LAM - Linhas Aéreas de Moçambique (TM, Maputo) has suspended its only intercontinental route to Lisbon and regional routes to Harare International in Zimbabwe and Lusaka in Zambia, blaming accumulated losses on the routes totalling USD21.3 million, airline representatives told a news conference in Maputo on February 18.
Spokesman Alfredo Cossa told reporters the airline was also reevaluating the future of its Maputo-Cape Town International route, according to The Mozambique Times. This is operated with a CRJ900 wet-leased from CemAir (5Z, Johannesburg O.R. Tambo), one of two of the type on ACMI contracts from the South African operator.
The Lisbon route, Cossa explained, had been running at a USD21 million loss since it was reintroduced in December 2023 after a 13-year hiatus. LAM had operated it with an B767-300ER and, before that, a B777-200ER, both wet-leased from euroAtlantic Airways (YU, Lisbon), but the service has experienced delays and flight cancellations over the past few weeks, presumably due to late lease payments. The route was reintroduced with heavily discounted promotional fares under the oversight of Fly Modern Ark (Johannesburg O.R. Tambo), which temporarily took over the airline's management in April 2023.
"We were feeding this route based on funds from the domestic market. We were producing and paying, and now we can no longer cope," Cossa was quoted as saying by Portugal's Lusa news agency.
The cancellation of the Lisbon route comes as no surprise, as the airline has been reviewing its viability for months. In November 2024, former CEO Americo Muchanga told ch-aviation that the intercontinental service was straining the airline financially, and that the state-owned carrier would be operating profitably without this service. He said the Lisbon flights were operating at huge losses and were being subsidised by the airline's domestic and regional operations. This had emerged from a review of all of the airline's operations - domestic, regional and intercontinental - to better understand its cost structure.
Muchanga also said under the ACMI contract, LAM paid for a minimum of 200 flight hours per month, regardless of actual usage. Continued promotional fares on the route also contributed to the losses as they did not cover the fixed costs of flight operations including fuel, catering, ground handling, and overflight and airport fees, he said.
"A new business dynamic"
Meanwhile, LAM's flights to Lusaka and onwards to Harare have been running up losses of USD307,000, according to Cossa. The route is operated by LAM's subsidiary MEX - Mocambique Expresso (MXE, Maputo) with its only active E145, C9-MEH (msn 145294). ADS-B data shows the last rotation Maputo-Lusaka-Harare-Maputo was operated on January 5, with another rotation Maputo-Quelimane-Lusaka-Maputo on January 12.
Cossa said the decision to axe them was made as part of restructuring efforts to improve profitability as they were not financially viable. The airline plans to focus on more profitable domestic routes and improve management efficiency.
"The suspension of international routes reflects LAM's commitment to implementing a new business dynamic to enhance profitability and management efficiency," he explained.
The restructuring comes amid ongoing financial difficulties for LAM, exacerbated by rising operational costs and declining demand on international routes.
The Mozambican government is preparing to sell 91% of its shares in LAM to public companies in a bid to improve its financial sustainability. It has also launched an international fleet renewal tender, having pre-selected 14 companies that have been invited to present financial proposals by March 5 for three E190s and four B737-700s.
