Mango faces grounding this week as it’s hit by financial crunch: report

State-owned domestic airline Mango says that it cannot pay staff salaries, raising questions about how much longer it can stay in the air.

The airline’s financial issues have been exacerbated by delayed funding from government, with the Department of Public Enterprises meeting with Mango’s board this weekend about repositioning the airline, BusinessDay reported.

The delay in funding means that the airline will need to stop operating from 1 May – and enter into business rescue.

A Mango spokesperson said that the airline is expecting some of the R10.5 billion set aside for South African Airways (SAA), but that will require a special appropriation bill, which has not yet been tabled in parliament.

This is the second state-owned airline to be hit with financial problems in as many years, with SAA entering into business rescue in December 2019.

SAA has been unprofitable for almost a decade, surviving on state bailouts and government debt guarantees, and was placed under administration a year ago. The carrier has been lying dormant since March 2020, when the fleet was grounded due to travel bans to contain the Covid-19 coronavirus.

However, SAA’s new interim chief executive Thomas Kgokolo said that the embattled national carrier has begun official discussions to resume operations.

In an interview last week, Kgokolo said that the airline will soon start the process of retraining its pilots and ensuring that compliance requirements are met.

He added that a number of expenses have been cut down, including employee costs through retrenchments, meaning that the new airline will be significantly ‘leaner’.

However, Kgokolo acknowledged the difficulties in restarting the airline during a global pandemic which has caused untold damage to the airline sector.

“Our view is that we are much smaller than before, so we are going to be spending a lot of time (as part of) our restart plan looking at operational efficiency from a cost perspective.

“We will also be looking at the type of aircraft we use going forward to ensure that they are fuel-efficient. We will also (launch) a decent marketing campaign to ensure that as we come back online our loyal customers can use us again.

Kgokolo said that this restart will not be easy and that the new SAA will not do things the same way it did in the past.

Read: ‘New SAA’ plans to restart operations

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Mango faces grounding this week as it’s hit by financial crunch: report