Gordhan says SAA in ‘intense discussions’ with lenders, calls on public to buy tickets


Minister of Public Enterprises Pravin Gordhan has said that cash-strapped airline SAA is in intense discussions with lenders to secure much-needed funding and will go through a "radical restructuring process" to ensure its financial and operational sustainability.

Gordhan, in a statement on Sunday afternoon, said a weeklong strike by members of National Union of Metalworkers of SA and the SA Cabin Crew Association had "caused immense damage to the reputation, operations, and the deterioration of the finances of SAA".

The strike, which cost the airline an estimated R50m per day, ended on November 22.

The finance minister's latest statement comes after Flight Centre on Thursday said it would stop selling SAA tickets until "certainty" returned to the market.

Both Santam and Hollard insurance have withdrawn insolvency cover benefit on SAA tickets.

Support the airline

Gordhan on Sunday said it was the "collective responsibility as South Africans to support SAA in its efforts to restore sales confidence among its customer base and rebuild revenues in the shortest possible time".

"We therefore reassure customers and encourage them to buy tickets with confidence. 

"SAA is determined to remain open for business. Management is also committed to ensure financial sustainability going forward."

SAA's board and management would intensify marketing campaigns to rebuild confidence, said Gordhan. He added that the airline's leadership would be taking "bold initiatives to increase its market share," without providing further details.

Gordhan did not say which lenders the flag carrier is in discussions with. In mid-November the minister said that while the government as committed to saving SAA, there was no room for further bailouts.

"Even if there were funds available, there is no legal mechanism to provide funding to SAA in the current year," he said after meeting with striking workers on November 19.

Finance Minister Tito Mboweni, meanwhile, presenting his mid-term budget in late October, announced that the state would no longer be bailing out state-owned enterprises, but would be open to providing loans that had to be paid back with interest.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders