SAA Pay Cuts

[fast&furious]

I dont't suppose any one has heard of a 20% pay cut!! It was mentioed to someone by JVJ. I would like to see how SAAPA will respond to that one!

[The Guvnor]

SAA's future is in doubt - see this article from today's SA Sunday Times:

SAA In Trouble (http://www.sundaytimes.co.za/2001/09/23/business/news/news01.asp)

It has of course been consistently losing money for many years - this may well be the final straw, especially with Swissair desperate to dump its holding.

http://www.sundaytimes.co.za/2001/09/23/business/news/1-saa23.jpg

[skyvan]

It's a pity that none of you were at Andre Viljoen's feedback meeting at Airways Park on Friday.
While SAA will be cutting costs, and improving efficiencies (and implementing it in places where it never was before), there is no talk of salary cuts. The ex-pat contractors, with Dollar based contracts will not be feeling too secure right now, and there is a hiring freeze being implemented.
SAAPA and SAA are starting salary negotiations in a couple of months, and we all know how fast things change in this industry, just look at the change in the last two weeks.
Either way, the company may battle to justify a pay cut, after AV's comments on the financial results, and the small matter of a 2 Billion Rand cash reserve. (A bit more that your airline's reserves, eh Guv? )

:rolleyes:

[The Guvnor]

Remember, R2bn is only $200m - rather less than the cost of two second hand 747-400s. And as I understand it, isn't that R2bn earmarked to replenish the money taken from the Transnet pension fund by SAA in the past for aircraft acquisitions?

Sounds a bit like typical SAA smoke and mirrors to me - but good luck to Andre and the team anyway!

[Skybiter]

Pay attention, folks. The Guv's speaking from a position of strength here. If anyone knows about smoke and mirrors, it's him....hehehehe.

Seriously though, hope it all works out and things not too dark in the days ahead. Good luck!

[fast&furious]

Was it not mentioned that the FDC would be targeted in the cost cutting and new "efficiences"? That 2bn fat should be used to pick up some bargains for the overseas fleet. It would be nice to own something again! Buy while everyone else is selling.

[skyvan]

Purely a thought, about the supposed FDC cost cutting. Due to the retirement bulge occurring over the next 4 or 5 years, that by itself will save some money, even if the same number of pilots are employed to replace the retirees.
Simply put, the difference in cost of a Senior Captain, level 25-30, and a brand new boy pilot, level -2, is quite steep. Even allowing for everybody getting older, and advancing a few levels, if there were to be no salary increases over the next three years, expected savings would most likely be in the region of ZAR50 million per year.
So, while the pressure will be on the pilots to accept a wage freeze, the main aim of the cost cutting is likely to be to trim the seniority list from the top, by arranging contracts, or possibly even offering a sweetener to retire a little earlier.

Just my 2c worth (That's SA cents, not US!!)