{"id":714322,"date":"2023-09-04T06:00:00","date_gmt":"2023-09-04T04:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=714322"},"modified":"2023-09-01T17:02:00","modified_gmt":"2023-09-01T15:02:00","slug":"air-ticket-prices-to-get-cheaper-in-south-africa-but-theres-a-catch","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/lifestyle\/714322\/air-ticket-prices-to-get-cheaper-in-south-africa-but-theres-a-catch\/","title":{"rendered":"Air ticket prices to get cheaper in South Africa – but there’s a catch"},"content":{"rendered":"\n

Flight tickets are expected to be noticeably cheaper in South Africa heading into the festive season, but the aviation industry remains vulnerable to rocky macroeconomic factors. <\/p>\n\n\n\n

During a recent round table discussion, FlySafair’s Chief Marketing Officer, Kirby Gordon, said South Africans should expect lower flight prices during the 2023 festive season due to increased seating availability, reported<\/strong><\/a> MyBroadband.<\/p>\n\n\n\n

Over the last 12 months – especially over the festive season in 2022 and Easter 2023 – South Africans had to fork out significantly more for flight tickets as a result of high fuel prices and increased demand coupled with a rapid decline in airline capacity.<\/p>\n\n\n\n

Last year, the airline industry suffered various airline liquidations due to the pandemic, which virtually removed 40% of domestic airline capacity overnight. These fallaway airlines included Mango, Kulula, and British Airways.<\/p>\n\n\n\n

This resulted in a massive mismatch in demand and supply, which caused notable upward pressure on ticket prices, as seat availability was severely constrained. <\/p>\n\n\n\n

According to a study conducted by Discovery Bank in partnership with Visa, compounding the issue was that the cost of aviation fuel also increased by more than 80% in 2022 compared to 2021, creating a perfect trifecta that saw ticket prices skyrocket.<\/p>\n\n\n\n

According to the study’s data, South Africans were paying 30% to 55% more for local flights than in 2019.<\/p>\n\n\n\n

Expect cheaper air tickets<\/strong><\/p>\n\n\n

\n
\"\"<\/a>
FlySafair’s Chief Marketing Officer, Kirby Gordon.<\/figcaption><\/figure><\/div>\n\n\n

Gordon noted that since the decline in airline capacity in 2022, remaining airline brands have added a significant amount of new aircraft to their fleets \u2013 increasing the number of available seats.<\/p>\n\n\n\n

A notable factor aiding the increase in seat capacity was the introduction of Lift into the market, which brought the number of airline companies back to five, he said. <\/p>\n\n\n\n

He further noted that most South Africans are dealing with constrained finances due to high interest rates and inflation, resulting in lower demand.<\/p>\n\n\n\n

Gordon described these factors as “pro-consumer” and, because flight prices are mainly demand-based, These two factors should help to \u201ckeep prices a bit lower\u201d.<\/p>\n\n\n\n

Macroeconomic exposures<\/strong><\/p>\n\n\n\n

Although South Africans can look forward to lower air rickets in the near term, Gordon added that the rand-dollar exchange rate fluctuations, crude oil prices, and a lack of skilled maintenance in the country pose a significant risk to flight prices.<\/p>\n\n\n\n

While these factors are all important, the primary exposure underpinning the impact of both oil prices and maintenance on the airline industry is the strength of the rand. <\/p>\n\n\n\n

Gordon explained that Operating costs can significantly increase if the rand weakens against the dollar, as aircraft and maintenance parts are purchased in dollars.<\/p>\n\n\n\n

He added that killed maintenance, machining facilities, and workshops have been difficult to find locally since the pandemic – meaning the company is often forced to look overseas for technicians – which comes at a greater cost if the rand weakens. <\/p>\n\n\n\n

This also applies to fuel costs, with crude oil traded in dollars. Gordon pointed out that fuel expenses make up around 50% of the operational costs of every flight, making crude oil prices and rand-dollar fluctuations some of FlySafair’s most significant risks. <\/p>\n\n\n\n

\n\n\n\n

Read: Over half a million South Africans have moved to the UK, Australia, and Canada<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

FlySafair expects cheaper air ticket prices for South Africans in 2023, but warns the unstable rand remains a significant risk. <\/p>\n","protected":false},"author":10,"featured_media":714352,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9876],"tags":[10020,853],"class_list":["post-714322","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lifestyle","tag-flysafair","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/714322","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=714322"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/714322\/revisions"}],"predecessor-version":[{"id":715472,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/714322\/revisions\/715472"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/714352"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=714322"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=714322"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=714322"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}