The low-cost carrier announced earlier that it had applied for business liquidation, and that all of its flights had been grounded.
Comair chief executive Erik Venter said 10 out of 11 private airlines launched in South Africa since the industry was deregulated in 1991 had failed.
"Due to the less efficient fleet it operated, the ultimate closure of 1time was inevitable," he said in a statement.
"However, we are certain that in the absence of state-subsidised Mango, 1time would have made adequate profits to upgrade its fleet and be sustainable over the long term."
Democratic Alliance spokesperson on public enterprises Natasha Michael said in a statement the that it was "a blow to South African consumers and proof of the devastating effect of the anti-competitive behaviour of state-backed South African Airways (SAA), SA Express and Mango airlines".
“The DA strongly believes that the domestic airline market will continue to suffer until such time as the Competition Commission addresses the unfair competition and anti-competitive behaviour of state carriers that are able to rely on government bail-outs and are effectively subsidised to squeeze out independent players,” Michael said.
1time had about R320m in short-term debt and had been in negotiations with creditors since March.
"It is...with the utmost regret, disappointment and heartfelt disbelief that we have to file for liquidation, which means the end of a dream and an era for all of us," 1time chief executive Blacky Komani said in the company's statement.
"I sincerely thank our employees who worked so hard over the years to drive 1time's business... and our passengers, who carried and maintained 1time during our most difficult and trying financial times. Your loyalty is appreciated," Komani said.
Venter said it was "unfortunate" that the airline had closed on a Friday, when the seats of most other airlines had already been booked.
"There is therefore very little that Comair can do to assist stranded 1time passengers," he said.
"It is also sad to see that around 1 000 1time staff have lost their jobs at a time when job creation is a national imperative."
He said Comair would have to put up resistance to "unfair competition" from SA Airways and Mango.
"This is not new to us... we have been dealing with this for most of our history."