Why Achieving Profitability in Aviation Takes Time and Determination – A Lesson for Ugandans

For Ugandans envisioning a national airline soaring proudly across Africa and beyond, the recent announcement of Kenya Airways’ first profit in 11 years revealed in March 2025 offers a spark of hope. After over a decade of consistent losses, the Kenyan national carrier posted a net profit of 5.4 billion Kenyan shillings (about $41.7 million USD) for 2024. While this “historic” turnaround is commendable, it also underscores a sobering reality being that the aviation is an unforgiving, capital-intensive industry. For Uganda, which lacked a functioning national airline from the collapse of Uganda Airlines in 2001 until its 2019 relaunch, the path to profitability will likely be just as long and demanding. Here’s why turning a profit in aviation is a marathon, not a sprint and what Ugandans should know before investing hope and resources into the skies.

Launching and running an airline is exorbitantly expensive. Just acquiring aircraft is a massive undertaking for a single Boeing 737 can cost upwards of $100 million to purchase or several million annually to lease. Fuel costs alone account for 20% to 30% of operating expenses and fluctuate with volatile global oil markets. Add to this salaries for pilots, cabin crew, maintenance technicians, and ground staff, along with airport fees, insurance, and servicing costs, and it becomes clear that billions of shillings are required just to get off the ground.

On the revenue side, ticket sales are closely tied to factors beyond an airline’s control ie. tourism, economic health, and business travel. Competition is stiff. Industry giants like Ethiopian Airlines and budget carriers keep fares low, shrinking margins. Uganda’s domestic market is relatively small, with a population of 47 million and a GDP per capita of about $1,000. Filling aircraft consistently, especially on long-haul routes, is a long-term task. Kenya Airways carried 5.23 million passengers in 2024, thanks to years of route development and infrastructure investment.

Globally, aviation has often been a loss-making business. According to the International Air Transport Association (IATA), airlines have cumulatively lost more money than they’ve earned over the last century. Even when profits appear, they’re typically thin—ranging between $5 and $10 per passenger. Kenya Airways’ 11-year stretch of losses isn’t an anomaly. Italy’s Alitalia collapsed in 2021 despite years of government bailouts, and South African Airways has faced chronic financial issues. Even Richard Branson once quipped, “The quickest way to become a millionaire is to start as a billionaire and buy an airline.”

Kenya Airways’ recent profitability offers both hope and caution. Much of its 2024 success is attributed to a stronger Kenyan shilling, which helped reduce the burden of dollar-denominated debt. Operational revenue only rose by 6%, suggesting the profit was more a result of financial shifts than business transformation. Since 2013, the airline had consistently operated at a loss, relying heavily on government bailouts like the 2017 takeover of its loans to reduce debt pressure.

The COVID-19 pandemic grounded planes worldwide, inflicting $137 billion in airline losses in 2020 alone. Conflicts, recessions, or supply chain delays (e.g., aircraft parts) compound risks. Kenya Airways weathered some of these storms thanks to its Nairobi hub and alliances with global carriers like Delta. 

Despite the risks, a national airline holds symbolic and strategic value. It’s not just about profits, it’s about sovereignty, connectivity, and economic opportunity. For Uganda, a homegrown airline means direct links to trade partners, easier tourist access to treasures like Bwindi’s gorillas and the Nile, and enhanced export capacity for goods like coffee and flowers. This could translate into thousands of jobs, infrastructure development, and enhanced global presence. 

The key takeaway for Ugandans is this: success in aviation doesn’t come quickly or cheaply. Kenya Airways took over a decade of losses and strategic restructuring to reach its current position. One thing is clear: those hoping for quick wins in the aviation sector should prepare for a long-haul flight.