Air Zimbabwe Refere Three Options to Local Passengers

EMBATTLED national airline, Air Zimbabwe, which is struggling to service its routes is now booking passengers on buses to some of their local trips, it emerged this week.

Scores of passengers who were scheduled to fly to Bulawayo on Sunday were left stranded after their flight was cancelled at the last minute due to operational challenges.

In a telephone interview on Monday, a spokesperson for Air Zimbabwe, who refused to disclose her name confirmed the cancellation of the flights and said they gave passengers three options.  The first option was to be booked in a bus that was supposed to leave Harare on Monday afternoon, the second one being to be rebooked for a Wednesday flight, while the last one was to have the passengers' money refunded.

"Our flight to Bulawayo on Sunday had to be cancelled due to operational challenges and we had to give the passengers three options.

“Those who were in a hurry were asked to use a bus on Monday afternoon, while others had their flights rebooked for Wednesday. Those who felt hard done by the move will have their money refunded," said the spokesperson.

One of the affected passengers, Mutare businessman Mr Isau Mupfumi, who was scheduled to fly to Bulawayo to attend to pressing commitments at his Senatar Tours, said  he was surprised to be told that the flight had been cancelled when he was  already at the airport.

"This is so inconveniencing because we had already made plans for meetings in Bulawayo, only to be told that the flight had been cancelled. When flights are cancelled the service provider usually pays for the passengers' accommodation while they wait for the next flight and this did not happen after Sunday's flight cancellation.

"Some of us we are in the public transport business and it was an insult for Air Zimbabwe to ask us to use buses to travel to Bulawayo. I could have even looked for the most comfortable bus among my fleet to take me to Bulawayo, but we opted to support our national airline, only to be repaid through this kind of service," complained Mr Mupfumi. Some of the passengers going to local routes like Bulawayo and Victoria Falls are first travelling to Johannesburg in South Africa and reconnect back to Bulawayo and Victoria Falls due to Air Zimbabwe's inconsistence.

Most passengers who opt for refunds have to wait for a little longer to have their money as the national airline takes time to avail the refunds.

"We do not pay refunds there and there and that is why we usually try to rebook our passengers in the next available flight," said the Air Zimbabwe spokesperson.

Galileo International threatens to withdraw its franchise from Air Zimbabwe

Galileo International has threatened to withdraw its franchise from Air Zimbabwe Holdings, a move that could paralyse the airline's operations, The Sunday Mail Business reported on Sunday.

Galileo Zimbabwe was established in May 1998 as a division of Air Zimbabwe as a result of the distribution agreement entered into between Air Zimbabwe and Galileo International.

In 1999, Galileo Zimbabwe became Galileo Zimbabwe (Private) Limited, a wholly owned subsidiary of Air Zimbabwe, after registration with the Registrar of Companies in Zimbabwe.

Galileo Zimbabwe distributes a computerised reservations system (CRS) service to travel agents in Zimbabwe as its core business.

A CRS is an automated system which processes booking data.

Documents in possession of this paper reveal that Air Zimbabwe's acting chief executive, Mr Innocent Mavhunga, recently wrote a letter to the Permanent Secretary in the Ministry of Transport, Communications and Infrastructural Development, Mr Patterson Mbiriri, informing him about the development.

"Galileo International (Travelport) has threatened to terminate the distribution agreement and in its place wants to form a company to take over the functions of Galileo Zimbabwe.

"Travelport wants to terminate the agreement so that they can take over the Galileo Zimbabwe function through the company they are forming with some Zimbabweans who are being used as fronts for Travelport, while they are effectively in control," read part of the letter.

The termination of agreement will negatively affect revenue inflows at the beleaguered airline and loss of market share as travel agents who were on Galileo will no longer support Air Zimbabwe as is the case with the current set-up.

The letter further states that: "It should be recognised that the NDC (Galileo Zimbabwe) generates strategic funds which have been used to pay Air Zimbabwe's distribution costs.

"Without these funds the airline will not be able to pay the Galileo Worldspan distribution costs, which will result in the airline being cut off as had happened with Amadeus."

Air Zimbabwe further states that Galileo International has in the past tried to take over Galileo Tanzania and Galileo South Africa without success.

However, the letter notes that Air Zimbabwe has since met with Galileo International's vice-president for Southern Africa over the issue and they indicated that they were not agreeable to any suggestions that will see them not withdrawing the franchise.

"They want (Galileo International) an arrangement where they are in the driving seat and in total control of NDC," wrote Mr Mavhunga.

Air Zimbabwe had suggested that they share the commission on a 20-80 percent ratio with 20 percent going to the NDC to cover running costs while 80 percent goes to Galileo International to cover Air Zimbabwe's distribution costs.

Efforts to get a comment from Mr Mbiriri proved fruitless as he was said to be out of the country.
Sources allege that serious divisions have surfaced with counter accusations within Air Zimbabwe management of trying to sabotage the State-owned enterprise.

"A storm is brewing at the airline with counter accusations amongst the management. Recently there was a public fallout between the two general managers accusing each other of trying to act on behalf of Galileo International, violating indigenisation regulations.

"There is also a mass exodus of people at Galileo Zimbabwe and they have since been roped in by the new company.

"A marketing manager at Galileo has already signalled her intention to resign in anticipation of the formation of the new company although the real mastermind is alleged to be the former general manager of Galileo," added the source.

Statistics contained in a 2009 report by the Zimbabwe Tourism Authority on tourists showed that five of the major airlines serving Zimbabwe — Air Zimbabwe, South African Airways, British Airways-ComAir, Air Namibia and South African Airlink — take up 93 percent of the airline market share in the country.

The report also notes that the market share for Air Zimbabwe fell by 11 percent in 2009, which saw South African Airways taking over the leading position in terms of passenger market share in the country.

The airline has in recent years grounded several aircraft because they were no longer worth flying and scaled down on the number of flights per week to rationalise operations and contain ballooning costs.

Biti rejects Van Hoogstraten Air Zimbabwe bail-out

FINANCE Minister Tendai Biti last night shot down a plan by Air Zimbabwe to borrow US$2 million from “loan shark” Nicholas Van Hoogstraten, declaring: “Over my dead body.”
“As long long as I live, this government will not borrow money from any individual, and that includes Mr Van Hoogstraten,” Biti said, a week after it was revealed that the struggling airline had taken its begging bowl to the controversial British property tycoon.
“For all I care, Mr Hoogstraten can go and throw himself in the River Thames but we will not sanitise his nefarious activities. Let him try his luck elsewhere, not from this ministry. Over my dead body!”
Hoogstraten revealed last Friday that he had over the years extended “small short term emergency loans” to Air Zimbabwe at no interest. In the latest request from the airline, he said, Air Zimbabwe was seeking US$2 million to pay-off the International Air Transport Association (IATA).
IATA suspended the cash-strapped airline earlier this month over a US$280,000 debt which the aviation control body insists must be paid, plus a whooping US$1,7 million deposit – being penalty for defaulting -- before it can be restored on its worldwide financial and flight booking service.
Hoogstraten said: “It is correct that I have been asked by Air Zimbabwe’s London office for a US$2 million loan which I have agreed to subject to Minister Biti personally signing the acknowledgment of debt agreement.”
Van Hoogstraten would have known his conditions were unlikely to me met, his comments coming barely a week after Biti accused him of corrupting the country’s financial services.
Biti said struggling financial institutions were now at the mercy of “two loan sharks — one of Indian descent and the other British” in clear reference to Jayesh Shah and Van Hoogstraten.
Van Hoogstraten shot back: “I do not advertise loans –– institutions and companies come to me as I am generally known in the market as the ‘lender of last resort’. This is similar to my situation in the UK where I have been a financier since my late teens.
“I have been the single largest investor in the Zimbabwean financial market and currently have Zimbabwe Stock Exchange-quoted holdings with a value of well over US$250 million.
“As for being a loan shark, apart from a few relatively small personal loans, all loans I have made are of a 30, 90 or 180-day tenure to financial institutions at market rates of between 16% and 24% per annum with no fees.”

Hoogstraten, 64, briefly returned to Sussex, England, last year to chase up money owed by several local businesses, including a doctor’s surgery which was temporarily forced to close over a £30,000 debt.

Once heralded as Britain's youngest millionaire, Hoogstraten has never made any secret of his robust approach to business.

During one of his many court appearances in Britain, a judge described the tycoon as a "self-styled emissary of Beelzebub".

From an early age he aspired to be what he calls a "quality person" and was a great fan of Margaret Thatcher because she made him "proud to be English".
He left school at 16, joined the Royal Navy and travelled the world. Just a year later, he sold his astutely acquired stamp collection for £1,000 and embarked on a business career, buying property in the Bahamas.
Now he is believed to have homes in Barbados, St Lucia, Florida, Cannes and Zimbabwe.
He has spoken warmly of President Robert Mugabe, whom he once described as "100% decent and incorruptible".

He holds vast fortunes in Zimbabwe and once said: "I don't believe in democracy, I believe in rule by the fittest."

Hoogstraten is no stranger to controversy and his list of previous convictions includes ordering a grenade attack on the home of a business associate, a Jewish clergyman who he claimed owed him money.  For that, he spent four years in Wormwood Scrubs prison in the 1960s, but he would later face much more serious charges.
In 1999, Mohammed Raja, 62, was shot dead by two men identified as Hoogstraten's henchmen, but the tycoon's conviction for manslaughter was quashed by the Court of Appeal in July 2003 and he was freed five months later.
Following his release from prison, Raja's family brought a £6m civil action against him. The civil courts - where the standard of proof required is much lower than the criminal courts - ruled that on the balance of probability, Van Hoogstraten was involved in the murder.
High Court judges ordered him to pay £500,000 interim costs but the businessman was typically defiant and stated that Raja's family would "never get a penny".
Van Hoogstraten also hit the headlines during an ugly spat with ramblers over a public footpath through the grounds of the enormous mansion near Uckfield in East Sussex.
Called Hamilton Palace, after Bermuda's capital, it is neo-classical, with a copper dome. It is estimated to have cost £40m so far and is reportedly the most expensive private house built in Britain for a century.
It is bigger than Buckingham Palace and has a 600ft art gallery and a mausoleum designed to hold Van Hoogstraten's body for 5,000 years. The mausoleum's walls are three feet thick because he said he wanted to "make the building last forever".
Never afraid of a fight, he has described taking on a nun at school. She "tried to whack me with a chair-leg once - I grabbed it and hit her and she never tried again".
In 2008, he was arrested in Harare on charges of illegal currency dealing and possession of pornography. Police who raided his home in Emerald Hill they found hundreds of photographs of naked women in what they said were “indecent poses”. Van Hoogstraten appeared in many of the pictures.
Van Hoogstraten was cleared on the illegal currency dealing charge because police were not able to produce the officer who had allegedly caught him. A magistrate ordered that the tycoon's photograph collection be destroyed.
He was born in 1946 in Shoreham, East Sussex, as plain Nicholas Marcel Hoogstraten - the "van" was added later. His father was a shipping agent and his mother a housewife.
With the profits he made from his Bahama property deals, he moved on to the British housing market, buying six properties in Notting Hill, London, before moving on to Brighton.
By the time he was 22, he was reputed to have had 350 properties in Sussex alone and to have become Britain's youngest millionaire.
But he also gained a sinister reputation and was accused of using strong-arm tactics against tenants of slum properties which he bought cheaply for redevelopment.
In the 1980s, as the housing market boomed, he prospered, acquiring more than 2,000 properties. By the 1990s he had sold 90% of them, making massive profits and investing in other areas, including global mining.
When a fire broke out at one of his properties in the early 1990s in Brighton, he described the five people who died in the blaze as "scum".

To Van Hoogstraten his tenants are "filth", while people who live in council houses are "worthless and lazy".

He once said: "The only purpose in creating great wealth like mine is to separate oneself from the riffraff."

He has also said he believes that "the whole purpose of having money is to put yourself on a pedestal".

Van Hoogstraten has five children - four sons and a daughter - by three different mothers.

He said he is preparing his eldest son Rhett, 20, to take over his empire - which he says is worth £800m.

He declared recently: "I'm still young and fit and I've got a long time to go. I'd like Rhett to shadow me and find out everything that's going on.
"But it's a difficult task because I keep everything close to my chest, nothing's in writing, there are no records of anything."

Air Zimbabwe chairman Jonathan Kadzura quits Air Zimbabwe?

Air Zimbabwe chairman Jonathan Kadzura hangs in the balance as he has reportedly quit the troubled airline amid talk that he had fallen out of favour with Transport minister Nicholas Goche over the recent strike by the airline’s pilots.
Transport minister Nicholas Goche, to whom Kadzura is supposed to have submitted his resignation, could neither confirm nor deny speculation surrounding Kadzura’s tenure.
“You should ask him (Kadzura) on whether he has resigned or not,” he said in a telephone interview yesterday.
Kadzura gave a veiled response to businessdigest’s inquiry: “I haven’t really done that. I have heard that. But you can’t keep such news away from the public.”
However, impeccable sources within the aviation industry said Kadzura had tendered his resignation, but Goche had turned it down.   
The sources said Kadzura threw in the towel as the national carrier’s chair, frustrated that he was bypassed twice during critical meetings to resolve the pilots’ crippling job action.
The sources said the embattled Air Zimbabwe chair, who has witnessed two paralysing strikes within a space of six months since his appointment in 2009, tendered his resignation after government by-passed him and directly struck a deal with the pilots on April 14.
Goche, according to sources, did not accept the resignation although he is understood to have already lined up former Air Zimbabwe acting CEO Oscar Madombwe or ZTA chief Karikoga Kaseke to succeed Kadzura.
Kadzura is said to have fallen out favour with Goche over the manner in which he handled the strike. He was consistently quoted as saying the airline had no cash to meet the financial obligations, a development that is understood to have irked the pilots.
Kadzura, previously vice chairman, succeeded Mike Bimha as chairman after the former chair was appointed Industry and Commerce deputy minister at the formation of the inclusive government two years ago.
Information gathered by businessdigest indicates that at meetings convened last September to save the financially beleaguered airline Captain Courage Munyanyiwa represented the pilots, Patson Mbiriri stood in for
the shareholder (government) while immediate past Air Zimbabwe CEO Peter Chikumba was not party to the meetings.
“They agreed during these meeting that arrears owed to the pilots should be cleared within six months.
Government failed to meet this deadline, which resulted in the most recent strike.  Kadzura was again not actively involved on the negotiations, which could have annoyed him as board chairman. Acting CEO Innocent Mavhunga, Munyanyiwa and Mbiriri instead took part in these negotiations.”
Air Zimbabwe pilots went on a strike on last month  over non-payment of nearly US$3 million in outstanding salaries. The strike, according to the sources, was stopped after the parties agreed government would immediately pay 74% of the arrears, with the remainder being cleared by end of August this year.
Meanwhile, Munyanyiwa is understood to have quit the national carrier amid reports that he has joined a Middle East airline. 

Aviation Experts Commend Air Zimbabwe For Securing New Plane

Aviation experts say Air Zimbabwe has moved in the right direction in securing use of a new Boeing 737-500 from Zambian-based Air Zambezi to update its aging fleet.
South African-based aviation expert Guy Leitch said indications are the plane has been secured on a long lease agreement with cabin crew, pilots and other staff. The state-owned carrier has been virtually crippled by a strike by pilots, engineers and cabin crew.
The striking pilots recently complained to Parliament they are flying outdated planes.

Leitch said that while the new model is more commercially viable, Air Zimbabwe management must put its house in order to achieve profitability.
“While it is commendable that the airline has secured a new plane, it should also address management problems that have led to the current strike," Leitch said.