20°C / 22°C
  • Fri
  • 30°C
  • 14°C
  • Sat
  • 28°C
  • 13°C
  • Sun
  • 27°C
  • 12°C
  • Mon
  • 27°C
  • 14°C
  • Tue
  • 28°C
  • 15°C
  • Wed
  • 30°C
  • 15°C
  • Fri
  • 17°C
  • 10°C
  • Sat
  • 20°C
  • 10°C
  • Sun
  • 19°C
  • 12°C
  • Mon
  • 20°C
  • 12°C
  • Tue
  • 17°C
  • 12°C
  • Wed
  • 18°C
  • 11°C
  • Fri
  • 31°C
  • 16°C
  • Sat
  • 29°C
  • 15°C
  • Sun
  • 30°C
  • 15°C
  • Mon
  • 30°C
  • 16°C
  • Tue
  • 30°C
  • 16°C
  • Wed
  • 33°C
  • 16°C
  • Fri
  • 31°C
  • 11°C
  • Sat
  • 28°C
  • 14°C
  • Sun
  • 30°C
  • 13°C
  • Mon
  • 29°C
  • 15°C
  • Tue
  • 31°C
  • 15°C
  • Wed
  • 32°C
  • 13°C
  • Fri
  • 21°C
  • 17°C
  • Sat
  • 23°C
  • 16°C
  • Sun
  • 25°C
  • 17°C
  • Mon
  • 27°C
  • 19°C
  • Tue
  • 24°C
  • 19°C
  • Wed
  • 20°C
  • 17°C
  • Fri
  • 18°C
  • 13°C
  • Sat
  • 18°C
  • 12°C
  • Sun
  • 19°C
  • 12°C
  • Mon
  • 20°C
  • 14°C
  • Tue
  • 18°C
  • 14°C
  • Wed
  • 17°C
  • 13°C
  • Fri
  • 17°C
  • 7°C
  • Sat
  • 22°C
  • 9°C
  • Sun
  • 24°C
  • 9°C
  • Mon
  • 21°C
  • 11°C
  • Tue
  • 17°C
  • 10°C
  • Wed
  • 18°C
  • 8°C
  • Fri
  • 17°C
  • 9°C
  • Sat
  • 18°C
  • 11°C
  • Sun
  • 18°C
  • 12°C
  • Mon
  • 18°C
  • 12°C
  • Tue
  • 16°C
  • 11°C
  • Wed
  • 15°C
  • 11°C
  • Fri
  • 36°C
  • 15°C
  • Sat
  • 32°C
  • 16°C
  • Sun
  • 30°C
  • 15°C
  • Mon
  • 31°C
  • 17°C
  • Tue
  • 33°C
  • 17°C
  • Wed
  • 35°C
  • 16°C
  • Fri
  • 25°C
  • 9°C
  • Sat
  • 28°C
  • 8°C
  • Sun
  • 27°C
  • 14°C
  • Mon
  • 26°C
  • 15°C
  • Tue
  • 27°C
  • 12°C
  • Wed
  • 27°C
  • 10°C
  • Fri
  • 24°C
  • 13°C
  • Sat
  • 22°C
  • 13°C
  • Sun
  • 28°C
  • 14°C
  • Mon
  • 32°C
  • 14°C
  • Tue
  • 33°C
  • 14°C
  • Wed
  • 31°C
  • 16°C
  • Fri
  • 18°C
  • 10°C
  • Sat
  • 19°C
  • 8°C
  • Sun
  • 19°C
  • 10°C
  • Mon
  • 19°C
  • 12°C
  • Tue
  • 17°C
  • 12°C
  • Wed
  • 17°C
  • 10°C

SAA to shrink services as part of revamp

SAA said the impact of the reduced flights would mostly be felt among domestic passengers.

FILE: A South African Airways plane. Picture: AFP.

CAPE TOWN - South African Airways (SAA) will fly 23% fewer flights by the end of the year as it retires five aircraft, the national carrier said on Wednesday, part of a revamp aimed at returning to profit.

Loss-making SAA, which flies one of Africa’s largest fleets, received state funds in July to help it repay debts. It also depends on government debt guarantees of about R20 billion.

South Africa’s Treasury is considering a R13 billion bailout to keep SAA going as bankruptcy could hurt an economy already reduced to “junk” status by ratings agencies Fitch and S&P Global Ratings.

“One narrow-body aircraft has left the fleet, with four more expected to leave the fleet by December 2017,” acting chief executive Musa Zwane told a parliamentary committee.

Zwane said the impact of the reduced flights would mostly be felt among domestic passengers, although regional and international routes will also be affected.

As part of its turnaround strategy, he said the airline was making good progress in bringing down operational and aircraft maintenance costs.

However, liquidity constraints and exposure to volatile currency exchange rates remained a challenge, he said.
“So far there is a positive contribution by the initiatives that we have started and we are on the right footing,” he said.

The Treasury last month appointed Vodacom Group executive Vuyani Jarana as SAA chief executive. He is the first permanent leader at SAA for two years.

The deputy minister of finance told Reuters there was a “strong possibility” that Jarana will take up his new role by 1 November.

South Africa’s cabinet is considering selling its stake in landline provider Telkom, where government holds a 39% stake, to help raise R10 billion to cover a large part of SAA’s total R13 billion bailout.

National Treasury director-general Dondo Mogajane told reporters they were planning to bring a special appropriation bill for R10 billion to Parliament within a month.

“That is the plan,” he said.

Treasury officials said discussions were continuing with lenders ahead of a 30 September deadline when debts of around R6.8 billion are due to mature.

In July, the airline was provided state funds to repay loans of about R2.3 billion to Standard Chartered.

SAA is now in talks to make an initial part-payment on R1.8 billion owed to Citibank and help stave off a default by month-end, Mogajane said earlier.

“Currently, most of them are prepared to roll over and the issue is up to when,” Mogajane said in relation to nine other lenders owed money by SAA.

SAA Chief Financial Officer Phumeza Nhantsi said they were negotiating to have the loans extended by at least 18 months.

Comments

EWN welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

- Racism (including offensive comments based on ethnicity and nationality)
- Sexism
- Homophobia
- Religious intolerance
- Cyber bullying
- Hate speech
- Derogatory language
- Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the EWN community a safe and welcoming space for all.

EWN reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

EWN is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

comments powered by Disqus