Bilateral restrictions have traditionally been a major barrier to new air services in Africa. Despite this, Fly540 has plans to take its low-fare model and bright orange livery from East to West Africa.

Lonrho, the international conglomerate with infrastructure and logistics businesses in Africa, owns 49% of Fly540, with varying stakes in the carrier's subsidiary brands, whose hubs are set up locally with joint-venture partners (thereby getting past the tough bilateral restrictions).

Geoff White, Lonrho's director and CEO told Routes News why he believes now is the time for an expansion in the continent: "Africa is approaching one billion people so the market is massively strong. The vast majority of traffic in the country is non-discretional - people travel because they have to and often the only way to get from A to B is by air."

The airline operates a fleet of ATR turboprops and a recently acquired CRJ-100/200 jet aircraft.

Fly540's subsidiaries

Fly540 Kenya

Fly540 is now the second biggest carrier in Kenya, based on weekly frequency. The flag carrier, Kenya Airways, has a 41% market share of all operations from Nairobi. Fly540's schedule from Nairobi includes 10 destinations and 117 weekly flights, highlighted below:

Source: Flightbase (June 14-20, 2010)

Fly540 has quickly established itself as an important player on the trunk route between Nairobi and Mombasa. For example, over 490,000 passengers flew this sector between December 2008 and 2009. Fly540 handled 70,000 of those passengers, while Kenya Airways handled just under 350,000 (source: IATA BSP DATA, Airport IS).

Fly540 is able to serve these thinner markets, whereas Kenya Airways operates just two types of narrow-body aircraft - B737s and Embraer 170s.

Fly540 Tanzania

Fly540 received its AOC for Tanzania last year and is now the second largest carrier in the country, operating 112 weekly flights to six points, resulting in an 18% market share. Only private Tanzanian carrier Precision Air operates more services using its fleet of ATRs and one Boeing 737-300. The absence of a strong national carrier has also helped Fly540 grow in Tanzania.

Fly540 Angola

Entering its next expansion phase, Fly540 plans to establish a regional hub in Angola, which is sure to stimulate demand in this oil-rich country.

On average, Fly540 transports 40,000 passengers in its Kenya and Tanzania operations each month and this is expected to almost double with the new hub in Angola, which should be up and running in the next few months, White said.

He explained the carrier's long-term objective to Routes News: "As well as building a pan-African regional airline with key markets connecting the north, east, south and west of Africa, we see a synergy where we can offer a regional distribution centre for other major inter-continental carriers."

Major airlines are already taking advantage of opportunities in Angola, with a number of major carriers either launching or increasing service to the country in recent months, including Emirates, British Airways and South African Airways.

Fly540 Ghana

Fly540 plans to open a West African hub in Ghana, which White says will then ensure that the carrier's network is linked east to west and north to south.

A fleet expansion is also underway, with two brand new ATR-72-500s being purchased for the new operations in Angola and Ghana.

White concludes: "There is a huge opportunity to build a first world regional carrier to link the networks together. The long-term plan is to be flying in 18 countries by the end of 2012."