Streaming issues? Report here
Temp 702 logo 1000 x 1000 2020 Temp 702 logo 1000 x 1000 2020
Best of 702
00:00 - 04:00
volume_up
volume_mute

Up Next: Early Breakfast with Africa Melane
See full line-up
Best of 702
00:00 - 04:00
Home
arrow_forward
Business
fiber_manual_record
Politics

DPE appoints interim board for SAA but 'it's very thin on airline experience'

9 December 2020 7:12 PM
Tags:
SAA
The Money Show
Bruce Whitfield
Guy Leitch
IATA
SAA business rescue
DPE
SAA interim board

The move aims to restore 'proper oversight' during the business rescue process, but Guy Leitch says SAA's future remains bleak.

Remember SAA? It used to be an airline...

Bruce Whitfield, The Money Show host

As a number of other local airlines return to the skies, the grounded national carrier is still in the process of business rescue.

Now the Department of Public Enterprises (DPE) has appointed six non-executive directors to the interim board of South African Airways.

The appointees "will restore proper governance and oversight" during the implementation of a business rescue plan, says the DPE.

Their expertise ranges from legal skills and finance to aviation.

The interim board will be headed by Geoff Qhena, a chartered accountant and former CEO of the Industrial Development Corporation (IDC).

Also on Wednesday, consultancy McKinsey agreed to repay SAA and Transnet R650 million in fees for work undertaken with Regiments Capital (associated with the Gupta family) for the state-owned companies.

The news was contained in a statement by the State Capture Commission.

Bruce Whitfield gets input from Guy Leitch, managing editor of SA Flyer Magazine.

Leitch acknowledges that the interim board is a step forward in terms of the attempt to rebuild SAA.

However in the first place he says, the only planes the airline currently has are obsolete.

This board is very thin on airline experience.

Guy Leitch, Managing Editor - SA Flyer Magazine

Hopefully the R650 million will go into the kitty as well, but I remain deeply skeptical of any actual practical return to air from SAA for the foreseeable future...

Guy Leitch, Managing Editor - SA Flyer Magazine

... mostly because the airline hasn't got any aeroplanes! I've seen absolutely no sign of it making any attempt to get any aeroplanes [aside from the obsolete ones it hasn't been able to sell].

Guy Leitch, Managing Editor - SA Flyer Magazine

It would seem to me that the much-vaunted strategic equity partner we keep hearing about is actually not an equity partner at all but it's just going to be Ethiopian [Airlines] who are very happy to lend their aeroplanes and their crew and maintenance and everything to let SAA fly.

Guy Leitch, Managing Editor - SA Flyer Magazine

Leitch cites the report by the International Air Transport Association (IATA) which concludes that international airline traffic is not rebounding as hoped.

Domestically, SAA has also been out of the loop for too long.

The new normal is going to be really thin on business class travel... SAA's full service offering was more focused around this traveller than the low cost tourist operator.

Guy Leitch, Managing Editor - SA Flyer Magazine

There's no room left in the market for SAA to return domestically at all.

Guy Leitch, Managing Editor - SA Flyer Magazine

The original turnaround plan provided by the business rescue practitioners assumed a R10.5 billion just to keep it going, but honestly my view at this stage is that it's going to cost R40 billion and upwards for the airline to even begin to get back to sustainable ground.

Guy Leitch, Managing Editor - SA Flyer Magazine

Listen to the complete interview on The Money Show:




9 December 2020 7:12 PM
Tags:
SAA
The Money Show
Bruce Whitfield
Guy Leitch
IATA
SAA business rescue
DPE
SAA interim board

More from Business

More from Politics