List one underhanded practice that SAA used to crowd out it's competitors
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Airlines are being hit hard by the coronavirus crisis. In intensive care for several years, the former South African flagship should be liquidated in a few days. Several private operators such as Comair, FlySafair and Airlink are jostling to take over its few profitable activities.
South African Airways (SAA, 6.8m passengers in 2017) could well be the first major victim of the coronavirus crisis threatening the entire airline sector by the end of April. Potentially the first in a long series…
Placed in December under safeguard proceedings by the government, the company, indebted to the tune of 9.2bn rand, or 570m euros, and regularly bailed out (20 billion rand injected over the last three years), seemed to have some respite.
READ MORE Inside the SAA crisis: airline needs more than R2bn to stay afloat
But the government’s decision in mid-April not to offer another 10bn rand extension sounded the alarm for this elderly company, born in 1934, which is both the pride of the Rainbow Nation and a model for the continent.
Assets to be sold to finance a redundancy plan
“It would have taken a lot of money to get it back on its feet. And, if before Covid, we could count on a measurable flow of traffic, that’s no longer the case today. We don’t know how quickly business will pick up again, or even if it will return to pre-crisis levels. The company was already struggling before the pandemic. How could it do better afterwards? ” says former deputy managing director, Sylvain Bosc, who is advising several African countries on how to revive their airlines.
READ MORE South African Airways is in business rescue: what comes next?
Although the government made a commitment to the unions on 21 April to relaunch a new “viable and competitive” national carrier, Pretoria will have other priorities on its agenda in the coming weeks.