30-Oct-2012 2:50 PM

Comair issues objection to government loan guarantee for SAA

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]

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