This is going to put a damper in African travel.

April 18, 2020: Approximately a year ago at the Air Cargo Africa 2019 in Johannesburg, South African Airways' (SAA) Group CEO Vuyani Jarana (who ended his term on July 31, 2019), shared different contours of the work in progress for saving the terminally ill company to Logistics Update Africa. But the lack of commitment to fund SAA by the government systematically undermined the implementation of the strategy, making it increasingly difficult to succeed.

Now, SAA is planning to lay off its entire 4,700 employees, compelling to ground the 86-year-old national carrier. The state-owned airline has offered compensation deals to all staff from the end of April after administrators - Les Matuson and Sizwe Dongwana concluded that a successful turnaround is now unlikely, according to a proposal to eight labour groups seen by Bloomberg News. The basic value of compensation will be one-month pay per year of service and will depend on the successful disposal of assets such as real estate, rotables, and trade debts.

On March 26, acting CEO Zuks Ramasia has resigned from SAA, opting for early retirement by serving till April 14, 2020.

In December last year, South African government decided to place SAA under a local form of bankruptcy protection as a last measure to prevent its total collapse. SAA has received another extension from lenders and creditors to publish their long-awaited rescue report, which was to be published on May 29, 2020.

Public enterprises minister Pravin Gordhan said earlier this week that the cost of staving off the Covid-19 pandemic in the country meant no more cash could be extended, while finance minister Tito Mboweni said the carrier's closure could help shore up state finances. The administrators will now look to sell assets and raise cash to repay creditors.

In the 2020-21 budget, Mboweni allocated a total of ZAR16.4 billion ($1.06 billion) to allow SAA to repay guaranteed debt and interest costs. This year alone, ZAR10.3 billion ($660 million) has been set aside for SAA while ZAR4.3 billion ($270 million) and ZAR1.8 billion ($110 million) had been budgeted for 2021 and 2022, respectively. Since 2008/09, the flag carrier has incurred net losses of over ZAR32 billion ($2.04 billion). As such, the government anticipates that additional funding will be required to cover restructuring costs in line with the business rescue plan, once it is unveiled.

The airline has not released its financial statements for the past two years in the fear of liquidation.

Recently, SAA has been flying cargo planes and chartered flights to countries such as Germany and Brazil in recent weeks, but no commercial passenger services.

SAA is among several South African state-owned companies to have become technically insolvent without financial assistance from the government, following years of mismanagement and corruption scandals -- particularly under the presidency of Jacob Zuma, which ended in 2018.

The airline has seen at least nine chief executive officer changes in the past decade, hampering attempts at a turnaround, while responsibility for the carrier was passed from the Department of public enterprises to the national treasury and back again.

Another airline to follow the path of SAA is SA Express, which has been served with an urgent court application to be placed under business rescue.

Since the outbreak of coronavirus in China, African Airlines have lost $400 million (312 million), according to the International Air Transport Association (IATA).

quote:

SAA is among several South African state-owned companies to have become technically insolvent without financial assistance from the government, following years of mismanagement and corruption scandals -- particularly under the presidency of Jacob Zuma, which ended in 2018.

Ah, doesn't it all sound so familiar? Just another in a long line of same old same old.

Crap. There goes all the hunts that were going through J'burg. If someone does not fill in with travel to other African countries from RSA, it is going to cause issues.

This is not a final decision yet.

Has anybody had experience with SAA and getting a refund? I don't go until Sept. and I'm still hoping but in a couple of months I'll have to make a decision.

I would be busy booking on another airline.

In regards to your refund, I would get busy on that too. If there is any money left after all the golden parachutes, bonuses, and windfalls, they may have enough for refunds. But as the government is no longer backing them, refund chances are fleeting.

The fate of many government run businesses.
They are set up or taken over for the good of the country, but often fail.
Such businesses should be established by private enterprise and run to make a profit and allowed to shut down if they fail. Some call this method Capitalism; others call it common sense.

South African Airways To Lay Off 4,700 Workers, Risks Collapse

MIAMI – South African Airways (SAA) is set to lay off its entire 4,700-strong workforce after failing to convince the government to provide more financial help, risking the collapse of the 86-year-old national airline.

According to a proposal to eight labor groups, SAA has offered a severance package to all staff starting in May after administrators concluded that a successful turnaround is now unlikely.

The compensation includes one-month pay per year of service and will depend on the successful disposal of assets such as real estate, according to the document from a report by News24.com.

The South African carrier has not made any profit since 2011, having relied on bailouts and state-guaranteed debt agreements and bankruptcy protection for years. So far, SAA has been flying cargo planes and chartered flights in recent weeks, but no commercial passenger services.

But COVID-19’s unexpected fallout entails SAA’s demise, as the company was already cutting routes and planning job cuts before the outbreak happened.

According to Gulf News, Public Enterprises Minister Pravin Gordhan said that the cost of fighting off the COVID-19 pandemic translated to zero cash for any form of bailout. Even worse for SAA, Finance Minister Tito Mboweni said the airline’s demise might help strengthen state finances.

Selling assets to gain cash According to Bloomberg, SAA administration chiefs Les Matuson and Sizwe Dongwana plan to sell assets to repay creditors. In addition, according to industry insiders, two highly valued nighttime operating slots at London Heathrow could be up for grabs.

After having seen nine CEOs pass by its ranks in the last ten years and aloof back-and-forth oversite by the Department of Public Enterprises and the National Treasury, SAA, a state-owned company, has become, like many other state companies, technically insolvent without state support.

Moreover, the company has been riddled with mismanagement and corruption scandals over the years, most notably under the presidency of Jacob Zuma, which ended just 2 years ago.

What is about to happen to SAA is nothing short of a warning to financially weak carriers grappling with the ongoing fallout of the COVID-19 pandemic, especially those that are doing so without any form of government assistance.

National airline of a busy country like South Africa should never fail.

It should be in profit.

But, South Africa has gone down the drain since all the management was changed for political reasons, not business sense.

The South African government is hopefully running out of people to blame

One would be surprised by how creative they can be.

One thing that Africa will never run out of and that's excuses.

quote:

Originally posted by Bama15:
Has anybody had experience with SAA and getting a refund? I don't go until Sept. and I'm still hoping but in a couple of months I'll have to make a decision.

Bama15 with all the issues that South African Airways has been having the past few years and just in the last 8 month. I am at a loss why you would schedule your travels on their airline, not knowing if SSA would be in operation the next day or month.

Others on here have been searching/looking for ways to arrive at their destinations using other airlines.

quote:

National airline of a busy country like South Africa should never fail.

It should be in profit.

But, South Africa has gone down the drain since all the management was changed for political reasons, not business sense.

Exactly!
And for those who have paid for tickets, you might consider yourself an unsecured creditor, not likely to get a refund! You can only hope. . . .but not in Africa.

Another example of the failure of BEE. In this case it stands for black engineered embezzlement.

When discussing SAA, there are a number of factors to consider:
1) SAA is owned by the government of RSA;
2) The government of RSA are Communists and don’t understand the concept of turning a profit;
3) The RSA government are corrupt;
4) The RSA government are incompetent;
5) The RSA government are racist (anti-white)

Since the vast majority of companies that are owed money by SAA are white owned, it’s the perfect opportunity to stick it the scapegoat whites, rather than accept full responsibility for failure due to corruption, incompetence and outright thievery.

quote:

Originally posted by Use Enough Gun:
...
And for those who have paid for tickets, you might consider yourself an unsecured creditor, not likely to get a refund! You can only hope. . . .but not in Africa.

I had a thought and called Chase as I have their "Chase Preferred" credit card. I am covered if SAA will not issue a refund as I have both purchase protection and travel insurance as part of the card benefits. They will even issue me a refund and deal with SAA (or not) themselves so I do not have to show proof that SAA is not refunding etc..

Regardless, still need a flight from J'Burg to Harare that will take firearms.

Black political parasites never seemed to learn the most important lesson from white political parasites: Never suck so much blood that you kill the host.

quote:

I had a thought and called Chase as I have their "Chase Preferred" credit card. I am covered if SAA will not issue a refund as I have both purchase protection and travel insurance as part of the card benefits. They will even issue me a refund and deal with SAA (or not) themselves so I do not have to show proof that SAA is not refunding etc..

Glad to hear that. Not everyone may be as lucky as you are with your credit card benefits.

quote:

Originally posted by Use Enough Gun:
...

Glad to hear that. Not everyone may be as lucky as you are with your credit card benefits.

People should check though. When I had signed up for that card it was due to travel points benefits and I got a booklet (which I never read) for all other the stuff it provided. So, it is good to check.

Actually, anything you buy with a credit card is insured, as long as the price exceeds $100 I think.

If the bank refuse a refund, go somewhere else!

My bank has always said any charge on my card which I am not sure of, should be flagged and I do not pay it!!

Boy I’m sure glad I did that double trip last fall and this year I planned but didn’t buy anything...lucky me
That being said, once it blows over I’m heading out there Hell or high water

Eskom next ..

.

Staying on airlines ..... Lufthansa is close to tits up and Virgin is cap in hand to the UK government, although Branson has not paid taxes in the UK for close to 20 years!

SAA is piss poor management and corruption plus C19 whilst many of the others are victims of Corona.

See which one falls out of the skies first and fastest!


.

I am laughing my head off at that idiot Branson!

He wants the UK to bail one of his airlines, having made sure he lived outside their tax requirements!

He is doing the same in Australia, while most the owners are foreigners!

Got to hand it to him.

He was fine when he had a music record shop.

Everything else he got involved has gone tits up!

.

Saeed,

Interesting thing on Branson was that in his very early days in the record business he was actually prosecuted for VAT evasion and found guilty! He was exporting records from UK to France on the ferry in a van and claiming UK VAT back and then bringing them back to the UK on the same day!

Somehow Buckingham Palace overlooked his tax fraud when their knighted him!

Whats the saying "once a thief ...."

Happy days

.

I was reading that travel for domestic air travel in the USA will not pick up until major family destinations open up to the public. Like Las Vegas, Disney Land & World, the travel industry is seeing that families will be driving to closer point for future vacations, skipping air travel and car rentals.

International travel will start only after the domestic traffic picks up. The presidents of the various airlines do not have a firm date on when international travel will begin, however it is not anytime soon for Africa. Projected out 2 to 3 years. This is for the USA based airlines.

Ethiopian Airlines is the largest airline in Africa and it will be in need of a government loan or bailout, it appears to be an airline to consider for future travels, if they are still in operation.

Not all the airlines will be in operation next year, some will go by the way side and travelers will be paying more to travel. Anywhere from 10% to 50% is the anticipated pricing increases.

quote:

Originally posted by Bwana338:
...
International travel will start only after the domestic traffic picks up. The presidents of the various airlines do not have a firm date on when international travel will begin, however it is not anytime soon for Africa. Projected out 2 to 3 years. This is for the USA based airlines.
...

2-3 years might be a tad long. However, I can see them cutting down on routes. Turkish airlines announced being grounded until end of May and I think Emirates is the same.

I am hoping for international airlines to get going in July. Airlines like THY and Emirates base almost all of their revenue on international flights.

Emirates not flying before July.

Not many countries are accepting visitors until further notice.

So nothing we say here has any meaning.

I see one cheap airline is starting flights from the UK to Spain and Portugal.

Not sure how they are going to do it, because neither country is accepting any visitors.

I did read somewhere Greece is expecting to welcome visitors beginning July - but 30%+ of their GDP is tourism so the imperative is huge.

Wizz Air appears (currently) to be planning to go from Luton to Lisbon and the Canaries (among others) but not mainland Spain.

I wonder if they are talking about SAA:

https://af.reuters.com/article.../idAFKBN22C2HY-OZABS

Hahahaha!

“Poorly functioning” companies?

Poorly run country, with endless corruption, that is what need to be addressed!

South Africa was one of the strongest economies in Africa.

Not any more!

Without intervention from either the government or a private buyer willing to keep the airline going, South African Airways is likely to disappear from the skies for good.

There is a glimmer of hope for South African. Governments don't typically let their airlines vanish completely, the most recent example being Alitalia. The iconic Italian airline was faced with a similarly uncertain future following a failed sale. Despite vows to the contrary, the government stepped in and re-nationalized the airline.

South African Airways' disappearance would not only cost South African jobs but would make the country largely dependent on foreign carriers for international flights beyond the sub-Saharan region. Nearly 5,000 jobs are on the line as the airline teeters on the brink, according to Bloomberg.

The South African government, however, has been in talks with union leaders to create a new airline from the ashes of South African Airways, Reuters reported. Reports by Bloomberg indicate that the enterprise would ideally be both privately and publicly owned.

"The old SAA is dead, there is no doubt about that," Minister of Public Enterprises Pravin Gordhan told Bloomberg. "But what will take its place may be some or all of the old SAA and maybe some other airlines too."

A deadline to cement the final decision on South African's future is set to expire on May 8, according to the outlet.

quote:

Originally posted by Bwana338:
...

A deadline to cement the final decision on South African's future is set to expire on May 8, according to the outlet.

I sure would like to know for sure so I can proceed with a refund or not.

quote:

Originally posted by tanks:

quote:

Originally posted by Bwana338:
...

A deadline to cement the final decision on South African's future is set to expire on May 8, according to the outlet.

I sure would like to know for sure so I can proceed with a refund or not.

If you have bought your tickets with a credit card, you might be covered.

You should chase them.

quote:

Originally posted by Saeed:
...
If you have bought your tickets with a credit card, you might be covered.

You should chase them.

Oh, I am covered I know that. However, at this time as far as anyone knows the flights in July are still a go.

As a matter of fact going to their site I could book the same flights I had booked earlier if I wanted. It came up as seats being available.

quote:

Originally posted by tanks:

quote:

Originally posted by Saeed:
...
If you have bought your tickets with a credit card, you might be covered.

You should chase them.

Oh, I am covered I know that. However, at this time as far as anyone knows the flights in July are still a go.

As a matter of fact going to their site I could book the same flights I had booked earlier if I wanted. It came up as seats being available.

I see some airlines are promising flights in July, others are promising flights later on in the months.

Some actually have said no flights before October!!

We are booked late September, and I hope things will open up by then.

Personally, I think SAA is dead and if the countries open up I will take have to take Emirates assuming they are flying to Harare at the end of July.

Which sucks as I was looking forward to staying at the Elephant camp for a few days at Victoria Falls with the girlfriend after my hunt. That part of the trip will have to be canceled as without SAA neither of us can get to Victoria Falls.

quote:

Originally posted by tanks:
Personally, I think SAA is dead and if the countries open up I will take have to take Emirates assuming they are flying to Harare at the end of July.

Which sucks as I was looking forward to staying at the Elephant camp for a few days at Victoria Falls with the girlfriend after my hunt. That part of the trip will have to be canceled as without SAA neither of us can get to Victoria Falls.

Latest news is that a new state airline will take over from SAA. The way I understand is, is that SAA will be liquidated, and replaced with a new state airline. I guess this, in their own mind, cleans the slate "getting rid" of debt, and starting a fresh. I presume, the new airline will take over the assets and majority of the employees. I flew to Dallas via JFK this year, and flew in one of their new panes. Plane was awesome, service really good.
I think it would be a real shame losing them. They cover a niche in the market.

I would not hold my breath on this.

They took an airline and ruined it.

They are declaring it bankrupt so creditors don’t get paid.

They will a brand new one, and do exactly the same again!

After the management lines up their pockets!

As long as BEE and not skill and experience is the guiding principle, ANY effort is doomed going forward- and BEE is not going away...