Game Change: A New Airline Just Placed Africa's Largest-Ever Aircraft Order
An unheard of Nigerian Airline has just placed an order for 100 Boeing 737 MAX aircraft, making it the biggest-ever order for aircraft placed in Africa.
Boeing has announced that Green African Airways has committed to ordering 100 737 MAX 8 aircraft. Half of the orders are firm while the other 50 planes are being ordered as options, which will allow the airline to purchase the additional aircraft in the future at an agreed upon price.
The deal is currently worth $11.7 billion, and it's worth nothing that this is for an airline that doesn't own a single aircraft or has ever operated a single flight. Green Africa says it will be a "value airline" based in Lagos, Nigeria — noting that it's already received its air transport license from the government.
"Today is a historic day for the Nigerian and African aviation industry," said Babawande Afolabi, Founder and CEO of Green Africa. "This landmark deal takes us much closer to our long-held dream of building a world-class airline that will unlock a new realm of positive possibilities for millions of customers."
We've written plenty of stories regarding African airlines announcing their big plans to buy new aircraft and start transatlantic routes, however we usually find out months later that their ambitions were far too grand and that they'll start at much slower pace, or not at all.
What makes this announcement different is that the company is helmed by some aviation heavyweights, including Tom Horton, former chairman and CEO of American Airlines — currently the world's largest carrier. Horton, who also formerly chaired the Oneworld alliance, is joined by William Shaw, founder and former CEO of VivaColombia, and Virasb Vahidi, former CCO of American Airlines.
"Nigeria is uniquely positioned to be the home of the next major value airline," Vahidi said in a statement. "The strategic partnership with Boeing positions Green Africa Airways to expand and improve air travel for customers in Nigeria, and further strengthens the relationship between the United States, Nigeria and Africa."
Nigeria's aviation market is ripe for growth as there's a relative dearth of carriers in the country, Africa's most populous (Lagos, the capital, is home to more than 16 million people). Still, many airlines have had issues turning a profit in the country that's notorious for corruption.
The airline first wants to develop its foothold in the domestic Nigerian market and then build out its presence throughout the African continent. It will do so with the 737 MAX 8, a single-aisle aircraft that can seat up to 178 passengers and fly up to 3,550 nautical miles. From Lagos (LOS) the MAX 8 can reach destinations around the entire African continent like Cape Town (CPT) and Addis Ababa (ADD), and even large European hubs like Frankfurt (FRA) and London (LHR).
While Green Africa won't have much domestic competition, once it starts expanding to international routes, it will go up against Star Alliance carriers like Ethiopian Airlines, South African Airways, EgyptAir and soon to be Oneworld member Royal Air Maroc. Ethiopian has been investing in other regional African airlines, including in Chad and Zambia.
Boeing says Africa will need nearly 1,200 new aircraft over the next 20 years to meet its growing demand for travel. If Green Africa is successful, its possible the airline will order more jets, including long-haul widebodies, so it could reach more distant cities.