South African Airways in Trouble ?

[bafanguy]

This sounds dire. Accurate ?:


"Africa’s second largest airline and one of its most historic is in danger of liquidation…"


https://airwaysmag.com/airlines/south-african-airways-brink/

[amfar]

SAA is badly run, overstaffed and a liability to all us poor bastards as taxpayers - plain and simply put. In fairness to SAA's competitors it should be liquidated or sold. If it is sold, the question then is who would buy a company that is so overstaffed (with many of them obviously incompetent with the job in hand) and would the unions/government allow retrenchments? That leaves us with "dump it".

[ExDubai]

I would remove the question mark. Yes they are in trouble, as long as the politicians use SAA as a "self service shop", nothing will change.

[bafanguy]

Well, I sure hope this doesn't turn out as predicted.

[GordonR_Cape]

You could write a whole book about the mis-management of SAA, which has been ongoing for years. The need for repeated bailouts by the taxpayer have not helped stabilise the situation, and political interference in the running of the state-owned entity has made things worse. For the latest saga see: Zuma/Gordhan rift over SAA is false - Presidency | Fin24 (http://www.fin24.com/Companies/Industrial/zumagordhan-rift-over-saa-is-false-presidency-20160822)

Some critical aspects have now come to a head, and while the risks of liquidation are real, such an outcome would be unrealistic, since the airline is too-big-to-fail. Expect some sort of compromise, which will postpone the immediate crisis, but with no long term solution in sight.

BTW, the photo at the top of the article inadvertently highlights one of the most obvious problems faced by SAA, its ownership of A340 four-engine jets, which are no longer fuel efficient, and have plummeted in resale value.

[ExDubai]

I thought Dudu is the most obvious problem ;)

Sure, quads are a problem. But with todays fuelprize SAA should be able to use them and gain some profit.

[bafanguy]

How many pilots are at risk here ?

[CSman]

IF this is true it would make me very sad The SAA engineers were the best at any down route station Terry Morgan BA 747[ long since retired]

[The Ancient Geek]

Privatisation is the only sane solution.
Declare insolvency to allow IAG or similar to step in without all of the dead wood and politically appointed incompetants.
The A340s are not the problem, just a smokescreen to cover up the overstaffing and the enormous wage bill.

Just let Willie Walsh sort it out in the same way that he sorted Iberia.
Sort out the abysmal cabin service and the passengers should come back.

[4runner]

IF this is true it would make me very sad The SAA engineers were the best at any down route station Terry Morgan BA 747[ long since retired]

A BIGGGGGG roger on that Skipper! SA engineers are nothing short of spectacular. They're pretty good around a bbq(brai) too. Don't fret too much about the boys though. Their virtues are well known globally and they're aggressively head hunted by operators who pay much better than SAA.

[GordonR_Cape]

The stakes are getting higher: SAA looking for R16 billion to keep flying (http://businesstech.co.za/news/business/134791/saa-looking-for-r16-billion-to-keep-flying/)

Privatisation would be the rational solution, but this is Africa....

[TopBunk]

Why on earth would IAG/Willie Walsh want to invest in SAA?

As has been said, they are a basket case and BA/IAG can clean up on the JNB and CPT routes with little competition from SAA and use franchisee Comair to transfer pax to / from LHR / local cities.

What else have SAA got to offer over the above?

Not a lot, I would suggest.

Even if they did invest they would have to contend with SA politics and politicians with their way of doing business.

If I were Willie, I wouldn't touch them with a barge pole!

[The Ancient Geek]

The whole point of privatisation is to get rid of the politicians and their expensive unproductive dead wood.
Run as a proper fully independant business with good professional management it could be a good profitatable airline. There would naturally be howls of protest from the unions but the choice is simple - privatisation with job cuts or insolvency with no jobs.

[TwinJock]

SAA is in very deep Dudu.......:rolleyes:

[GordonR_Cape]

The bailouts will continue: Myeni set to win SAA battle and remain board chair - report | Fin24 (http://www.fin24.com/Companies/Industrial/myeni-set-to-win-saa-battle-and-remain-board-chair-report-20160901) and SAA gets breather on Hong Kong deregistration | Fin24 (http://www.fin24.com/Companies/Industrial/saa-gets-breather-on-hong-kong-deregistration-20160831)

[Juliet Sierra Papa]

SAA is in very deep Dudu.......


TwinJock :D:D:D

[ian16th]

BREAKING: Dudu Myeni survives another day at SAA | Fin24 (http://www.fin24.com/Companies/Industrial/breaking-dudu-myeni-survives-another-day-at-saa-20160902)

[Cardinal Puff]

The game of musical troughs continues. Still a few comrades who need to be rotated through a couple of directorial and managerial positions to get a good suck at the trough, so the edifice will continue being propped up by public money until all have had their turn at the gravy or it goes tits up regardless.

The sense of entitlement to public funds for personal ends by the regime is absolutely mind boggling.

[ExDubai]

My deep and sincere apologies to Dudu Myeni. Now we know what's the proplem. The gredy pilots...... Pampered SAA pilots? bizarre perks and wages cost R2bn | The Citizen (http://www.citizen.co.za/1294377/pampered-saa-pilots-bizarre-perks-and-salaries-cost-r2bn/)

[VHFRT]

"Glorified drivers"... wow, I thought the Australian media was bad! As someone from outside ZA, I'm assuming this particular "news" agency is simply pushing an agenda? (I note several "white" comments)

[GordonR_Cape]

There are a few reputable news media outlets in ZA, but the Citizen ranks pretty low on that scale IMO. The article seems to be a mish-mash of slander and inuendo (not reported in any other media), and completely misses the point about the running of SAA...

There was a satirical cartoon in last week's Mail & Guardian weekly newspaper (I am unable to find a link online). It showed Dudu Myeni going undercover as a cabin attendant on an SAA plane, to better understand how an airline actually works (and failing significantly). After various faux-pas, she proceeeds to blame everything on her predecessors (or apartheid!) She then takes over as captain, and makes a cabin announcement, upon which all the passengers are shown screaming and running for the exits. A profound metaphor IMO...

[cavortingcheetah]

Indeed, the Citizen was started in 1976 and was for many years an unreconstructed government mouthpiece. But notwithstanding the political and racial over and under tones of the article in question, isn't the Citizen article pretty accurate in its statements relating to the terms and conditions and perks and privileges for flight deck crews and their playmates?
Isn't it actually true that SAA pilots have a splendid long term negotiated contract that is the envy of pilots in other international airlines.
http://www.citizen.co.za/1294377/pampered-saa-pilots-bizarre-perks-and-salaries-cost-r2bn/

[Metro man]

The finger seems to be pointed at the Pilots terms and conditions as the sole cause of the airlines current financial state. Whilst very generous they are only a small factor in the current mess and a deeper more thorough examination of the airline needs to be undertaken. Obviously this won't be done in order to protect highly placed vested interests.

Longer than normal sick leave is normal for flight crew as a higher standard of health is required when on duty than compared to an office job where you can simply go home if you feel unwell. Likewise longer maternity leave would be normal especially if pregnancy suspends the Pilots medical for the full term.

Separate hotels for flight and cabin crew are also provided in some other airlines such as SQ. However the cabin crew deserve better than 2*.

With the majority of the Pilots being white male, they are an easy target, however the non white first officers coming through are looking forward to the day when they move into the left hand seat and expect to enjoy the same benefits as the current Captains.

Note that two white Pilots were shown in the article as it was adverse to SAA, had it been favourable the demographic shown would have been different.

[deeceethree]

The whole point of privatisation is to get rid of the politicians and their expensive unproductive dead wood.
Run as a proper fully independant business with good professional management it could be a good profitatable airline.
That doesn't work in Africa! You would still have to grease the palms of the buffoons in positions of power in the regulatory bodies e.g. to obtain operating licences, permissions etc. Those idiots are incapable of keeping their hands out of the cookie jar.

When they see any enterprise making money, they come along and insist on under-the-table payments just to let you continue largely 'unmolested'. If you don't agree to that they undermine your business by foul means, until you give up in disgust. Then they take over said business, appoint their family and friends to run it and screw it up anyway ..... because they can't keep their hands out of the cookie jar. A never-ending cycle of nepotism, corruption and incompetence. No private individual or enterprise in their right mind would touch SAA. Ever! TIA!

[PAXboy]

deeceethree Marks all the points. One of the key reasons that SAA flight crew enjoy a high level of benefits is because the airline has yet to face the realities of life - as experienced throughout Europe, North America, Antipodes and Japan, across the last 30 years.

It is with zero pleasure that I say, Their time will come.

[GordonR_Cape]

The first hint of a rational policy towards stopping the rot: https://www.bbc.com/news/world-africa-46070949

South Africa's state-owned airline should be shut down, the country's new finance minister has said.

"It's loss-making, we are unlikely to sort out the situation, so my view would be close it down," Tito Mboweni told an investor conference in the US.

[krismiler]

SAA is the African version of Air India, a massive bloated bureaucracy which the government would love to get rid of but can’t because of all the snouts in the trough. The high ups who benefit from overpriced contracts with the airline or who have relatives in important positions will ensure a tax payer funded bail out for yet another final time.

Even Etiha_d would touch them with a barge pole if they had the money.

[Chuck Notyeager]

IF this is true it would make me very sad The SAA engineers were the best at any down route station Terry Morgan BA 747[ long since retired]

In their esteemed wisdom the cANCer and their BBBEE (Broad Based Black Economic Empowerment) policy chased away 185 (European) highly qualified maintenance engineers, licensed to sign out Boeings and the Airbus variants, just because they did not fit into the big plan.

Today SAAT (SAA Technical) can not service their own aircraft due to skills shortages. As a result SAA, Mango and Comair now have their aircraft serviced in the ME or Europe.

[Raffles S.A.]

It sure should be shut down. But I doubt if it will happen. Too much of a milking cow for the cANCer. Feed the cow with taxpayer money and take the milk.

[PAXboy]

ZA, like the majority of countries before them (not just in Africa) consider having 'their own' carrier as a mark of prestige and a 'place marker' in the world. It is not just the snouts in the trough - they think that having 'their' airline branding makes them bigger on the world stage. As Europe, the Antipodes and the USA have discovered, this is no longer the case.

Once upon a time you had to have your shipping line, then you had to have your airline. Now? In due course, ZA will follow the rest of Africa in realising that they cannot fund an airline of the 1970s and 80s any longer. However, if they want to prolong SAA for a bit longer, they can ask Alitalia how they have pulled it off .... :hmm:

[GordonR_Cape]

Long-delayed developments starting to unfold. Links in the News forum: https://www.pprune.org/rumours-news/627643-south-african-airways-going-under.html