Yosief- Lets allow time to predict the future of EAL

Selam Yosief,

Thank you for taking time to respond to my divergent view on your series of articles espousing your point of view that staring an airline at this juncture of in the nation's history is doomed to fail and it will cost Eritrea an exorbitant amount of money to maintain and run the airlines for the long term. I also commend you for admitting that your initial estimate in the hundreds of millions of dollars was way off tangent. Obviously, your initial estimate which was acquired from Boeing website doesn't reflect the existing market reality in the airliners acquisitions market. Comparing and contrasting your first article in estimating the cost of acquiring an airliner and that of A/ professor Abebe's, one could easily see the huge discrepancy between these two analysis provided to the public. None the less, you were humble enough to admit that your initial estimate was carried out with hasty and shoddy research on your part. With all due respect, despite your cynicism on the professor's claims, personally I am opting to accept the professor's analysis in making up my mind on EAL's viability.

Yosief in your response you mentioned that I was harping on the initial estimates you provided us. Yes! I was and it is true it was the "central theme" of my feedback. In your first article titled "The Eritrean Airlines: The Golden Pot That Feeds The Hungry Masses", you want us to believe that the "startup" cost for the airlines to be an astronomic amount of money. Here is how you put it. "I wouldn't be surprised if the total cost of launching the Eritrean Airlines would end up hovering somewhere around the whopping $300 million - an amount that is more than half of all the total budget of the nation for a whole year, and, incidentally, equal to all the money that the nation gets from Eritreans in Diaspora in remittances and all other forms of extortions (2 per cent tax, bonds and various forms of contributions) every year! Talk about putting all your eggs in one basket - and what a flimsy basket it is!". You also added saying that leasing will not change the grim picture in the long run either.
Given the prevailing drought in the country, the way you put it is very alarming to any Eritrean who has access to an internet to read your take on the economical viability of EAL. Every Eritrean would ask him/herself, why would GOE venture into such proposal while its people are suffering from the torturous drought? This is very legitimate question and I don't believe any Eritrean leader would entertain such proposal at this juncture of the nation's history. Then there must be the other side of the story!

The issues surrounding the airlines are far from the gloomy picture you tried to paint. In my opinion, we can reach to reasonable conclusions if we are willing to see the issues pertaining EAL by disassociating ourselves at least for a nanosecond from the murky world of Eritrean politics. This noble initiative is taken by group of Eritrean civil aviation professionals and we should give the chance and encouragement in their ambition to see Eritrea with viable airlines for the present and future generations.

In my opinion, your our prediction leaves out important facts about the nature of the airlines, it didn't tell us the fact that the airlines has adequate ground facilities which has been serving Lufthansa , Yemeni, Egyptian and numerous airlines five or six times every single week. It didn't tell us the fact that the airline has about 300 employees of various skills. It also didn't mention the fact that there are several Eritrean pilots who already in Asmara or willing to be employed by the airlines once it starts flying. Taking those facts into consideration, it is natural for the airlines to exploit those existing resources and fly with minimum capacity.
Now we are hearing the other side of the story from the horse mouth. I know you disregarded the claims as half truth, but I am prepared to take their professional claims. The airlines' CEO said that EAL has spent less than a couple million of dollars to acquire the first airliner. The record must be set straight here, the Captain didn't say the startup cost at the present and future is only couple million dollars as you tried to portray in your response to my feedback to your numerous articles on EAL. Yosief, if you are calculating the overall startup cost, you might also need to get facts from Ethiopian airlines on money spent for about thirty years in training those pilots and technicians and maintaining the ground facilities at the then Yohannes IV international airport. And of course, you have to also include the efforts and money allocated by GOE to bolster the capacity of the airport over the last decade. However, I don't think that is the crux of the matter. We are engaging in this thread not to talk about the resources allocated to build those facilities but the amount of money required to acquire airliners, so EAL could efficiently utilize existing infrastructures to taste the challenging skies.

So far the money allocated to acquire the first airliner either through a lease or other arrangements is less than a couple million dollars and if EAL is planning to pay the rest of the amount for the first airliner and acquire more from the profits it garners, then you should be prepared to give it time and chance. Once they default on their payment, then you may have grounds to even write more about the "golden pot that feeds the hungry". However, I don't think it is wise to shoot the airlines with those gloomy predictions before even it takes off the ground!

Now, at least after reading the professor's side of story, I believe the audiences have a good picture of the pros and cons involved in acquiring an airliner either from Boeing directly or from other parties.
The dilemma I find myself in addressing your claims is that - since you discredited the information provided by the airlines CEO and the professor who was involved in the nuts and bolts in acquiring the first airliner as "as half baked truth" and you also admitted your initial estimates that triggered a thread of discussions on EAL were conducted with hasty and shoddy research but determined to stick to the rest of your opinion on the burden EAL on Eritrean people in the long run, I am left with one opinion and that is ONLY TIME WILL TELL.

On my part I am more than prepared to give the airlines a benefit of doubt based on the following simple reasons:

---In my opinion EAL is not a startup airline as its ground facilities were capable in hosting various airlines during the past several years and depicting the airlines as one that started from scratch might lead to wrong conclusion in analyzing the costs involved.
--- The deportation of many former Ethiopian airlines employees came as blessing in disguise to Eritrean airlines and the dedication and voluntarism of those employees will be a definite asset for the airlines. The airline is blessed with few but experienced captains, ground technicians and stewardess/flight attendant trainers with decades of experience. So it is natural for the airline to dare to fly and taste the skies. Of course, it will create unparalleled employment opportunity in the nation. The leaders of the airlines seem to have ambitious programs like setting up an aviation school which will cultivate future leaders in the industry. The same people who greatly contributed to the success of Ethiopian airlines are leading the Eritrean airlines and I don't have any doubt that they will repeat same success on their home front.

---I tend to believe that EAL will have significant monopoly on the "Ethnic" market that will definitely offset the money spent in acquiring the first airliner and help the airlines to carefully grow. (Please read Eritrean Airlines status report below which popped up on my screen from Dehai as I was jotting down this response to your feedback).

Having its own airlines will definitely help Eritrea to be taken seriously by foreign investors. I remember during initial stage of Ethio-Eritrean conflict, expatriates who used to reside in Eritrea were left in pandemonium due to the refusal of foreign airlines to fly to Eritrea amid the threat of the weyanes to shoot any airplane destined to Eritrea. God forbid, if such incident takes place in the future, Eritrea will not be faced with such embracement because it owns its own airlines. The other sad story then was the story of an industrious Israeli business man who was forced to feed cattle with his beloved flowers, which he nicknamed them as "wind flowers" indicating the flowers were grown in "Addi Nefas", that were destined to European markets but he couldn't export his product due to the disruption of airline service in the country. I am sure future investors will not be intimidated by the sad scenario faced by the Israeli horticulturalist as the nation is a proud owner of its own airlines. Since your latest articles are devoted to the potential risks if the airlines decides to stay for long haul, you may need also to take into consideration the prediction of Carl Hodges, the father of Eritrea's sea farm, who is predicting to export 100 million dollars worth of shrimp in less than a decade period of time, could give a lucrative business to EAL to strengthen its cargo division. Of course in addition to the marine products, there is promising future for Eritrean agro-industries to export their products to worldwide markets. The convenience and facilitations that EAL provides will definitely have a far reaching positive impact on host of export-oriented industries in Eritrea. You see, yosief, sometimes, it is also imperative to see the essence for Eritrea owning its own airlines beyond a dollar and sense reasons.

Dear Yosief- those are my personal understandings in seeing the cup half-full rather half-empty. However, by this I don't mean the business is risk free. In fact, PIA himself highlighted the risks involved in venturing into such big projects but he voiced his optimism by citing that with careful planning, the airline could have bright future. Your risk analysis in the long term are well taken but in my opinion, any business venture has its own risks .However personally I am prepared to give it a benefit of doubt by citing the above mentioned reasons. Until, then let's hold our breath until the airlines celebrates its first anniversary. If your risk analysis proven to be right, I don't think it is difficult for the EAL to return the couple jets to their owners and resume its activity as airlines without wings -only offering its ground services. However, IMHO, if it maintains the small but beautiful motto, it will continue to have a bright future and the initial report from EAL seems to indicate to that direction.
To sum it up, I am sure many of the issues you raised on your rebuttal to my feedback to your articles refer to A/Professor Abebe rebuttals to your numerous articles regarding the airlines. As a person employed full time in the airline business, I am sure the professor could address your claims more efficiently than those of us who are throwing our lay man opinions. On my part let me conclude it this way, since we are embarking in predicting the future of the airlines, let's allow time do the magic and give the airlines the benefit of doubt. Give them a chance and we can revisit the topic at least when we see the first quarter report from the airlines. Because, we can talk ad infinitum entertaining the ifs and buts flying around EAL.

Thank you, Yosief.

Million s.

Eritrean Airlines Status report

TO ALL ERITREANS AND ERITREAN AIRLINES CUSTOMERS IN THE UNITED STATED

As you all are aware, Eritrean Airlines has started its operation as of April 17, 2003 to Frankfurt, Rome Amsterdam and Nairobi with B767-300ER with almost 98 percent on time performance and with 100pct Eritrean cockpit and cabin crews.

Needless to say how challenging it is to start an Airline at this time when most Airlines are having difficulty, but our major asset or strength being the most loyal and supportive Eritrean ethnic market gives us much confidence than others. On our side we are trying to address this market on a top priority basis. This market being seasonal, we are targeting the Eritrea.

Now, the good news that we have for our customers in the United States is the agreement we concluded with Delta Airlines which enables them to board from any of the 75 Delta Airlines U.S points with a single Eritrean Airlines ticket via Frankfurt, Rome and or Amsterdam to Asmara. Their baggages will be checked straight through to Asmara their baggage allowance being on piece basis be it to or from Asmara. In addition we have appointed an Eritrean Traffic and Sales Coordinator to assist our passengers while transiting Frankfurt airport. Similar arrangement will be made in other Stations. I am sure this is a big relief to our customers as is to us as an Airline.

We are also negotiating for similar arrangement with Continental and United Airlines which we hope to have it finalized in few days time. Our negotiation with KLM and North West airlines is also on its final stage and hope to have it concluded before end of May.

For our Customers in the United Kingdom and Scandinavian countries our agreement with SAS is scheduled for 3rd week of May too.

At this stage, passengers traveling from the U.S on Eritrean
Airlines/Delta Airlines can purchase their Eritrean Airlines tickets from or through one of our Appointed Agents in the U.S namely Omega (Seattle), Global Discount(Maryland), Net tours (Houston) and Eyes of the World Travel (Los Angeles).
In about ten days time we are planning to have Travel Agents meeting in Washington DC to see on how to expand our Travel Agents outlet in the U.S and also to discuss on how best we can work together and serve our customers yet better whom we never forget they have a choice.

As for reservation system, while our Host CRS system is Gabriel, we have just concluded agreement with Amadeus, World Span, Galileo and Apollo to facilitate all Travel Agents selling our flights from wherever they are through their favorite reservation system.

We know as a new starting Airline we have a lot yet to do, but all we can say at this time is just give us a chance with your support and understanding we will make it work and fast too.

Another good news that we have for you all is, as of May 26, 2003,we will be starting new service to MILAN which will enable us to serve the Italian market from both Rome and Milan. For more details please watch for our next schedule announcement.

By the way we hope you liked our new logo and theme "BRINGS PEOPLE TOGETHER"

We look forward seeing you all in one of your very own flights.

Cordially,
Mebrahtu Habte