with us and providing such great insight into RwandAir’s operations.

Jeff Lee
That was Rwandair Director of Cargo Services Jean Bosco Gakwaya, talking to my colleague, Senior Associate Editor Robert Luke. And that’s all the time we have today. For more coverage of the freighter aircraft market, visit cargofacts.com. Thank you very much for tuning in, and join us again next time.