Outgoing Mango CEO and former SAA acting CEO Nico Bezuidenhout has said the restructured national airline which is born out of SAA’s business rescue plan must be free from political interference if it wants to be successful.
Speaking to the Sunday Times, Bezuidenhout said the dialogue around the restructuring of SAA needs to be “less political and more hard-nosed economics”, adding that it while it would be beneficial to its operations, it is unclear whether SAA could ever be free from government interference.
“You’d want a situation where shareholders manage via a board of directors and allow the company to pursue a strategic direction without any interference,” Bezuidenhout said.
He added that recent statements by the government were tentatively positive in this regard, suggesting there is less desire for state control over the airline’s operations.
“Government seems to be saying it doesn’t have to directly manage and run SAA – it could be done by alternative shareholders with the government having a reduced stake,” he said.
Bezuidenhout believes this approach would greatly improve SAA’s chance of success, stating that airlines cannot be run like a government department – they need to be nimble and quick to react.
Ethiopian Airlines and Emirates
This follows a recent report which stated that Ethiopian Airlines is one of the companies in talks with the South African government over the future of SAA.
One of the options reportedly under discussion is that Ethiopian Airlines buying a stake in the restructured national carrier.
This “new SAA” will require more than R10 billion in funding, and finance minister Tito Mboweni has said most of the funds should come from private resources.
According to reports, other companies which are in talks with the South African government over providing funding to SAA include Emirates.
“Emirates can confirm that it has been in touch with South African Airways for general discussions relating to the codeshare partnership between both airlines,” the airline told Bloomberg.
The R10 billion needed to revive SAA is distributed among various expenses, including the following:
- R2.8 billion to resume operations
- R2.2 billion for voluntary severance packages
- R3 billion for ticket refunds
- R1.7 for aircraft leasing companies
What the new SAA will look like
The relaunched SAA will look very different from the previous version of the national carrier.
Voluntary severance packages have been offered to employees in a bid to bring staff numbers down, and only 1,000 employees will remain to start the new airline.
This will see 2,700 SAA staff lose their jobs, including a large number of its pilots.
As part of the restructuring, SAA’s current complement of 625 pilots will be cut to 88.
It has also been reported that equal employment metrics will be more important than seniority for determining which pilots will be retained at the new SAA.
This is to address concerns from sectors players that the majority of pilots and cabin crew in the local aviation sector are white.
The government has said it will ensure the new SAA offers the right routes at the right times, and at competitive prices when it takes to the skies again.
