SAA needs board that knows aviation

2016-04-27 06:00
Unathi Henama - Social Observer

Unathi Henama - Social Observer

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ON 2 November 2012, 1Time Airline was liquidated after failing to pay for services rendered by the Airports Company of South Africa (ACSA).

Last year on 2 December, Skywise was grounded from operating, also due to their failure to pay debts to ACSA.

The demise of airlines is always tragic as these low-cost carriers were able to lower the cost of travelling.

The other advantage of airlines is that it is a high-speed transportation network that is great for business and government and has a social benefit for society.

The social benefit is linked to the ability to travel outside of Mangaung in the morning and being able to sleep at home the same night.

The high-speed transport network provided by aviation is a reflection of the benefit of technology to society. Bloemfontein is classified as a secondary city in terms of geography and this city has so much potential for growth.

The city must be open to more aviation traffic by promoting more competition to the Bram Fischer International Airport.

Another provincial capital city in South Africa that hosted games during the 2010 Fifa World Cup, formed a partnership with Velvet Sky Airways to improve aviation access. Due to this partnership, arrivals to that province increased and it led to a decrease in aviation prices.

The arrival of more airlines in Bloemfontein can be sustained by attracting more visitors and tourists.

This will lead to transport mode-switching from other slower transport forms to the fast transport network provided by aviation.

In the book Flashes of Thought by Mohammed Bin Rashid Al Maktoum, he wrote about how Emirates, one of the largest airlines today, was established. He reflected on how the open skies policy that Dubai had adopted, was challenged by the airline that controlled more than 70% of the traffic, who requested that the open skies be shelved. But that was turned down by Dubai.

According to Maktoum, “the first lesson to be learnt is that competition always makes you stronger and better. Competition is feared only by the weak’’.

One of the major challenges is that the laws governing airline ownership require that 75% of domestic airlines must be owned by locals.

This makes the domestic aviation industry unattractive for foreign direct investment (FDI).

FlySafair, one of the latest low-cost carriers to be launched, was interdicted until it restructured its ownership structure.

FlySafair is now operating successfully.

The demise of Skywise Airline may have resulted in the South African public becoming wary of newer airlines. This may cause South Africa to become more loyal to the national carrier.

South African Airways (SAA) is not the challenge as privatisation coalition would make us believe. Privatisation is not the panacea for lack of efficiency at SAA. The air fleet needs proper management and a well-functioning board that understands the aviation industry.

  • Telkom is a state-owned enterprise (SOE) that has a proper management and a well-functioning board. Telkom was one of the best-performing shares on the Johannesburg Stock Exchange (JSE). To comment on the issue highlighted here, go to

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