Mango expects 'another challenging year' for South African aviation in 2017

Mango stated (06-Dec-2016) South Africa's domestic aviation industry may face a "challenging year" with "occasional opportunity" in 2017. The industry is expected to see little growth with challenging economic conditions and higher commodity prices. Industry wide consolidation is expected. Mango CEO Nic Vlok predicted less than 1% sustainable growth in the industry and said cost compression, more prudent spending, offering more attractive value propositions to consumers and increasing market share in a period of consolidation will be the main themes for airlines in 2017. Exchange rates, increased fuel prices and the potential early implementation of the Yamoussoukro Decision on open skies may also impact domestic aviation. Mr Vlok said: "an increase in the spot price of oil next year will add pressure on carries in a highly competitive environment. Operational efficiencies, fuel efficient aircraft and productivity growth will be critical factors in cushioning the impact." Mr Vlok added, "Little positive movement in traveller volumes, price competition and an expected rise in commodity prices will add growing pressure on already squeezed airline margins." [more - original PR]