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Mohamed Frikha ruffled feathers when he launched Syphax

Airlines two years ago and, as Martin Riversdiscovers, the

chairman is intent on shaking up the Tunisian market further.

Syphax figuresout the way aheadI

n an aviation market as heavily regulated asTunisia, Mohamed Frikha, the founder andchairman of Syphax Airlines, fully

anticipated that his start-up would encounterpush-back from existing players when itlaunched in April 2012.

Sure enough, on the very first day ofoperations at Tunis Carthage InternationalAirport, Syphaxs passengers were turned awayby staff from the ground-handling division offlag-carrier Tunisair.

The debacle marked a rocky start for thefledgling privately owned airline, and it was notto be an isolated occurrence.

Over the months that followed Tunisairsformer chief executive, Rabah Jrad, repeatedlyaccused his competitor of illegal and unfairbusiness practices. Though undoubtedly a

headache, this opposition ultimately failed todeter Frikha from injecting competition into thesector.

Syphaxs fleet now stands at three aircraft(two Airbus A319s and one A330), and it hasorders for three current-generation A320ceosplus three under-development A320neos.

The airline operates scheduled flights fromfour Tunisian cities mainly Tunis and Sfax, butalso Monastir and Djerba to Istanbul, Jeddah,Tripoli, Sabha, Paris and Montreal.

An extensive charter network also keepsutilisation high, but Frikha said the carriersexisting operations barely scratch the surface ofits long-term vision.

Our target is to arrive at 15 aircraft around2018, [serving] two million passengers, saidthe chairman, who became one of Tunisias best-known businessmen after founding the multi-sector IT firm Telnet Group in 1994. We willtake two of the [current generation] A320s in2015, and another in 2016. We will lease asecond A330 in 2015. Then we will lease moreA320ceos after that.

Asked about future network growth, he saidthe airline would develop in three regions:Africa [both] north Africa and the sub-Saharan countries; Europe; and long-haul Asia, North America and South America.

Expansion will initially be focused on Europe,

where Syphaxs varied charter operations havecontinuously been put to work testing marketpotential.

Non-scheduled services to cities like London,Brussels, Lyon and Zagreb have already provenpopular with customers, but Frikha said no firmdecisions have been made and evaluations wereon-going across the continent.

We want to work on Germany, Belgium, Italy,Spain, England, he noted. Our project is totransfer these charter flights into regular flights,so we are looking at many different networkscenarios, and we will soon announce our newnetwork for the next three years.

A more complicated picture emerges inAfrica, where Tunisias own experience ofprotectionism is a continent-wide problem.

Although west Africa has always been in thebusiness plan Frikha singled out Cte dIvoireGabon and Nigeria as the prime targets

securing designations on both ends may not bestraightforward.

Air Arabia chief executive Adel Ali has longcomplained of regulatory intransigence over hisefforts to link up Morocco with west Africa, andthe Tunisian Government is likely to be just asuncooperative especially since Tunisair servesfive points in the sub-region. Nonetheless,Frikha is focused on the long-term and sees cleapotential in connecting west Africa with Europevia Tunisia.

In the beginning, it [west Africa] will bepoint-to-point, he explained. But our strategyis to develop the three regions Africa, Europeand long-haul [so that they are] all feeding into

Tunisia.For North Africa, charter services have againbeen used to test the water before rolling outregular flights. Casablanca in Moroccocontinues to be operated on an ad hoc basis,while the Libyan cities of Tripoli, Benghazi andSabha quickly matured into scheduled points.Unfortunately civil unrest across the border hassince grounded those services, with both ofLibyas main international gateways closed dueto fighting.

Frikha stressed that Tunisias neighbour to theeast is a very important market for Syphax aevidenced by its earlier decision to serve thecapital from all four bases but Libyas volatileand unpredictable security situation remains anoperational challenge.

If we can fly, we fly, he said. Sometimes wehave to cancel flights. We always make surethere is contact there and we watch the situationWe coordinate with the Tunisian Civil AviationAuthority, and if it is necessary we stoptemporarily.

Further afield, the long-haul side of thebusiness is also beginning to take shape. InApril, Syphax launched weekly flights fromTunis to Montreal. Load factors on the routestarted at about 50% but were forecast to reach80-85% this summer, so Frikha was eager to admore points. Beijing will become the next long-

I hope that we are complementary to

Tunisair. It depends on them. On someroutes there is not a lot of demand, soyou need only one company. But there

are also larger routes where I think wecan work together.

MOHAMED FRIKHA

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haul destination in November, he confirmed,followed by New York in 2015 and then eitherRio de Janeiro or Sao Paolo in 2016.

The arrival of the second A330 next year willenable much of this growth, with Syphax leasingthe aircraft for five years from Airbus. Butfurther antagonism by Tunisair cannot be ruledout.

Asked about Jrads claim that Syphax enjoys

anti-competitive advantages, Frikha chose hiswords judiciously. He had previously accusedthe flag-carrier of hypocrisy, telling local mediathat state-owned entities were far more likelythan private companies to benefit from specialprivileges. But on this occasion the chairmanopted for a more conciliatory tone.

I hope that we are complementary toTunisair. It depends on them, he insisted. Onsome routes there is not a lot of demand, so youneed only one company. But there are also largerroutes where I think we can work together.

Protectionism for loss-making Tunisairremains a potent threat to Syphax, manifestingitself in several different ways. As well as facingdifficulty in securing route designations, thestart-up must contend with restrictions over thetypes of aircraft it can legally deploy.

Right now we are not allowed to do regional[aircraft] flights, Frikha complained, notingthat Tunisair Express has a monopoly on suchservices with its mixed ATR and Bombardierfleet. I think it is very important for us to doregional flights to feed our international flights.If the law changes and we have the capability todo this, we can purchase other kinds of aircraft.

Forced at gunpointSyphax has approached the government aboutthe subject, but Frikha predicted that any talkswould fall under the wider banner of open skies a line of discussion that has failed to gaintraction in recent years. Although in theory openskies should promote traffic growth, thegovernment is understandably reluctant to takesteps that might hasten the demise of itsstruggling flag-carrier.

Overturning the restriction on regionalaircraft, therefore, might not be a priority forFrikha, who also has his eye on mutuallybeneficial goals, such as securing infrastructureupgrades.

Enfidha Hammamet International Airportstands out as one target for lobbying. Thegateway, opened in 2009, is currently used by

Syphax for charter flights. Although Frikhadescribed it as a very nice airport, he warnedthat communication systems were a problemat the base and further investment was neededbefore its full potential could be realised.

Partnerships make up the final piece of thepuzzle.

Syphax is already seeking an interline orcodeshare deal for its Canadian route, and

Frikha hopes to unlock synergies elsewhere inhis fast-expanding network.The chairman gave his interview at the

International Air Transport Association (IATA)annual meeting in Doha the first time theindustry groups AGM had been held in the GulAsked if Syphax is ultimately pursuing the samemega-hub strategy as Qatar Airways, Frikhastressed that a region like north Africa wasbetter suited to a cooperative model.

I think we should speak about the Maghreb,not just Tunisia, he responded. In the Gulf,you have Emirates, Etihad, Qatar. In Europe,there are also big companies. So I think theairlines of the Maghreb should make an alliance RAM, Algerie, Afriqiyah and that will be vergood for the region. With an alliance, we will allbe stronger.