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Why did Treasury bail out Mango Airline? - Expert

5 May 2021 5:34 PM
Tags:
National Treasury
South African Airways SAA

SA Flyer Magazine publisher Guy Leitch says SAA Technical has a complex problem that involves scarce skills worth being held down.

South African Airways (SAA) subsidiaries have been given a lifeline after the National Treasury announced yesterday that it would allocate them R2.7 billion in funding.

This will bring relief to SAA’s subsidiary, Mango Airline, which was contemplating placing itself under business rescue this month following a severe cash crunch at the low-cost carrier.

Managing editor at SA Flyer Magazine publisher Guy Leitch argues that there is very little justification as to why Mango airlines had to be bailed out, unlike SAA Technical, which has a complex problem that involves scarce skills worth being held down.

The sad reality is this is not a double down by the government, it’s a tenfold double down because we have had this gusty step change from the complete disruption of the world travel industry and people are still not traveling over a year down line.

Guy Leitch, Managing Editor - SA Flyer Magazine

The government has had to make a decision to either continue with the airline or not and it has decided to rightly or wrongly continue with the airline.

Guy Leitch, Managing Editor - SA Flyer Magazine

I think the real question is what is the real role of Mango via SAA because as you may recall, SAA had decided to not offer a detailed domestic offering but limit full-service offering and that is why it requires Mango. That is why the government continues to tenfold double down to keep Mango alive.

Guy Leitch, Managing Editor - SA Flyer Magazine

RELATED: Mango to fly again on Thursday after making part payment of fees owed to Acsa

Leitch says SAA Technical will not be able to compete against anyone else until tourism or travelling is back to its normal state.

Listen to the full interview below...




5 May 2021 5:34 PM
Tags:
National Treasury
South African Airways SAA

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