South African Airways (Johannesburg) continues to lose money and up until now has relied on state funding. However the SAA board recently appointed Mr. Nico Bezuidenhout as the new acting Chief Executive Officer of the struggling airline. Mr. Bezuidenhout has given the company a 90-day turnaround plan to turnaround the loss-making company by March according to EWN. The new CEO is warning the company is facing insolvency unless the plan is fully implemented. The airline has also reportedly reached out to Etihad Airways (Abu Dhabi) for a possible minority investment and guidance by the fast-growing Gulf carrier. Etihad has been investing in struggling carriers and helping to turn them around and also feed traffic to its Abu Dhabi hub.
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In other news, South African Airways announced on December 2 that it has commenced adding additional frequencies to its network which will substantially increase air services to some of its key African routes.
According to the airline, “The additional capacity injection answers the commercial mandate of the Long-Term Turnaround Strategy (LTTS), and is in response to positive market growth. As of yesterday, Harare (Zimbabwe) and Maputo (Mozambique), have included additional frequencies, with Kinshasa (Democratic Republic of Congo), and Mauritius to follow.”
“The strengthening of these routes comes in the wake of positive load factors and increased traffic between the countries,” says SAA Acting Chief Executive Officer Nico Bezuidenhout. Presently, GDP growth in Mozambique (7% – African Development Bank) and the Democratic Republic of Congo (8.1%- African Development Bank) exceed World Bank growth statistics for the continent (4.7%-2013) while South Africa’s trade and demand for leisure and business travel to Mauritius is growing at a steady pace. “Air lift services traditionally lead GDP in all markets and also track the rate of increased leisure travel, investment and business engagement between South Africa and its continental peers.”
Effective December 1, SAA increased frequencies between Johannesburg and Maputo by 24% from 17 to 21 weekly frequencies, effective 1 December Johannesburg and Harare from 18 to 19 every week (6%), effective 4 December Johannesburg and Kinshasa from 6 to 7 a week (17%) and effective 4 December Johannesburg and Mauritius from 9 to 10 weekly frequencies (11% increase).
Finally, Air China and South African Airways (SAA) have announced the further strengthening of their bilateral cooperation within the Star Alliance as part of the strengthened cooperation between the two countries.
The key element in this strengthened relationship will be some network reconfiguration for both airlines to provide better passenger and cargo services between South Africa and China and countries adjacent to both.
Copyright Photo: Fred Freketic/AirlinersGallery.com. The company has already retired the Airbus A340-200s. The fuel-inefficient Airbus A340-300s are likely to be the next type to retired and replaced in any reorganization. Airbus A340-313 ZS-SXC (msn 590) taxies at New York’s JFK International Airport.
South African aircraft slide show: