Wednesday, April 24Inside Business Africa

S’African Airways Seeks More Time for Turn Around

Struggling South African Airways has asked the government for more time to turn the airline around.

The third extension was reportedly due to the new challenging market conditions that have decimated the airline industry. Currently, the airline is restricted to flying only domestic shuttle routes between its hub in Johannesburg and Cape Town.

South African Airways has been in financial peril for the last few months. The airline has been plagued by management issues, old aircraft (notably Airbus A340 aircraft it uses to fly long-haul international routes) and aggressive expansion by rivals.

Last year, the airline was placed into the care of a business rescue firm run by partners Les Matuson and Siviwe Dongwana.

But, since then, the two partners have asked the government for further extensions regarding their turnaround plan. The duo has run into several problems actioning their revitalisation of the airline, such as union disputes (being forced to retain expensive engineers) and even the government themselves withholding funds.

But this latest deferral is very much due to outside forces plaguing the industry, with very limited travel options for the airline to make money outside of South Africa. The airline has been restricted from operating regional African routes and international routes to help prevent the spread of the coronavirus, forcing most services to be grounded and just be operating limited domestic capacity.

Source: This Day

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