Time to shut down SAA – Business Leadership boss
The CEO of business lobby group Business Leadership SA has called for SAA to be shut down, hours after the cash-strapped airline cancelled several international flights to save money yesterday.
‘We're sitting with an airline that is cancelling flights,’ said Busisiwe Mavuso.
‘We're probably going to have to do the honourable thing and just close SAA down now instead of trying to kick the can down the road any further,’ she is quoted as saying in Business Day from the sidelines of the World Economic Forum's annual meeting in Davos.
SAA confirmed reports that it had cancelled several international flights to save money in a low-demand environment. The national carrier, which was placed into bankruptcy protection in December, is waiting for the government to fulfil a pledge to provide it with a R2bn financial lifeline that will enable it to keep flying. The Department of Public Enterprises, which oversees SAA, said work was still under way to raise the money.
A second Business Day report notes SAA said it has ‘consolidated’ various domestic flights and cancelled several international flights to conserve cash.
Two SAA unions – Numsa and the SA Cabin Crew Association – have presented their business rescue plans for the airline. According to a report in Die Burger, the unions said they initially did not support business rescue, but now view it as the only solution for SAA.
Some of the proposals include an exemption for SAA from the Public Finance Management Act which makes it difficult for SAA to take agile decisions or to obtain financing.
The unions want SAA to form joint ventures with airlines such as Qatar, Turkish Airlines, Emirates and Ethiopian airlines for international routes as those routes currently contribute 65% of SAA’s losses. Numsa and Sacca agreed also to proposing a merger of SAA Technical with Lufthansa Technik. Although they remain opposed to any sell-off of subsidiaries such as Air Chefs, they propose a review of the subsidiaries’ roles.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.
