Comair challenged (29-Oct-2012) the decision by South Africa's Government to guarantee ZAR5 billion (USD575.8 million) in loans for South African Airways (SAA). Comair CEO Erik Venter said, "We understand that SAA has to rely on its shareholder to the extent that it is required to deliver a public service, in this case servicing routes that are not commercially viable for private airlines. However this does not apply in the domestic market or even on many routes into Africa where South African based airlines are attempting to compete against SAA. The losses incurred by SAA and Mango in the domestic market could not be sustained by a private airline, and have been incurred to protect SAA’s market share at the expense of its competitors and the taxpayer. We do not see any controls in place that will prevent this from happening again." Comair advocates establishing SAA's domestic operations, including Mango and SA Express, as a separate entity with its own leadership and financial reporting. [more - original PR]
Comair issues objection to government loan guarantee for SAA
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European airline seat capacity growth accelerates - perhaps too quickly: Outlook for winter 2016/17
The summer 2016 season came to an end on 29-Oct-2016. Adjusting for an extra week relative to the previous summer, it produced seat growth of 6% for capacity to/from/within Europe, matching the rate of growth in summer 2015, but higher than the 10-year average rate of 4% and higher than any other summer since 2010.
Current indications from data filed with OAG are that Europe will also experience accelerating capacity growth in the winter 2016/2017 season, which runs from 30-Oct-2016 to 25-Mar-2017. Adjusting for the season being shorter by one week relative to last winter, total seat growth in Europe is set to reach 7%, compared with 6% growth in winter 2015/2016 (and 6% growth in summer 2016). This is higher than the 10-year average rate for winter of 3% and the highest winter growth since 2007/2008.
On routes to all but one region from Europe, seat growth this winter will both be faster than last winter and higher than its 10-year average. The one exception is Europe to Middle East, the fastest-growing region, where capacity growth will remain at 10%. This report presents analysis of this winter's seat growth for Europe by region and by airline group.
South African Airways seeks regional growth and new partnerships, but outlook remains bleak. UPDATE
South African Airways (SAA) is again looking at opportunities for new partnerships and network expansion. SAA is now re-engaging with Etihad following an unsuccessful initial partnership and is keen to launch new routes after the delivery of its first two A330-300s in 4Q2016.
Any growth, however, is unlikely to be profitable until SAA addresses its longstanding challenges. The airline has still not fully implemented its previous turnaround plan and urgently needs yet another capital injection.
A full and deep restructuring is required but seems impossible in the current political environment. Repeated government meddling has put SAA in an extremely challenging situation. The airline is in dire straits, and its outlook remains bleak.