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readytotaxi wrote:Wow, didn't realise how bad things were for SAA, if I were Standard Charter I would want out completely.
LAXintl wrote:Well exactly what was supposed to happen, happened - the government which guaranteed the loan paid for it.
But agree SA is a financial basket case and sadly growing drain on the nation. Not sure what the answer is.
gunnerman wrote:Instead of SA making money and paying taxes to the hard-pressed government, it's a basket case which keeps needing government handouts. It's loss for the year to March 2017 is apparently ZAR4.5bn (about US$337.5m). The airline has a culture of not being focused on getting the job done, a situation which will not get better until a competent person replaces Dudu Myeni as the chairperson of the board.
MIflyer12 wrote:Banks (and equity funds) go looking for risk to get higher yields. It seems Standard Chartered has - thus far - played this one right: the SA government stepped in to prevent a default.
Some risks can't be measured with precision or efficiently mitigated, however. See Icarus myth.
LAXintl wrote:But agree SA is a financial basket case and sadly growing drain on the nation. Not sure what the answer is.
Aaron747 wrote:LAXintl wrote:But agree SA is a financial basket case and sadly growing drain on the nation. Not sure what the answer is.
There is only one answer: the hopelessly corrupt ANC need to fall or be removed from power before they completely ruin SAA and the economy at large.
SamYeager2016 wrote:Aaron747 wrote:LAXintl wrote:But agree SA is a financial basket case and sadly growing drain on the nation. Not sure what the answer is.
There is only one answer: the hopelessly corrupt ANC need to fall or be removed from power before they completely ruin SAA and the economy at large.
What guarantee is there that the replacement government will be any better? It really sounds as if corruption has become endemic in SA and a change of government doesn't make that attitude vanish overnight.
shankly wrote:The ME3/Chinese also appear to be keeping their distance; maybe waiting to snap up the inevitable demised SAA scraps for a token R1?
Planeflyer wrote:Most people only remember the ANC has freedom fighters and forget the hardcore Marxist ideology that was at the core of the group. God help SA
NichCage wrote:If South Africans Airways didn't exist, other airlines would pick up the slack. Maybe a few destinations from JNB would be lost (such as Munich, Perth, Sao Paulo) but other airlines would take over instead.
cathay747 wrote:Seems incredible that an airline like SAA can't be sustainably profitable. So sad. SA = AZ of Africa.
DDR wrote:cathay747 wrote:Seems incredible that an airline like SAA can't be sustainably profitable. So sad. SA = AZ of Africa.
South Africa has the problem of being geographically located too far south to be a proper African hub.
DDR wrote:South Africa has the problem of being geographically located too far south to be a proper African hub.
NichCage wrote:If South Africans Airways didn't exist, other airlines would pick up the slack. Maybe a few destinations from JNB would be lost (such as Munich, Perth, Sao Paulo) but other airlines would take over instead.
gunnerman wrote:DDR wrote:cathay747 wrote:Seems incredible that an airline like SAA can't be sustainably profitable. So sad. SA = AZ of Africa.
South Africa has the problem of being geographically located too far south to be a proper African hub.
SA is similar to QF, whose hub at SYD, in being an end-of-line and point-to-point carrier - a major problem as this kind of carrier cannot bring traffic into and out of its big hub in the way that the ME3 carriers can. QF was making such big losses that it had to make a lot of cutbacks and was forced to get into bed with EK and codeshare on EK flights out of DXB - indeed, QF's only European flights are to LHR.
It's not clear how SA is going to get out of the mess that it's in.
gunnerman wrote:As for LAN Chile: since the coming together in 2012 with TAM to form LATAM Airlines, the group has racked up repeated losses, so this doesn't look like a success story.
georgiaame wrote:Not that I'm any fan of any of ME3 airlines, nor am I biting on Delta's campaign of railing against massive government subsidies to them, but can someone please explain why government funding of SAA is perfectly acceptable, when funding of the Gulf airlines is a no no? Or does one need to be a lawyer to figure out why what is good for the goose is not good for the gander?
gunnerman wrote:DDR wrote:cathay747 wrote:Seems incredible that an airline like SAA can't be sustainably profitable. So sad. SA = AZ of Africa.
South Africa has the problem of being geographically located too far south to be a proper African hub.
SA is similar to QF, whose hub at SYD, in being an end-of-line and point-to-point carrier - a major problem as this kind of carrier cannot bring traffic into and out of its big hub in the way that the ME3 carriers can. QF was making such big losses that it had to make a lot of cutbacks and was forced to get into bed with EK and codeshare on EK flights out of DXB - indeed, QF's only European flights are to LHR.
It's not clear how SA is going to get out of the mess that it's in.
mercure1 wrote:With such massive losses, I wonder if they have any profitable route worth hanging on to?
behramjee wrote:Would SAA politically be allowed to shut down or are the South African unions too strong for the govt to handle?
georgiaame wrote:Not that I'm any fan of any of ME3 airlines, nor am I biting on Delta's campaign of railing against massive government subsidies to them, but can someone please explain why government funding of SAA is perfectly acceptable, when funding of the Gulf airlines is a no no? Or does one need to be a lawyer to figure out why what is good for the goose is not good for the gander?
Planeflyer wrote:How much pain will voters put up with b4 they vote out the ANC? Are we looking at another Venezuela type situation?
South African Airways (SAA) is effectively broke, Business Day reported on Thursday.
A cashflow analysis given to MPs on Wednesday in preparation for an SAA presentation to Parliament on Friday reportedly shows that the airline is effectively bankrupt.
SAA reportedly went into a negative cash position in July and further deterioration is expected in the months to come.
SAA needs a capital injection of R13 billion over three years to survive, Business Day reported. Worse, DA deputy finance spokesperson Alf Lees reportedly said that the cashflow projections did not include the R6.8billion in loans that SAA must pay to its lenders at the end of the month, that it was hoping to renegotiate.
KarelXWB wrote:Carrier needs a capital injection of $1 billion over three years to survive:South African Airways (SAA) is effectively broke, Business Day reported on Thursday.
A cashflow analysis given to MPs on Wednesday in preparation for an SAA presentation to Parliament on Friday reportedly shows that the airline is effectively bankrupt.
SAA reportedly went into a negative cash position in July and further deterioration is expected in the months to come.SAA needs a capital injection of R13 billion over three years to survive, Business Day reported. Worse, DA deputy finance spokesperson Alf Lees reportedly said that the cashflow projections did not include the R6.8billion in loans that SAA must pay to its lenders at the end of the month, that it was hoping to renegotiate.
Article
http://www.huffingtonpost.co.za/2017/08 ... _23062449/
SAA will tell Parliament on Friday that it has an "aggressive" five-year corporate plan, which has been refined with the help of aviation experts. Let's see if they can make a turn around.
77H wrote:I would imagine the SA government will provide the capital to stay afloat? If SAA were to go under that would leave South Africa without a long haul airline correct? Has a country similar in size to South Africa (population, GDP, etc) ever had their national and only long haul carrier collapse? I know Alitalia isn't doing well but it stands to reason that there are enough large carriers in Europe (with home based close by) would be able to pick up the slack if it were to go under. SA is so isolated geographically from any other countries with large carriers. ET is probably the closest?