“While the aircraft acquisition process is underway, it is crucial that transport services continue uninterrupted. Renting one or two planes seems to be a quicker solution, allowing the normal purchase process to proceed,” stated the spokesperson for the Mozambican government, Inocêncio Impissa, following the weekly Council of Ministers meeting held today in Maputo.
On July 31, it was reported that the state-owned LAM launched a tender for the short-term lease of five aircraft to address operational improvement needs. The airline explained that leasing these aircraft is a strategic response to the increasing demand for aviation services both nationally and regionally, driven by major electricity, oil and gas projects, and the tourism industry, as part of its investment plan.
The tender is open to “all interested national and international companies” and will be in effect until August 22. The bidding is for short-term hiring of up to five aircraft, under a ‘wet lease’ arrangement, meaning the aircraft are fully operational, including crew, maintenance, and insurance.
Today, when questioned by journalists, the government spokesperson assured that despite the advanced tender for leasing aircraft, the plan to purchase planes remains: “What we can assure you is that indeed, the aircraft acquisition process is ongoing and what we know is that the acquisition plan is proceeding while LAM itself is being reformed, but at the same time, transport services are provided through interim aircraft, in this case hired for the purpose.”
For several years, LAM has faced operational issues related to a reduced fleet and lack of investment, with some non-fatal incidents attributed by specialists to inadequate aircraft maintenance. The company is now undergoing extensive restructuring.
On June 22, the President of Mozambique, Daniel Chapo, stated that the ongoing restructuring at LAM will extend to various other public sector companies that are not generating revenue for the state.
“The plan is clear that we need, and this process is underway, to make acquisitions [aircraft] for LAM and truly begin to build a robust company that can generate profits and dividends (…). Now, I want to make clear that this work will not end with LAM,” declared the Mozambican head of state.
The Mozambican Institute for the Management of State Holdings (Igepe) announced on May 13 the removal of LAM’s management and the appointment of a management committee led by Dane Kondic.
The decision was made at LAM’s extraordinary general meeting as part of the “revitalization process” of the state-owned airline. A non-executive board was also appointed, comprising representatives from the three state-owned companies that became LAM shareholders this year: Cahora Bassa Hydroelectric Company (HCB), Mozambique Ports and Railways (CFM), and Mozambican Insurance Company (Emose).
Consultant Knighthood Global, also contracted by the shareholders to assist with the restructuring, stated in May that it has three months to “stabilize and reposition” LAM, explaining that it was “appointed by the Government of Mozambique to help revitalize” the airline and “the country’s aviation sector in general.” In June, a tender was launched to hire up to five Boeing 737-700s for the Mozambican airline, with no known outcome to date.
