jnev3289 wrote:

No words...

I spent hours trying to better express the stupidity of this bail out right after another bail out..

You win.

I wonder why SA even bothers with the farce that SAA is a quasi-private enterprise? They should simply nationalize it completely and call it a day.
Nothing shameful with having state owned airlines.

mercure1 wrote:

I wonder why SA even bothers with the farce that SAA is a quasi-private enterprise? They should simply nationalize it completely and call it a day.
Nothing shameful with having state owned airlines.

Um, it is 100% nationalized and has been since Swissair went under.

I'm sure AA/DL/UA are already working to kill the Open Skies agreement. Wait, I'm hearing they aren't and they don't care one iota. Hmm...Funny that...

SAA is indeed a fully government owned, however like other long list SOEs (State-Owned Enterprises) in South Africa it operates largely as a typicall commercial enterprise retaining its own legal and financial structure and is tasked to participate in normal commercial activities with government being the primary shareholder.

So yes the airline was nationalized in the ownership sense, but it still (maybe not very effectively) is more a typical commercial enterprise hence why we keep hearing about its financial travails and boardroom drama.

Personally, in my book, there indeed is no shame in being a fully government-owned airline - that is quite normal globally and where the airline can serve for broader national benefit, but it seems to me this messy middle state SAA finds itself hardly ideal.

LAXintl wrote:

Personally, in my book, there indeed is no shame in being a fully government-owned airline - that is quite normal globally and where the airline can serve for broader national benefit, but it seems to me this messy middle state SAA finds itself hardly ideal.

Which is why the MidEast brouhaha is a joke. Over half of the world's ASMs are on fully or partially State owned airlines. Ironically, the largest country with fully government owned airports is the US of A.

LAXintl wrote:

SAA is indeed a fully government owned, however like other long list SOEs (State-Owned Enterprises) in South Africa it operates largely as a typicall commercial enterprise retaining its own legal and financial structure and is tasked to participate in normal commercial activities with government being the primary shareholder.

So yes the airline was nationalized in the ownership sense, but it still (maybe not very effectively) is more a typical commercial enterprise hence why we keep hearing about its financial travails and boardroom drama.

Personally, in my book, there indeed is no shame in being a fully government-owned airline - that is quite normal globally and where the airline can serve for broader national benefit, but it seems to me this messy middle state SAA finds itself hardly ideal.

They are registered as a "limited liability company", meaning they are regulated under the Companies Act 2008, however, with the additional designation "state-owned company", which means they are also bound by the Public Finance Management 1999. A normal limited liability company would be designated as South African Airways Ltd., but since they are a state-owned company they are designated as South African Airways SOC Ltd. All state entities that trade in commercial markets must be registered and operate like this - there is no distinction in South Africa.

TerminalD wrote:

LAXintl wrote:

Personally, in my book, there indeed is no shame in being a fully government-owned airline - that is quite normal globally and where the airline can serve for broader national benefit, but it seems to me this messy middle state SAA finds itself hardly ideal.

Which is why the MidEast brouhaha is a joke. Over half of the world's ASMs are on fully or partially State owned airlines. Ironically, the largest country with fully government owned airports is the US of A.

Indeed, nearly every commercial airport in the US is state-owned, often by local authorities. They also receive FAA grants for infrastructure (a subsidy). The funny thing in South Africa is that while SAA is in shambles the major commercial airports are owned by a state-owned company (Airports Company South Africa) that does very, very well without any government assistance. They even have management contracts for foreign airports (Sao Paulo-Guarulhos, Mumbai and Accra).

The Emperors New Clothes. Which institution will finally be the small boy who calls "naked!"?

Not Surprising

As expected, some regional SAA routes are being scaled back.

"Tourism Update states the airline sent out a notification to trade last week, confirming it "will cut flights to Brazzaville via Pointe Noire in the Congo; Douala in Cameroon via Libreville in Gabon; Kinshasa in the DRC; Entebbe in Uganda; Luanda in Angola; Cotonou in Benin via Libreville in Gabon".

http://www.msn.com/en-za/travel/news/sa ... spartanntp

At the moment they're only cutting frequency on those destinations...some like BZV, PNR and DLA will end up with only 1 flight a week...not a very clever move also imho...keeping a station open for just 1 weekly flight (BZV and PNR as a triangular routing also)

readytotaxi wrote:

Hands up who wants to join their FF programe

I stopped putting miles on my voyager account long ago.

The National Treasury transferred another R3 billion from the National Revenue Fund to the airline to help it repay part of a loan from Citibank, due today.

At the same time, Treasury Director General Dondo Mogajane said the money is not a loan, but a recapitalisation. SAA won’t have to repay any of the R10 billion it will receive in guarantees and cash from government coffers this year.

http://ewn.co.za/2017/09/30/bailout-giv ... e-treasury

LAXintl wrote:

The National Treasury transferred another R3 billion from the National Revenue Fund to the airline to help it repay part of a loan from Citibank, due today.

At the same time, Treasury Director General Dondo Mogajane said the money is not a loan, but a recapitalisation. SAA won’t have to repay any of the R10 billion it will receive in guarantees and cash from government coffers this year.

http://ewn.co.za/2017/09/30/bailout-giv ... e-treasury

Wish the Treasury Director General would honest to call it what it really is...just wasting money away from the SA taxpayers that could have been spent on more worthwhile projects like healthcare or education for its voters.

LAXintl wrote:

The National Treasury transferred another R3 billion from the National Revenue Fund to the airline to help it repay part of a loan from Citibank, due today.

At the same time, Treasury Director General Dondo Mogajane said the money is not a loan, but a recapitalisation. SAA won’t have to repay any of the R10 billion it will receive in guarantees and cash from government coffers this year.

http://ewn.co.za/2017/09/30/bailout-giv ... e-treasury

That's so sickening

A lot of SAA's debt has now been paid off. This brings their overall costs down and bodes well for the eventual restructuring under the new CEO. Once all is said and done, SAA needed to be recapitalised. Paying off a big portion of it's massive debt effectively did that. More money is now free to be used as operating capital.

evanb wrote:

Indeed, nearly every commercial airport in the US is state-owned, often by local authorities. They also receive FAA grants for infrastructure (a subsidy). The funny thing in South Africa is that while SAA is in shambles the major commercial airports are owned by a state-owned company (Airports Company South Africa) that does very, very well without any government assistance. They even have management contracts for foreign airports (Sao Paulo-Guarulhos, Mumbai and Accra).

Speaking only of the South African airports ... they have a natural monopoly. If you want to fly to J'burg, you realistically need to use their airport. Therefore they can charge whatever fee they need to cover their costs, regardless of how good or bad their cost structure is.

That the Airports Company South Africa makes a profit says little about their cost structure.

The airline, on the other hand, operates on a competitive marketplace that causes airlines with a high cost structure to take a loss. Very different thing.

kitplane01 wrote:

evanb wrote:

Indeed, nearly every commercial airport in the US is state-owned, often by local authorities. They also receive FAA grants for infrastructure (a subsidy). The funny thing in South Africa is that while SAA is in shambles the major commercial airports are owned by a state-owned company (Airports Company South Africa) that does very, very well without any government assistance. They even have management contracts for foreign airports (Sao Paulo-Guarulhos, Mumbai and Accra).

Speaking only of the South African airports ... they have a natural monopoly. If you want to fly to J'burg, you realistically need to use their airport. Therefore they can charge whatever fee they need to cover their costs, regardless of how good or bad their cost structure is.

That the Airports Company South Africa makes a profit says little about their cost structure.

The airline, on the other hand, operates on a competitive marketplace that causes airlines with a high cost structure to take a loss. Very different thing.

Most airports in the world bar a few examples are natural monopolies, even in cities/places with multiple airports they are often owned by the same operator (e.g. New York, Chicago, Paris, Sao Paulo, Istanbul, Milan, Washington). ACSA cannot charge whatever they want since their fees are regulated and the regulator has regularly denied them the fee increases that they ask for. Further to this, ACSA's fees are highly competitive when compared to many other airports and they have not received infrastructure subsidies from government.

This just tweeted by SA’s National Treasury

DG: During Budget, it was decided that it important that we recapitalize SAA to the tune of R13 billion for working capital. @Radio702

evanb wrote:

kitplane01 wrote:

evanb wrote:

Indeed, nearly every commercial airport in the US is state-owned, often by local authorities. They also receive FAA grants for infrastructure (a subsidy). The funny thing in South Africa is that while SAA is in shambles the major commercial airports are owned by a state-owned company (Airports Company South Africa) that does very, very well without any government assistance. They even have management contracts for foreign airports (Sao Paulo-Guarulhos, Mumbai and Accra).

Speaking only of the South African airports ... they have a natural monopoly. If you want to fly to J'burg, you realistically need to use their airport. Therefore they can charge whatever fee they need to cover their costs, regardless of how good or bad their cost structure is.

That the Airports Company South Africa makes a profit says little about their cost structure.

The airline, on the other hand, operates on a competitive marketplace that causes airlines with a high cost structure to take a loss. Very different thing.

Most airports in the world bar a few examples are natural monopolies, even in cities/places with multiple airports they are often owned by the same operator (e.g. New York, Chicago, Paris, Sao Paulo, Istanbul, Milan, Washington). ACSA cannot charge whatever they want since their fees are regulated and the regulator has regularly denied them the fee increases that they ask for. Further to this, ACSA's fees are highly competitive when compared to many other airports and they have not received infrastructure subsidies from government.

I'm glad their regulated.

But that they are owned by the government, and the government sets their prices, and they make a profit, does not mean they have a good cost structure. Maybe they do, but this is not evidence.

When you say "fees are highly competitive when compared to other airports" do you mean Nigeria or the Netherlands or Namibia?

I would not want to consider Nigeria my benchmark because of their reputation for ineptitude. I would not want to consider the Netherlands my benchmark because of labor costs. Maybe Namibia? It's not obvious. South Africa is kind of a unique country.

kitplane01 wrote:

I'm glad their regulated.

But that they are owned by the government, and the government sets their prices, and they make a profit, does not mean they have a good cost structure. Maybe they do, but this is not evidence.

When you say "fees are highly competitive when compared to other airports" do you mean Nigeria or the Netherlands or Namibia?

I would not want to consider Nigeria my benchmark because of their reputation for ineptitude. I would not want to consider the Netherlands my benchmark because of labor costs. Maybe Namibia? It's not obvious. South Africa is kind of a unique country.

The regulation model requires them to present cost data as well as international comparison as well as feedback from stakeholders. Courts have oversight of it. There is a brief description of it on the web: http://www.airports.co.za/business/economic-regulation

Since fees are differentiated between domestic, regional (only Botswana, Namibia, Lesotho and Swaziland) and international, one can make direct comparisons and don't need to make ridiculous comparisons to Nigeria and Netherlands. A few years back, around 2010, there were complaints that ACSA put its fees up steeply in response to the boom in capital spending for the 2010 World Cup since they did not receive any funding from the government for new terminals in Johannesburg, Cape Town and the new airport in Durban.

You keep bringing up cost structure as if you know its bad and arguing that it does not have a good cost structure, but it's a red herring since you are playing an assumption that the cost structure is bad because they're a profitable monopoly. You're advancing a narrative on assumption rather than data. Firstly, a disproportionately large number of airports are natural monopolies, secondly, there are competitive options in some cases in South Africa (e.g. Lanseria and Wonderboom for Johannesburg, Margate and Pietermaritzburg for Durban). The IATA Aviation Charges Intelligence Center data shows ACSA to be quite competitive (data is proprietary, so can't post it).

kitplane01 wrote:

I would not want to consider Nigeria my benchmark because of their reputation for ineptitude. I would not want to consider the Netherlands my benchmark because of labor costs. Maybe Namibia? It's not obvious. South Africa is kind of a unique country.

I don't think South Africa is that unique. You can compare it to most middle-income countries, and particularly to places like Brazil, Argentina, Turkey, Morocco, Tunisia, Algeria, Colombia, Mexico, Thailand.

evanb wrote:

kitplane01 wrote:

I'm glad their regulated.

But that they are owned by the government, and the government sets their prices, and they make a profit, does not mean they have a good cost structure. Maybe they do, but this is not evidence.

When you say "fees are highly competitive when compared to other airports" do you mean Nigeria or the Netherlands or Namibia?

I would not want to consider Nigeria my benchmark because of their reputation for ineptitude. I would not want to consider the Netherlands my benchmark because of labor costs. Maybe Namibia? It's not obvious. South Africa is kind of a unique country.

The regulation model requires them to present cost data as well as international comparison as well as feedback from stakeholders. Courts have oversight of it. There is a brief description of it on the web: http://www.airports.co.za/business/economic-regulation

Since fees are differentiated between domestic, regional (only Botswana, Namibia, Lesotho and Swaziland) and international, one can make direct comparisons and don't need to make ridiculous comparisons to Nigeria and Netherlands. A few years back, around 2010, there were complaints that ACSA put its fees up steeply in response to the boom in capital spending for the 2010 World Cup since they did not receive any funding from the government for new terminals in Johannesburg, Cape Town and the new airport in Durban.

You keep bringing up cost structure as if you know its bad and arguing that it does not have a good cost structure, but it's a red herring since you are playing an assumption that the cost structure is bad because they're a profitable monopoly. You're advancing a narrative on assumption rather than data. Firstly, a disproportionately large number of airports are natural monopolies, secondly, there are competitive options in some cases in South Africa (e.g. Lanseria and Wonderboom for Johannesburg, Margate and Pietermaritzburg for Durban). The IATA Aviation Charges Intelligence Center data shows ACSA to be quite competitive (data is proprietary, so can't post it).

I have no idea if their cost structure is good or bad. That's what the "maybe" above means.

I don't have a "narrative". Actually, I know very little about South African airports, and am learning from you. Thanks

Why do they charge different rates for a plane coming from with South Africa, from Namibia, and from the UK? It would seem that rates different from costs, since these planes would have the same costs (not including immigration. But even Namibia and the UK both have to go through immigration, so those should be the same costs.)

The trouble with gov't bailout's is there is a tendency (whatever country) for corporations to just carry on expecting the inevitable next bailout further down the line.
I would emagine that SA has enough business to create a workable business model.But if they can't/won't you just have to be prepared to let them go/sell it.If you don't they 'know' another bailout will be given.
Sadly the state the SA govt is in at the moment it is the latter that will probably happen and the taxpayer will pay.
Perhaps Italy is a good example of how not to do it.

parapente wrote:

The trouble with gov't bailout's is there is a tendency (whatever country) for corporations to just carry on expecting the inevitable next bailout further down the line.
I would emagine that SA has enough business to create a workable business model.But if they can't/won't you just have to be prepared to let them go/sell it.If you don't they 'know' another bailout will be given.
Sadly the state the SA govt is in at the moment it is the latter that will probably happen and the taxpayer will pay.
Perhaps Italy is a good example of how not to do it.

AFAIK there is no regulatary body that polices these so called handouts. And reading some recent newspaper articles the current leadership at SAA leaves a lot to be desired. Some of their decisions would make a great comedy!

scotron11 wrote:

parapente wrote:

The trouble with gov't bailout's is there is a tendency (whatever country) for corporations to just carry on expecting the inevitable next bailout further down the line.
I would emagine that SA has enough business to create a workable business model.But if they can't/won't you just have to be prepared to let them go/sell it.If you don't they 'know' another bailout will be given.
Sadly the state the SA govt is in at the moment it is the latter that will probably happen and the taxpayer will pay.
Perhaps Italy is a good example of how not to do it.

AFAIK there is no regulatary body that polices these so called handouts. And reading some recent newspaper articles the current leadership at SAA leaves a lot to be desired. Some of their decisions would make a great comedy!

I'm looking forward to AA, DL, and UA's infomercial on how this subsidy steals millions of American jobs though

kitplane01 wrote:

Why do they charge different rates for a plane coming from with South Africa, from Namibia, and from the UK? It would seem that rates different from costs, since these planes would have the same costs (not including immigration. But even Namibia and the UK both have to go through immigration, so those should be the same costs.)

Botswana, Lesotho, Namibia, South Africa and Swaziland are part of the Southern African Customs Union. As part of the customs union agreement they are considered domestic for trade and customs purposes, but as you say, since they still require immigration they need to use the international rather than domestic facilities, hence they are charged rates somewhere between domestic and international rates. This arrangement is reciprocal. I think this would apply to non-ACSA airports as well.

Parliment looks into legality of treasury bailout after claim it was in breach of public finance rules by not using the normal appropriation process.

https://citizen.co.za/news/south-africa ... ut-to-saa/
http://ewn.co.za/2017/10/03/treasury-as ... aa-bailout

Consultancy Airline Management Group might be brought in to assist with restructuring
https://www.thenational.ae/business/sou ... y-1.664305

Appropriate or not, not sure how they would claw the money back from SAA since its gone almost directly to pay off bank debt.

SAA expect to face cash crisis again at the end of the month as when the repayment of loans of R5bn is due.

The Treasury has already bailed out SAA twice since June: first to repay a Standard & Chartered loan of R2.2bn and then to repay a Citibank loan of R1.76bn.

New, R5bn debt crisis looms for South African Airways
https://www.businesslive.co.za/bd/compa ... s-for-saa/


Add to the troubles, according to a legal opinion provided to Parliament’s Finance Committee previous R3 billion funding for SAA might not be compliant with law.

'SAA BAILOUT MAY NOT BE FULLY COMPLIANT WITH THE LAW'
http://ewn.co.za/2017/10/17/saa-bailout ... th-the-law

=

Will this saga never end?
SAA will always have some sort of loan or debt to pay off, which seemingly the government must now cover.

There seems to be some movement today. It looks like Dudu Myeni is out as chairperson of the board, then again she shouldn't have been there since there is a time limit, or supposed to be, but she wanted to stay in place until Jacob Zuma left his post in 2019. Whether this will change anything is up in the air, but at least one of the problems that the banks and lenders were campaigning against is out.

SAA chair Dudu Myeni out

mercure1 wrote:

Will this saga never end?
SAA will always have some sort of loan or debt to pay off, which seemingly the government must now cover.

If a company gets subsidies, it will be managed to need them.

Let SAA fail. That is the smart solution.

Lightsaber

enzo011 wrote:

There seems to be some movement today. It looks like Dudu Myeni is out as chairperson of the board, then again she shouldn't have been there since there is a time limit, or supposed to be, but she wanted to stay in place until Jacob Zuma left his post in 2019. Whether this will change anything is up in the air, but at least one of the problems that the banks and lenders were campaigning against is out.

SAA chair Dudu Myeni out

Well at least the replacement can't be any worse. Hopefully JZ will be out before then too.

Thanks for the link.I also read the 'read on' article.I noted with amusement that the new board shuffles have finally brought in an (quote) 'Aviation expert'.Now you might have thought they would have come up with this astounding idea before!
Sadly the spokesperson for the democratic part put the whole thing in stark terms on just how much extra money will really be needed (think he said circa 10 mill' rand.).He summed up 'too little too late' that in his opinion the airline was doomed-this year.

Sadly you can bet many of these millions will have found their way into various 'other' pockets.Its symptomatic of what is going on through SA.
The only answer is for SAA (if anybody will take it on) to be sold to a global group like IAG.But I fear nobody would.Not just because of the deep and continuing losses but because of the deep and continuing corruption.

SAA receives another capital injection.

South African Airways (SAA) welcomes the announcement of a capital injection made by government for the airline today. The injection will go a long way to stabilise the airline financially and will help restore the confidence of all stakeholders in the operational sustainability of the company.

http://newsroom.aviator.aero/capital-in ... gthen-saa/

SAA says thank you for the recent R10 billion (USD $709 million), but the airline still remains undercapitalized and in need of another R9 billion still.

SAA REMAINS UNDER-CAPITALISED, DESPITE BAILOUT
http://ewn.co.za/2017/11/21/south-afric ... te-bailout
https://www.cnbcafrica.com/news/souther ... e-bailout/

=

LAXintl wrote:

SAA says thank you for the recent R10 billion (USD $709 million), but the airline still remains undercapitalized and in need of another R9 billion still.

SAA REMAINS UNDER-CAPITALISED, DESPITE BAILOUT
http://ewn.co.za/2017/11/21/south-afric ... te-bailout
https://www.cnbcafrica.com/news/souther ... e-bailout/

=

Sickening

LAXintl wrote:

SAA says thank you for the recent R10 billion (USD $709 million), but the airline still remains undercapitalized and in need of another R9 billion still.

Where do either of the articles say or suggest they're in need of another R9 billion? Of course they still have a negative equity position since the R10 billion is only being paid over several months. It only reflects on the balance sheet when received.

Per daily email news summary I receive:


South African Airways stated in Parliamentary Commission testimony that the airlines capital needs continue with an estimated projected deficit of US$641 million over the next 12 months even with a recent government injection of US$709 million.

mercure1 wrote:

South African Airways stated in Parliamentary Commission testimony that the airlines capital needs continue with an estimated projected deficit of US$641 million over the next 12 months even with a recent government injection of US$709 million.

But no indication of how that would be financed, including off balance sheet leasing of aircraft, new shareholder, funds trapped in other countries (e.g. Angola, Nigeria and Zimbabwe). It's a vague statement that is being interpreted as something very specific.

SA as a nation is in deep financial trouble. Nine of South Africa’s state-owned entities have racked up debt of close to R700bn in the 2015-’16 financial year on which they had to pay R51bn worth of interest. That number is surely to be even higher for the 2016-17 financial year. As for SAA, they account for a total of 13.7 billion rand ($984.87 million) in bailouts alone this past year. At some point, the government is going to have to cut the cord, and just let the airline become insolvent. Let it go into receivership and it can re-organize under new ownership. This will be devastating for the employees for SA, but the alternative is it being devastating for the entire nation as a whole. In the meantime, SA needs to park their entire A340 fleet, drop all long haul routes except LHR and focus on flying regionallywithin the bottom half of Africa.

piedmontf284000 wrote:

In the meantime, SA needs to park their entire A340 fleet, drop all long haul routes except LHR and focus on flying regionallywithin the bottom half of Africa.

Parking the A340s will do nothing to fix the governance problems. Also, why keep LHR, it's one of the worst performing long-haul routes for them?

evanb wrote:

piedmontf284000 wrote:

In the meantime, SA needs to park their entire A340 fleet, drop all long haul routes except LHR and focus on flying regionallywithin the bottom half of Africa.

Parking the A340s will do nothing to fix the governance problems. Also, why keep LHR, it's one of the worst performing long-haul routes for them?

Because you can't park the entire fleet, so you might as well park the one's that cost the most to operate. Yes, it will do nothing to fix the governance issues, but they have to start somewhere...anywhere... to reduce costs. They can't keep doing the status quo. As for LHR, the majority of South Africa's global distribution lies in Europe. The flight to LHR is an important one if for none other then their financial ties to London and the fact it is the financial center of Europe.

piedmontf284000 wrote:

evanb wrote:

piedmontf284000 wrote:

In the meantime, SA needs to park their entire A340 fleet, drop all long haul routes except LHR and focus on flying regionallywithin the bottom half of Africa.

Parking the A340s will do nothing to fix the governance problems. Also, why keep LHR, it's one of the worst performing long-haul routes for them?

Because you can't park the entire fleet, so you might as well park the one's that cost the most to operate. Yes, it will do nothing to fix the governance issues, but they have to start somewhere...anywhere... to reduce costs. They can't keep doing the status quo. As for LHR, the majority of South Africa's global distribution lies in Europe. The flight to LHR is an important one if for none other then their financial ties to London and the fact it is the financial center of Europe.

Parking planes with higher operational costs but which are cheap to lease or owned an written down to zero, or parking planes with lower operational costs but high lease payments? Unless you actually know the lease costs or ownership structures it's difficult to make these sorts of judgments. They're already in the process of returning at least five leased A340s but they'll likely hang onto the owned ones for some time since they've be written down to zero a long time ago.

They have four flights per day to Europe, two to LHR and two to FRA and MUC. The LHR ones have been bleeding money for years while the FRA and MUC flights do decently. If anything they'll cut some of the LHR flights, and keep FRA and MUC. Yes, they have strong ties to the UK, but that doesn't mean that it's automatically a strong or viable route.

andrefranca wrote:

Poor SA, as a Brazilian I feel we`re sharing the same drowning boat....

Everything is cyclical - SA and Brasil will rise again....just keep working hard for a better world. Don't give up.

I had the chance to fly SAA in 2015 and I was impressed! the food was good, the service spot on and the planes nicely furnished. it is a good product if all works out. Good luck SAA

Jawaiiansky66 wrote:

andrefranca wrote:

Poor SA, as a Brazilian I feel we`re sharing the same drowning boat....

Everything is cyclical - SA and Brasil will rise again....just keep working hard for a better world. Don't give up.

I had the chance to fly SAA in 2015 and I was impressed! the food was good, the service spot on and the planes nicely furnished. it is a good product if all works out. Good luck SAA

Cyclic? Really?? I was under the impression that SA has been doing a nose dive for a very long time, and shows no sign of ever pulling up. What evidence (beyond mere hope) do you see of SA ever turning around?

Government investing ... nope. Already been tried a thousand times.
New Management ... nope. SA has had so many new managers the office staff must be dizzy.
Change in market conditions ... nope. The South African economy and world airline travel next year will likely be just like last year.

kitplane01 wrote:

Cyclic? Really?? I was under the impression that SA has been doing a nose dive for a very long time, and shows no sign of ever pulling up. What evidence (beyond mere hope) do you see of SA ever turning around?

Government investing ... nope. Already been tried a thousand times.
New Management ... nope. SA has had so many new managers the office staff must be dizzy.
Change in market conditions ... nope. The South African economy and world airline travel next year will likely be just like last year.

I think he's referring to the countries, and the economies in South Africa and Brazil both being fairly cyclical, not the for. SA is a commonly used abbreviation for the country. The conversation a few posts back was about the general economic conditions in SA (i.e. South Africa).

piedmontf284000 wrote:

evanb wrote:

piedmontf284000 wrote:

In the meantime, SA needs to park their entire A340 fleet, drop all long haul routes except LHR and focus on flying regionallywithin the bottom half of Africa.

Parking the A340s will do nothing to fix the governance problems. Also, why keep LHR, it's one of the worst performing long-haul routes for them?

Because you can't park the entire fleet, so you might as well park the one's that cost the most to operate. Yes, it will do nothing to fix the governance issues, but they have to start somewhere...anywhere... to reduce costs. They can't keep doing the status quo. As for LHR, the majority of South Africa's global distribution lies in Europe. The flight to LHR is an important one if for none other then their financial ties to London and the fact it is the financial center of Europe.

Well right now they have a A340 stranded in JFK for a week with no end in sight due to fuel additives geling the fuel system which will require extensive cleaning and possibly all 4 engines changed. It will be interesting to see how it plays out considering SAA’s financial difficulties. Shipping all the equipment, engines and other parts will be quite expensive.