Alarming trend emerging for flight prices in South Africa
There is an alarming trend of soaring domestic air travel costs in South Africa – but local carrier FlySafair believes that airlines are not primarily to blame for high prices.
The concern of increasingly unaffordable ticket prices prompted the Parliamentary Portfolio Committee on Trade, Industry and Competition earlier this month to call for the Competition Commission to investigate whether local airlines are pricing tickets unfairly.
The move reflects growing public frustration with what many perceive as unaffordable flight prices.
However, a closer examination of the situation reveals that rising costs may not solely result from unreasonable airline practices but rather a confluence of external factors.
FlySafair, one of the country’s leading low-cost carriers, has responded positively to the call for an investigation.
Kirby Gordon, the airline’s chief marketing officer, expressed support for the scrutiny, highlighting the importance of transparency and fair competition in the industry.
He welcomed the Competition Commission’s involvement, stating that it presents an opportunity to shed light on the complex dynamics affecting flight pricing.
Gordon emphasised that while ticket prices have risen relative to the cost of living since the COVID-19 pandemic, this increase reflects significant operational cost pressures airlines face.
One of the primary contributors to escalating ticket prices is the soaring cost of jet fuel.
Gordon noted that fuel expenses account for approximately 50% of an airline’s operating costs.
In the first half of 2022, jet fuel prices surged by 45%, a trend exacerbated by South Africa’s status as a net importer of jet fuel.
With local production unable to meet demand, the reliance on imports introduces additional cost implications, particularly given the volatile rand-dollar exchange rate.
The rand’s strength also plays a pivotal role in determining operational costs across the industry.
Aircraft components, maintenance parts, and crude oil are all traded in US dollars, making the sector highly sensitive to currency fluctuations.
When the rand weakens, airlines face increased expenses for essential imports, driving up the cost of flights.
Adding to the financial strain is a shortage of skilled maintenance professionals within South Africa.
Since the pandemic, many local workshops and machining facilities have struggled to maintain operations, forcing airlines to seek technical expertise overseas.
This not only inflates costs but further ties the industry’s financial health to the performance of the rand against the dollar.
Despite these challenges, Gordon underscored FlySafair’s commitment to providing affordable travel.
As a low-cost airline, its business model prioritises cost efficiency to offer competitive fares.
Unlike full-service carriers such as South African Airways (SAA), which include additional services like meals and checked baggage in their ticket prices, FlySafair keeps its product basic to maintain lower barriers to access for consumers.
Gordon reiterated that the airline remains the least expensive option in the country, striving to balance affordability with the realities of rising operational costs.
Interestingly, the pricing debate has also revealed contradictions within the industry.
Gordon highlighted a recent instance where rival Lift Airlines accused FlySafair of predatory pricing, claiming the airline charged fares below sustainable levels.
The Competition Commission dismissed the accusation, reinforcing the complexity of balancing fair pricing with competitive business practices.
While some stakeholders argue that tickets are too expensive for many South Africans, others contend that prices are unsustainably low, creating a challenging environment for airlines to operate profitably.
A BusinessTech analysis of round-trip flight prices between Johannesburg, Cape Town, and Durban illustrates the steep rise in costs.
For example, average fares for Johannesburg-to-Cape Town flights surged from R4,830 in 2022 to R6,928 in 2024, a staggering 43.4% increase.
Similarly, flights to Durban climbed by 31.7%, with average fares rising from R2,977 to R3,920 over the same period.
These increases highlight the growing financial burden on travellers, especially during peak holiday seasons.
While the call for an investigation into airline pricing is a step toward addressing public concerns, it is essential to consider the broader economic and operational pressures that underpin ticket costs.
Factors such as jet fuel prices, currency volatility, and maintenance challenges all play a significant role in shaping the industry’s landscape.
As the Competition Commission delves into the matter, South Africans will be hoping for greater clarity and, ultimately, a more equitable balance between affordability and sustainability in domestic air travel.
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