South African Airways cut 38 local and international flights this week, an indication of a possible downsizing of the cash-strapped national carrier to avoid total collapse.<\/p>\n
Various trips to Cape Town, Durban and Munich from SAA\u2019s Johannesburg hub were cancelled after the government stalled on a R2 billion ($138-million) cash injection pledged as part of a local form of bankruptcy protection.<\/p>\n
The state-owned airline has lost money since 2012 as it grapples with high operating costs, an inefficient jet fleet, mismanagement and corruption allegations.<\/p>\n
SAA is trying to \u201cconserve cash and optimize the airline\u2019s position ahead of any further capital investment,\u201d the company said in an emailed statement, adding that further stoppages may happen in coming days.<\/p>\n
Les Matuson and Siviwe Dongwana, who were appointed as SAA\u2019s business rescue practitioners, are due to present a turnaround plan to creditors by Feb. 28. It\u2019s likely to include a comprehensive restructuring of the airline\u2019s operations – including the removal of several unprofitable routes.<\/p>\n
SAA hasn\u2019t published audited financial statements for the year through March 2019 because it couldn\u2019t be sure of its status as a going concern, meaning up-do-date information of its route performance isn\u2019t publicly available.<\/p>\n
However, a presentation given by former chief executive officer Vuyani Jarana in February gave an indication of which flights could be rationalized or cut. Jarana quit at the end of May, and a permanent replacement hasn\u2019t been appointed.<\/p>\n
International<\/strong><\/p>\n SAA\u2019s trips to nine destinations outside of Africa historically generated just over half of flight revenue, yet the only profitable route was to Washington D.C. The biggest losses were incurred on flights to Hong Kong – which were suspended in November due to protests – and to Munich and Frankfurt.<\/p>\n SAA has since leased fuel-efficient Airbus A350-900 planes to use on some long-haul routes in a bid to reduce international losses.<\/p>\n Regional<\/strong><\/p>\n SAA flew to 21 destinations in other African countries, and the only loss-making route was to Ethiopia, where it competes with that country\u2019s profitable state carrier. The biggest money spinners were flights to Zimbabwe, Zambia, Mozambique and Nigeria. Regional trips generated about 30% of SAA flight revenue.<\/p>\n Domestic<\/strong><\/p>\n SAA\u2019s flights linking Johannesburg with Durban, Cape Town and East London were all profitable, but it lost money on its route to the southern city of Port Elizabeth. Local flights accounted for 17% of the carrier\u2019s flight revenue. The company\u2019s low-cost Mango Airlines also competes on those routes, alongside other budget rivals.<\/p>\n \u201cSAA is working closely with its sister airline, Mango, to re-accommodate passengers on alternative services operated by both airlines to minimise disruptions and thereby ensure passengers reach their destination as quickly as possible,\u201d SAA spokesperson Tlali Tlali said in a statement on Tuesday (21 January).<\/p>\n The following domestic flights operated by SAA have been cancelled:<\/p>\n Johannesburg (JNB) \u2013 Cape Town (CPT) SA303\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0530\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 0735\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21 & 24 January<\/p>\n SA307\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0700\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 0905\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 21 January<\/p>\n Cape Town (CPT) \u2013 Johannesburg (JNB) SA316\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0820\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1015\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21 & 24 January<\/p>\n SA322\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0950\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1145\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 21 January<\/p>\n Johannesburg (JNB) \u2013 Durban (DUR) SA527\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0630\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 0735\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22 & 23 January<\/p>\n SA543\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0955\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1100\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22 & 23 January<\/p>\n SA571\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 1655\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1800\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20 & 21 January<\/p>\n Durban (DUR) \u2013 Johannesburg (JNB) SA534\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 0805\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 0910\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22 & 23 January<\/p>\n SA550\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 1130\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1235\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22 & 23 January<\/p>\n SA578\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 1840\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 1945\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20 & 21 January<\/p>\n On the international network, SAA is cancelling selected services between Johannesburg and Munich. SAA will re-accommodate passengers on its services between Johannesburg and Frankfurt, as well as London Heathrow.<\/p>\n \u201cSome passengers travelling to Munich and others travelling via Munich to other destinations will be re-accommodated for some of their journey on partner airlines in the Star Alliance to minimise delays,\u201d Tlali said.<\/p>\n The following flights have been cancelled:<\/p>\n Johannesburg (JNB) \u2013 Munich (MUC) SA264\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 21:15\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 07:00\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22, 23 & 24 January<\/p>\n Munich (MUC) \u2013 Johannesburg (JNB) SA265\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Depart 20:30\u00a0\u00a0\u00a0\u00a0\u00a0 Arrive 08:20\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Dates: 20, 21, 22, 23 & 24 January<\/p>\n SAA said these decisions are in line with its usual policy of reviewing flights and consolidating services with low demand.<\/p>\n \u201cFurthermore, during the current process of business rescue, these cancellations represent a responsible strategy to conserve cash and optimise the airline\u2019s position ahead of any further capital investment,\u201d Tlali said.<\/p>\n SAA said consolidation on the Cape Town route is also necessary, as the airline has been operating training flights for pilots on the new state-of-the-art Airbus 350-900 aircraft on this route – before transferring the new planes to international routes.<\/p>\n \u201cThe introduction of these larger aircraft has resulted in temporary surplus capacity on the route. SAA will be reviewing further possible flight schedule amendments over the coming days.<\/p>\n \u201cAny operational changes will be communicated to our travel trade partners and customers at the earliest opportunity and passengers will be re-accommodated on other airlines wherever possible,\u201d said Tlali.<\/p>\n
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