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Chrisba320
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Re: SAA shrinks even further

Fri Feb 07, 2020 2:51 pm

TTailedTiger wrote:
What is the point of keeping SAA around? When was the last time they weren't hemorrhaging money?


SAA made a profit of almost R 1B in 2011 despite having inefficient aircraft and some routes that made no sense. But then the looting and mismanagement started which is why they have been hemorrhaging money ever since, not because it is a bad airline or because they can’t be profitable. Business rescue is the best thing that could have happened to them and the business practioners are doing a sterling job. Restructuring their route network is critical and I am surprised by how quickly it happened. I am confident SAA will emerge from this process leaner, more efficient and most importantly, able to return to profitability. Between the A320, A330 and A350 they have the right aircraft for the job and a route network that makes sense. All good news from where I’m sitting..
 
seat64k
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Re: SAA shrinks even further

Fri Feb 07, 2020 3:10 pm

grjplanes wrote:
NZ516 wrote:
TTailedTiger wrote:
What is the point of keeping SAA around? When was the last time they weren't hemorrhaging money?


It has been mentioned a couple of times in this thread that the last year SAA made a profit was 2011 so coming up to 9 years.


There's lots of talk that just closing it down will cost the government a lot more (mentions of R 80 billion)...which will have much bigger ramifications for the country as a whole.


Besides the government bailouts, SAA has a lot of loans from banks, etc, that are secured by the government. SAA being an SOE, its debts are linked to debt of other SOEs, notably the power utility Eskom, the other grossly mismanaged and horrifically overindebted SOE. I don't know the precise details, but the long and short of it is that, if the government allows one SOE to default on its debt, the lenders can call in the debt of other SOEs. I imagine this is to protect the lenders and keep government in line.

Should SAA default, the figure that goverment could be on the hook for is way more than R80b - over R400b from what I've head. The government simply does not have the money, it would have severe consequences for the country.

Whatever we may think about the government's reasons for wanting to have an airline, they have no choice but to keep the airline running until it can be brought back into the black.

A388 wrote:
Very harsh measures that SAA (government) needed to take and quite admirable they had the balls to do this as they mishandled the airline for a long time without taking any action.


Just to be clear, the government had nothing to do with this decision. They would never ever ever do something like this. This was the decision of the business rescue practitioner. The goverment's hands are tied, and everyone from the unions to the president is very upset about this. The next thing we will see (already announced) is deep staff cuts, another remedy the governement would never do themselves.

Remember that the governing party, the ANC, is an alliance that includes A TRADE UNION and the communist party. They're the people who agreed to a an 8% pay rise across the board at the very moment that SAA didn't even have cash for the next month's salaries. Lay-offs? Not on their watch.
 
dcajet
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:06 pm

Two of SAA's cancelled routes would get a reprieve for a few more weeks. It appears they are having issues accommodating their passengers on other airlines.

Image
Keep calm and wash your hands.
 
raylee67
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:23 pm

I am guessing the US services (NYC and IAD via ACC) will be served with the A350 (which SAA has 4) and LHR, FRA and PER will be served with A333 (which SAA has 5)? That means the airline can get rid of all A340 and A332.

With the reduction of regional and domestic routes, it can get rid of all the A319s too.
319/20/21 332/33 342/43/45 359/51 388 707 717 732/36/3G/38/39 74R/42/43/44/4E/48 757 762/63 772/7L/73/7W 788/89 D10 M80 135/40/45 175/90 DH1/4 CRJ/R7 L10
AY LH OU SR BA FI
AA DL UA NW AC CP WS FL NK PD
CI NH SQ KA CX JL BR OZ TG KE CA CZ NZ JQ RS
 
Williamsb747
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:27 pm

raylee67 wrote:
I am guessing the US services (NYC and IAD via ACC) will be served with the A350 (which SAA has 4) and LHR, FRA and PER will be served with A333 (which SAA has 5)? That means the airline can get rid of all A340 and A332.

With the reduction of regional and domestic routes, it can get rid of all the A319s too.

FRA is already an A359
B747>A340>A350>B777>MD11>B767>B757>MD88/90>B787>A380>A330>A220>A320>B737.
CPT JNB
 
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jfklganyc
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:39 pm

Are JFK and IAD prestige routes or do they make money?
 
grjplanes
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:53 pm

raylee67 wrote:
I am guessing the US services (NYC and IAD via ACC) will be served with the A350 (which SAA has 4) and LHR, FRA and PER will be served with A333 (which SAA has 5)? That means the airline can get rid of all A340 and A332.

With the reduction of regional and domestic routes, it can get rid of all the A319s too.


According to the schedules it would look like follows:

4 x A350-900 (daily JFK and FRA)
5 x A330-300 (daily ACC-IAD, LHR, LOS)
2 x A340-300 for PER

In between there is also a daily JNB-MRU and JNB-CPT

Doubt the A330-300 can do PER efficiently and the A359 might be too big and used on other routes already.

No A330-200s scheduled after April (last being some of this few GRU and MUC flights), so they're likely going back.
Guess leasing the A330-200s is more expensive than holding on to 2 or 3 A340-300s which is paid off (if it's owned ones)

Some A320s might also leave. Might still end up with a mix A319/A320 fleet...but some of this might also transfer to Mango. All is still speculations, we should know more by the end of the month.
Last edited by grjplanes on Mon Feb 17, 2020 5:58 pm, edited 2 times in total.
 
x1234
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Re: SAA shrinks even further

Mon Feb 17, 2020 5:54 pm

With their cancelled flights they can get rid of the A340 which should decrease their fuel bill. The only destination that is A340 at the moment is PER. Once GRU is cancelled they can use that aircraft for PER.
JFK: A359
FRA: A359
IAD-ACC: A333
PER: A332
LHR: A333
 
Pi7472000
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Re: SAA shrinks even further

Mon Feb 17, 2020 6:15 pm

I am flying GRU to CPT via JNB in business one way tomorrow on SAA. Was able to get a great mileage fare using my UA miles at the last minute. Now that U.S. citizens do not need VISA for Brasil I am able to go to GRU and then transfer to South African from UA. It is sad to see SAA exiting Brasil. Also get to fly the A350 from JNB to CPt. Hopefully SAA can find a way to become financially stable as I have enjoyed their international service more than UA in the past.
 
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3BNBE
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Re: SAA shrinks even further

Wed Feb 19, 2020 2:51 pm

As from March 2020
SA will operate 5 of its 7 weekly flights to Mauritius with its A350, with the 2 other flights being operated with an A340-300.

https://www.routesonline.com/news/38/ai ... =Mauritius
 
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Slug71
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Re: SAA shrinks even further

Thu Feb 20, 2020 2:06 am

3BNBE wrote:
As from March 2020
SA will operate 5 of its 7 weekly flights to Mauritius with its A350, with the 2 other flights being operated with an A340-300.

https://www.routesonline.com/news/38/ai ... =Mauritius


Sounds like SAA is going to be working these four A350s pretty hard.
 
andz
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Re: SAA shrinks even further

Thu Feb 20, 2020 7:34 pm

Slug71 wrote:
Sounds like SAA is going to be working these four A350s pretty hard.


Maybe that's the way to go instead of having planes languishing on the ground all day a la LHR.
After Monday and Tuesday even the calendar says WTF...
 
planeguy
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Is it the beginning of the end for SAA?

Sat Apr 18, 2020 12:25 am

It's been long established on this forum that SAA has been in financial trouble for quite some time. To add fuel to the fire, the COVID pandemic has worsened their situation even more. Back in December 2019 it was speculated that the SA government would inject ZAR 2 billion (approx US$ 139 million) to keep the struggling flag carrier afloat. Apparently, that funding never came and just recently the government has made it clear that it is no longer willing to shovel taxpayer money into a bottomless pit. Instead, the state wants to leave the carrier up to its own devices to secure funding. Whether this goal is realized or not still remains to be seen.

https://airlinegeeks.com/2020/04/15/cov ... s-funding/


I myself have fond memories of flying with them domestically back in the 90's when they offered their domestic airpass. Personally, I find it sad that a once venerable airline has come to this state.

https://www.youtube.com/watch?v=3Na8GV0FNfc
 
codc10
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Re: Is it the beginning of the end for SAA?

Sat Apr 18, 2020 1:01 am

This might be more like the “end of the end.”
 
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Antaras
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Re: Is it the beginning of the end for SAA?

Sat Apr 18, 2020 1:36 am

SAA's end started a year ago.
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PA110
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Re: Is it the beginning of the end for SAA?

Sat Apr 18, 2020 2:07 am

Antaras wrote:
SAA's end started a year ago.


SA's end started a decade ago with breathtaking corruption and mismanagement.
Look, it's been swell, but the swelling's gone down.
 
maps4ltd
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Re: Is it the beginning of the end for SAA?

Sat Apr 18, 2020 2:14 am

Yep, end of the end. Unless the cash-strapped SA government pulls an Alitalia (not advisable).
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xwb777
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SAA to layoff entire staff

Sat Apr 18, 2020 9:39 am

South African Airways has decided to layoff its entire 4700 staffs in a bid to win again the govermental support to prevent the airline from falling off.

The airline has offered its employees a new pay deal, where the airline will be paying a one month salary per year of service to conserve the much needed cash.
SAA last generated profuts were in 2011 & then the airline began to receive bailouts from the government and debt agreements for several years. Now the governement says no more cash for the ill fated airline and the company closure will save finances for the governement.

COVID19 is the final nail in the airline’s coffin. Will the governement go ahead a start a new national airline or will it wait for the current situation to clear and start a new project?

Source: https://www.google.ae/amp/s/www.bloombe ... -workforce
 
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Antaras
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 9:55 am

SAA's fleet is quite inefficient. Especially with the A340, I am sure that SAA's business would be better without those airframes.
SAA should call VN for some more A359, as if it could survive after this pandemic :roll:
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IWMBH
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:26 am

Please just put an end to SAA, it is ruined by years of mismanagement and corruption.
It's better to just let it die and start over with another airline that is focused on making money.
I'm sorry for all the employees, I hope that they'll be able to find a job at another, more stable, airline.

Happy that the South-African government won't put anymore taxpayer money into SAA.
Better than what the Italian government is trying with Alitalia, spending millions on a airline thats dead in the water.
 
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PM
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:41 am

Antaras wrote:
SAA's fleet is quite inefficient. Especially with the A340


Will this myth never die? So, if SAA had a fleet of 777s or 787s or A350s, it would be a successful, profitable airline? The A340s are not the problem and never have been. :roll:
 
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PM
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:45 am

Antaras wrote:
SAA's fleet is quite inefficient. Especially with the A340.

The more I think about it...

The whole fleet is "quite inefficient"? Not just the A340s? So, that would be A319s, A320s and A330s? Then what, exactly, should SAA be flying? And what about the scores or hundreds of other airlines somehow scraping by with "inefficient" A320s and A330s?

Jeez...
 
andz
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:51 am

In the news this morning, SAA to terminate all staff, so that's basically it.

https://www.fin24.com/Economy/saa-offer ... r-20200417
After Monday and Tuesday even the calendar says WTF...
 
IWMBH
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 11:00 am

andz wrote:
In the news this morning, SAA to terminate all staff, so that's basically it.

https://www.fin24.com/Economy/saa-offer ... r-20200417


Other news sources are picking it up aswel.
This is probably the end, who else is going to invest a single dollar in this company?

https://www.bloomberg.com/news/articles ... -workforce
 
andz
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Re: SAA to layoff entire staff

Sat Apr 18, 2020 12:17 pm

xwb777 wrote:
South African Airways has decided to layoff its entire 4700 staffs in a bid to win again the govermental support to prevent the airline from falling off.

The airline has offered its employees a new pay deal, where the airline will be paying a one month salary per year of service to conserve the much needed cash.
SAA last generated profuts were in 2011 & then the airline began to receive bailouts from the government and debt agreements for several years. Now the governement says no more cash for the ill fated airline and the company closure will save finances for the governement.

COVID19 is the final nail in the airline’s coffin. Will the governement go ahead a start a new national airline or will it wait for the current situation to clear and start a new project?

Source: https://www.google.ae/amp/s/www.bloombe ... -workforce


Sorry, I didn't see this before I posted my reply above.

xwb777 wrote:
The airline has offered its employees a new pay deal, where the airline will be paying a one month salary per year of service to conserve the much needed cash.


That would be great, my wife has 41 years' service! However it is one week salary per year of service which is the minimum required under the labour law if employees are retrenched.
After Monday and Tuesday even the calendar says WTF...
 
davidjohnson6
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 1:49 pm

I think the terms are 1 month pay plus a week for each year of service. A person with 10 years service get 1 month plus 10 weeks pay - or about 14 weeks pay. This is subject to SAA being able to raise the cash by selling its assets (eg aircraft spare parts) for cash
 
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aemoreira1981
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 2:36 pm

When the lockdown ends in South Africa, I see a good opportunity for Comair to pick up some cheap B738s (from the Mango side) and expand its short-haul operation into central Africa, up to Nigeria or the west African coast (from CPT, primarily destinations like LOS, ACC, and ABJ; JNB is too high to fly those routes, which are near the upper range of the B738 nonstop) and which could also allow Comair to retire the last of its B734s, some of which are more than 30 years old. (FlySafair isn't likely to fill that void as they only fly domestic routes.)

As for regional connectivity, Airlink could pick up the Dash 8s from South African Express, all of which are leased from South Africa's largest bank. However, the CRJ2s are definitely done and I would not be surprised to see the CRJ7s meet the same fate.

Fleetwise, the A320s and A330s should find new homes in not too much time in other countries. I expect that the A350s will be reclaimed by their airline owners soon (HU and MK). The A319s are so-so on a future, but the A340s are done.

On long-haul, I do not expect any South African carrier to fill that void. Routes like JNB-JFK and JNB-DSS-IAD, I expect to disappear, which should leave Delta with a monopoly on travel to North America, on JNB-ATL (if United's EWR-CPT does not return for NW20). Likewise, a DL-related carrier will have a monopoly to South America (LATAM Brasil on JNB-GRU). However, almost everyone domestically will need to codeshare with Comair (including Kulula) and Airlink for local or regional haul. As for travel to Asia, I see one-stop options like Emirates, Qatar, and Ethiopian competing (with Qantas being a monopoly to Australasia).
 
majano
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 2:54 pm

aemoreira1981 wrote:
When the lockdown ends in South Africa, I see a good opportunity for Comair to pick up some cheap B738s (from the Mango side) and expand its short-haul operation into central Africa, up to Nigeria or the west African coast (from CPT, primarily destinations like LOS, ACC, and ABJ; JNB is too high to fly those routes, which are near the upper range of the B738 nonstop) and which could also allow Comair to retire the last of its B734s, some of which are more than 30 years old. (FlySafair isn't likely to fill that void as they only fly domestic routes.)

As for regional connectivity, Airlink could pick up the Dash 8s from South African Express, all of which are leased from South Africa's largest bank. However, the CRJ2s are definitely done and I would not be surprised to see the CRJ7s meet the same fate.

Fleetwise, the A320s and A330s should find new homes in not too much time in other countries. I expect that the A350s will be reclaimed by their airline owners soon (HU and MK). The A319s are so-so on a future, but the A340s are done.

On long-haul, I do not expect any South African carrier to fill that void. Routes like JNB-JFK and JNB-DSS-IAD, I expect to disappear, which should leave Delta with a monopoly on travel to North America, on JNB-ATL (if United's EWR-CPT does not return for NW20). Likewise, a DL-related carrier will have a monopoly to South America (LATAM Brasil on JNB-GRU). However, almost everyone domestically will need to codeshare with Comair (including Kulula) and Airlink for local or regional haul. As for travel to Asia, I see one-stop options like Emirates, Qatar, and Ethiopian competing (with Qantas being a monopoly to Australasia).

Assuming Comair comes out of this unscathed, yes there could be opportunities. But the severity and unpredictable nature of this pandemic makes me doubt that outcome. A few weeks ago Flysafair was reported to be requesting government support. If there is no support for SAA, I doubt there will be any for private airlines.
 
davidjohnson6
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 3:08 pm

SAA has been losing money for years. Has Comair been profitable in the last few years ?
 
sxf24
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 3:12 pm

davidjohnson6 wrote:
SAA has been losing money for years. Has Comair been profitable in the last few years ?


Comair was always profitable until the most recent year. They’re owed a lot of money by SAA, which they will probably never see. Regardless, I think they can survive.
 
maverick4002
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 3:28 pm

aemoreira1981 wrote:
When the lockdown ends in South Africa, I see a good opportunity for Comair to pick up some cheap B738s (from the Mango side) and expand its short-haul operation into central Africa, up to Nigeria or the west African coast (from CPT, primarily destinations like LOS, ACC, and ABJ; JNB is too high to fly those routes, which are near the upper range of the B738 nonstop) and which could also allow Comair to retire the last of its B734s, some of which are more than 30 years old. (FlySafair isn't likely to fill that void as they only fly domestic routes.)

As for regional connectivity, Airlink could pick up the Dash 8s from South African Express, all of which are leased from South Africa's largest bank. However, the CRJ2s are definitely done and I would not be surprised to see the CRJ7s meet the same fate.

Fleetwise, the A320s and A330s should find new homes in not too much time in other countries. I expect that the A350s will be reclaimed by their airline owners soon (HU and MK). The A319s are so-so on a future, but the A340s are done.

On long-haul, I do not expect any South African carrier to fill that void. Routes like JNB-JFK and JNB-DSS-IAD,
I expect to disappear, which should leave Delta with a monopoly on travel to North America, on JNB-ATL (if United's EWR-CPT does not return for NW20).
Likewise, a DL-related carrier will have a monopoly to South America (LATAM Brasil on JNB-GRU). However, almost everyone domestically will need to codeshare with Comair (including Kulula) and Airlink for local or regional haul. As for travel to Asia, I see one-stop options like Emirates, Qatar, and Ethiopian competing (with Qantas being a monopoly to Australasia).


If this happens I think UA might make EWR permanent or AA will look into Miami. UA is on record as saying the route was exceeding expectations and there is money to be made in Africa, moreso now with the loss of the biggest capacity airline to the country.
 
majano
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 4:05 pm

Let me just clarify that I don't doubt that Comair will survive, just that their immediate priority when the recovery begins will not be acquisitions and growth into regional markets from which SAA retreated.
 
N292UX
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 4:20 pm

I wonder if Airlink will survive this. They codeshare with SAA but are in independent brand.
 
ahj2000
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 4:20 pm

majano wrote:
aemoreira1981 wrote:
When the lockdown ends in South Africa, I see a good opportunity for Comair to pick up some cheap B738s (from the Mango side) and expand its short-haul operation into central Africa, up to Nigeria or the west African coast (from CPT, primarily destinations like LOS, ACC, and ABJ; JNB is too high to fly those routes, which are near the upper range of the B738 nonstop) and which could also allow Comair to retire the last of its B734s, some of which are more than 30 years old. (FlySafair isn't likely to fill that void as they only fly domestic routes.)

As for regional connectivity, Airlink could pick up the Dash 8s from South African Express, all of which are leased from South Africa's largest bank. However, the CRJ2s are definitely done and I would not be surprised to see the CRJ7s meet the same fate.

Fleetwise, the A320s and A330s should find new homes in not too much time in other countries. I expect that the A350s will be reclaimed by their airline owners soon (HU and MK). The A319s are so-so on a future, but the A340s are done.

On long-haul, I do not expect any South African carrier to fill that void. Routes like JNB-JFK and JNB-DSS-IAD, I expect to disappear, which should leave Delta with a monopoly on travel to North America, on JNB-ATL (if United's EWR-CPT does not return for NW20). Likewise, a DL-related carrier will have a monopoly to South America (LATAM Brasil on JNB-GRU). However, almost everyone domestically will need to codeshare with Comair (including Kulula) and Airlink for local or regional haul. As for travel to Asia, I see one-stop options like Emirates, Qatar, and Ethiopian competing (with Qantas being a monopoly to Australasia).

Assuming Comair comes out of this unscathed, yes there could be opportunities. But the severity and unpredictable nature of this pandemic makes me doubt that outcome. A few weeks ago Flysafair was reported to be requesting government support. If there is no support for SAA, I doubt there will be any for private airlines.

Hopefully IAG can throw support to their franchise carrier down south. Their is an actual opportunity on some of the routes that SAA did fly. However, being an all 737 carrier means that some of them may be too small/large for their aircraft.
I would argue that there is a market to places like JFK, LOS, etc. Their capafcity to FRA, IAD, and PER might not be replicated, but that'll be OK.

BUT do we know what will happen to Airlink and SAE?
-Andrés Juánez
 
evanb
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 4:54 pm

aemoreira1981 wrote:
When the lockdown ends in South Africa, I see a good opportunity for Comair to pick up some cheap B738s (from the Mango side) and expand its short-haul operation into central Africa, up to Nigeria or the west African coast (from CPT, primarily destinations like LOS, ACC, and ABJ; JNB is too high to fly those routes, which are near the upper range of the B738 nonstop) and which could also allow Comair to retire the last of its B734s, some of which are more than 30 years old. (FlySafair isn't likely to fill that void as they only fly domestic routes.)


Mango are not part of the business rescue process or the layoffs or liquidation. They will continue as a going concern and likely sold. It will not be liquidated.
 
Thibault973
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 6:18 pm

evanb wrote:

Mango are not part of the business rescue process or the layoffs or liquidation. They will continue as a going concern and likely sold. It will not be liquidated.


I have never flown SAA but have Mango and I can say that it was probably the worst service I witnessed in a longggg time (only worse airline I might think of being Surinam Airways).
 
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PatrickZ80
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 6:49 pm

Thibault973 wrote:
I have never flown SAA but have Mango and I can say that it was probably the worst service I witnessed in a longggg time (only worse airline I might think of being Surinam Airways).


What would you expect, they're a low-cost airline. A bit like the Ryanair of South Africa. People don't fly Mango for it's service, they fly it for it's low prices.
 
evanb
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 6:55 pm

Thibault973 wrote:
I have never flown SAA but have Mango and I can say that it was probably the worst service I witnessed in a longggg time (only worse airline I might think of being Surinam Airways).


Having flown Mango many times, I'd take them over any European, Asian or N American LCC.
 
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MrGtheSheepA346
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 7:52 pm

Could Ethiopian be a contender to take over SAA? Given their shared Star Alliance membership it doesn’t seem that unlikely
 
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LAX772LR
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 8:57 pm

MrGtheSheepA346 wrote:
Could Ethiopian be a contender to take over SAA? Given their shared Star Alliance membership it doesn’t seem that unlikely

Why do you believe that co-involvement in a loose arrangement of codeshares+marketing, would prompt ET to sink money into a black-hole pit from which it can't possibly expect to see a return on investment?
I myself, suspect a more prosaic motive... ~Thranduil
 
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aemoreira1981
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 9:38 pm

MrGtheSheepA346 wrote:
Could Ethiopian be a contender to take over SAA? Given their shared Star Alliance membership it doesn’t seem that unlikely


Ethiopian is owned by the country's government, but the government is virtually hands off. South African as a patronage mill got run into the ground. It would be better off if they let South African collapse and then seek to build up the services themselves with flag carrier status from South Africa instead (if South Africa is willing to be hands-off). Ethiopian is one of the rare African carriers that does long-haul that is usually profitable. If Africa ever had an open skies agreement, Ethiopian would be effectively a pan-African carrier.
 
MIflyer12
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:18 pm

davidjohnson6 wrote:
I think the terms are 1 month pay plus a week for each year of service. A person with 10 years service get 1 month plus 10 weeks pay - or about 14 weeks pay. This is subject to SAA being able to raise the cash by selling its assets (eg aircraft spare parts) for cash


Are back wages and severance payments ahead of secured creditors in liquidation priority? Are the assets going to bring enough (in this market) to pay severance and secured creditors in full?
 
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lightsaber
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:21 pm

LAX772LR wrote:
MrGtheSheepA346 wrote:
Could Ethiopian be a contender to take over SAA? Given their shared Star Alliance membership it doesn’t seem that unlikely

Why do you believe that co-involvement in a loose arrangement of codeshares+marketing, would prompt ET to sink money into a black-hole pit from which it can't possibly expect to see a return on investment?

Anyone entering the South Africa market needs to start from scratch with modern procedures, staffing levels, and with aircraft they already have economy of scale.

SAA is done. Much of these threads will be like Jet Airways threads hoping for a savior. Unfortunately, SAA is not in condition to be saved.

Lightsaber
IM messages to mods on warnings and bans will be ignored and nasty ones will result in a ban.
 
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lightsaber
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Re: Updated: SAA shrinks even further, laying off staff

Sat Apr 18, 2020 10:24 pm

MIflyer12 wrote:
davidjohnson6 wrote:
I think the terms are 1 month pay plus a week for each year of service. A person with 10 years service get 1 month plus 10 weeks pay - or about 14 weeks pay. This is subject to SAA being able to raise the cash by selling its assets (eg aircraft spare parts) for cash


Are back wages and severance payments ahead of secured creditors in liquidation priority? Are the assets going to bring enough (in this market) to pay severance and secured creditors in full?

Secured creditors have right to the pledged collateral first. If anything disrupts that, bank lending is completely undermined and the rest of the economy cannot restart. For otherwise it is not a secured loan.

Lightsaber
IM messages to mods on warnings and bans will be ignored and nasty ones will result in a ban.
 
Thibault973
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 2:32 am

PatrickZ80 wrote:
Thibault973 wrote:
I have never flown SAA but have Mango and I can say that it was probably the worst service I witnessed in a longggg time (only worse airline I might think of being Surinam Airways).


What would you expect, they're a low-cost airline. A bit like the Ryanair of South Africa. People don't fly Mango for it's service, they fly it for it's low prices.


Aircraft interior was run down to the core, not even a good morning from the crew when entering the aircraft. They spent the whole flight chit chatting in the back with one male FA half lying down with his feet on the emergency door mechanism. When I asked for a pen, they clearly couldn't be bothered. I've flown Ryanair manyyyyyy times, as I have most LCCs in Europe, North and South America and never have I witnessed such a rude behavior. Tbh I found customer service to be pretty horrid all over South Africa. And I am from Paris so that's pretty telling.
 
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aemoreira1981
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 3:08 am

lightsaber wrote:
LAX772LR wrote:
MrGtheSheepA346 wrote:
Could Ethiopian be a contender to take over SAA? Given their shared Star Alliance membership it doesn’t seem that unlikely

Why do you believe that co-involvement in a loose arrangement of codeshares+marketing, would prompt ET to sink money into a black-hole pit from which it can't possibly expect to see a return on investment?

Anyone entering the South Africa market needs to start from scratch with modern procedures, staffing levels, and with aircraft they already have economy of scale.

SAA is done. Much of these threads will be like Jet Airways threads hoping for a savior. Unfortunately, SAA is not in condition to be saved.

Lightsaber


Also something I missed in an earlier post: there must be a minimum of 75 percent ownership by South African citizens. FlySafair (which only flies domestic routes in South Africa) was delayed in starting scheduled service (it did so with the B738s coming off lease from South African Airways, which were owned by Safair's parent ASL Aviation Group) because it had to restructure its ownership. If Ethiopian wanted to start scheduled service with a South African base, it would have to partner with South African investors for a South African unit and then register aircraft on the South African registry. This is why I believe that once South African Airways finally collapses, there will be no South African airline company doing longer than medium-haul, although I expect someone to serve Central Africa areas like Rwanda, Uganda, and Brazzavile, probably Airlink (Airlink flies to Uganda, but it typically operates under a South African flight number) if it can secure additional Embraer 190AR capacity (Airlink leases all of its E190s, currently from Nordic Aviation Capital and Embraer directly). Coastal areas by Nigeria, Ghana, and the Ivory Coast could come when the MAX is able to fly again.
 
davidjohnson6
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 3:23 am

Why does a South African airline need to be 75% owned by South African passport holders ? If this is set by the Govt, it sounds like an attempt in the past to protect SAA from possible competitors. Perhaps the Govt might want to lower the barrier to 50.1 % ownership instead to encourage non-S.African resident companies to invest in any future medium and long haul carrier
 
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aemoreira1981
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 4:03 am

davidjohnson6 wrote:
Why does a South African airline need to be 75% owned by South African passport holders ? If this is set by the Govt, it sounds like an attempt in the past to protect SAA from possible competitors. Perhaps the Govt might want to lower the barrier to 50.1 % ownership instead to encourage non-S.African resident companies to invest in any future medium and long haul carrier

It is mentioned in this article: https://mg.co.za/article/2013-10-08-fly ... st-flight/
 
evanb
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 7:34 am

aemoreira1981 wrote:
Ethiopian is one of the rare African carriers that does long-haul that is usually profitable. If Africa ever had an open skies agreement, Ethiopian would be effectively a pan-African carrier.


You're missing the key ingredients to ET's success, dramatically low wages compared to the carriers it competes with and an unusually low cost of capital through indirect subsidies. While its government is hands off from an operational and strategic perspective it is very "supportive" in other ways which make the business model viable.
 
evanb
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Re: Updated: SAA shrinks even further, laying off staff

Sun Apr 19, 2020 7:45 am

aemoreira1981 wrote:
FlySafair (which only flies domestic routes in South Africa) was delayed in starting scheduled service (it did so with the B738s coming off lease from South African Airways, which were owned by Safair's parent ASL Aviation Group) because it had to restructure its ownership.


Safair's first flight took place in Oct 2014. The 3x SAA B738s arrived a year later.

aemoreira1981 wrote:
Coastal areas by Nigeria, Ghana, and the Ivory Coast could come when the MAX is able to fly again.


I think you're being overly optimistic about the MAX's capabilities operating at 5,700ft AMSL. The -8 will leave behind about 5t to 10t of payload. That would dramatically reduce the range given its MTOW is only about 82t. That might not be a problem on shorter routes, but it'll eat into the paying payload on something like JNB-LOS or JNB-ACC.

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