Velvet Sky scrambling to fly again

2012-03-07 22:38

Cape Town - Embattled low-cost carrier Velvet Sky is exploring all avenues to be able to take to the skies again, the airline's chief told the KwaZulu-Natal High Court in Pietermaritzburg on Wednesday.

The airline's CEO Dhevan Pillay, told the court, where it faced two separate applications which could affect its future, that if capital was forthcoming from a possible new investor, Velvet Sky would be able to meet its daily expenses and operate profitably within reasonable time.

He said talks with two neighbouring African countries for additional routes had taken place, and one country had agreed to allow the company in.

This route would be dollar-based, and while the costs would be about the same as internal flights, the revenue would be higher.

Maintenance service provision would be switched, saving about R2m a month.

In-flight advertising, pay-to-eat and maximisation of cargo carrying capacity could bring in about R2.5m to R3m a month.

Velvet Sky is negotiating with a bank for passengers to buy tickets on credit over a year.

The reason for the airline's debt was that it started with a business model designed to operate three aircraft.

However, it was only able to start with one aircraft as the other two were being refurbished. This cut cashflow. Only one aircraft operated until October.

Pillay was responding to assertions by the CEO Umzano Transport Services in Durban, whose company it allegedly owes more than R3.9m.

Umzano's chief executive said there was no prospect of Velvet Sky being able to pay the nearly R100m it owed creditors.

The transport company had applied in the High Court for a business rescue operator to be appointed for the airline, a fairly new measure under the Companies Act. The other application was for a winding up order.

Both applications were postponed, with no postponement date yet decided on.

  • ebadam - 2012-03-07 22:50

    just pack up shop and sell assets to pay off whatever debts can be paid..

      Donovan - 2012-03-08 00:12

      Anyone who, after this latest debacle, chooses to fly Ververt Sky, has only themselves to blame when the wheels/engines/wings fall off.

      Anthony - 2012-03-08 05:31

      stick to taxis

  • HowardThackeryEsq - 2012-03-07 22:55

    Pity that Nationwide was driven into closure. Was the only really successful independant airline. Till the engines fell off of course.

      Graham - 2012-03-08 09:40

      Nationwide's downfall goes to prove that you can't fight against the big boys like SAA (and government). Their fate was sealed as soon as they won their court case against SAA!

  • TaniaSandraSteyn - 2012-03-07 23:11

    The Airline business is cutthroat; and Acsa is taking a too-large slice of the pie.

  • Peter - 2012-03-08 03:45

    A Velvet Pie in the Sky.

  • John - 2012-03-08 05:23

    Tough business, high costs and low margins.....

      Gary - 2012-03-08 07:35

      And your major competitor can get a few billion bale-out every second year.... now who would want to be in that business?

  • brionyl.french - 2012-03-08 05:26

    Give it up Velevet sky, its clearly not meant to be...

  • Johan Grobbelaar - 2012-03-08 06:20

    It was a BBBEEE (lost track of how many B's and E's already) thing this, who EVER REALLY thought it would work? This IS Africa, after all...

  • maseratifittipaldi - 2012-03-08 06:35

    I bet this little episode created a few more ANC connected millionaires. Just another way of redirecting tax money which could have been used to uplift our people.

  • Jacqueline - 2012-03-08 06:44

    Once again a low cost carrier business model with no proper structure and support in place, not to mention financial padding to absorb the incidentals. Having worked for an airline that failed, its almost ALWAYS bad management and nothing else.

  • Magda - 2012-03-08 06:55

    When will we hear what happens o our bookings? Nobody knows whats happening. Do we book with another company> Wille we get a refund? I have to fly within a week and do not know where I stand

      theO rAcLe - 2012-03-08 08:48

      chances are you won't get refunded, next time book with a reputable company.....This is a taxi operator we are talking about.

  • Schmee - 2012-03-08 07:14

    Shouldn't they have made all these changes before they landed up in all this trouble.

  • Graham.Cooper2 - 2012-03-08 07:34

    Would you trust this airline again in the future?

      jacques.vermaak - 2012-03-08 07:41

      I would not trust any venture where Herman Van Zyl is involved

  • Stephen - 2012-03-08 07:54

    Once bitten twice shy!!!. Won't go near these bunch of crooks again.

  • Danie - 2012-03-08 08:40

    we hear that the some of the staff at Velvet sky have not jet get paid,they don`t want to reniew some of the staffs contracts but they have interviewed a lot of new staff ,What now ??????

  • Danie - 2012-03-08 08:40

    we hear that the some of the staff at Velvet sky have not jet get paid,they don`t want to reniew some of the staffs contracts but they have interviewed a lot of new staff ,What now ??????

      Deon - 2012-03-08 09:36

      Time to look at another place for a job. It would not be clever to start working for this company.

  • Danny - 2012-03-08 08:48

    "Velvet Sky's directors are Ahmed Amod (a lawyer & legal representative for Aurora Empowerment Systems - Aurora's chairman is Jacob Zuma's nephew, Khulubuse Zuma), Stephen Nthite & Dhevan Pillay."

      Mike - 2012-03-08 12:22

      Well that explains a lot....

  • hein.kaiser - 2012-03-08 09:23

    Velvet Sky is officially the greenest airline: ZERO emissions in 2 weeks haha- i agree- pack up and pay your debts

  • gembleton1 - 2012-03-08 09:45

    Sell the house the Range Rover the wife’s Porche and the kids BMW and realise as a BBEE company you will not succeed, because you spend the profits before they are made. And stop blaming every one else you run the company you are responsible.

  • Michael - 2012-03-15 22:00

    As long as Velvet Sky Airline has not paid its pilots and air hostesses their salaries since January this year, they clearly cannot have any actual intention of flying again. Just putting vital employees of an airline in dire straights, without an explanation and without taking desperate crew members telephone calls and pleas for explanation, is a sure sign that Dhevan Pillay intends flying nothing more than a flag. The senior management have been daily lying to managment crew members, who passed on these lies to their awaiting pilots and air hostesses in good faith. Salaries have not yet materialised 8 days since the High Court date with BP although crews were told the reason salaries were not being paid was because the bank account had been frozen pending the court date. There is no official letter, explanation, nor future resolution from management, other than the daily lies we received, said one pilot. Everything has gone quiet and our calls are not being taken. We dont even know if we are employed anymore or not! We are clearly not being paid for our work already done. I suggest the senior management of Velvet Sky Airline knowingly did not pay their overheads, with the specific intention of pocketing the millions of rand in monthly turnover, being cash up front from passengers, well timed over the busy festive period and are now seeking each avenue to get away with this white collar robbery. The longer they delay, the more accustomed people become to their fate.

      maseratifittipaldi - 2012-03-15 22:08

      Michael : This sounds like another Aurora type of operation. Do you perhaps know some of the cockroaches involved?

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