What's up at SAA ??

[skychick2]

Heard via the grapevine today that Khaya was going to make an announcement today re the "way forward''(what a nice way to put it) re SAA restructuring. Anyone got any info on this??

[skychick2]

Clearly no one got any information on what is going to happen at SAA, or maybe that's exactly whats happening...........NOTHING !!!

[Deskjocky]

lots is happening. Board signed off on the plan on the 2nd, now its off to DPE followed by presentations to a number of other government departments as well as the parliamentary portfolio committee once everyone is in agreement then it goes to the cabinet for the final rubber stamp. This should all be done by the end of June. In the meantime measures that fall within the CEO’s delegation of Authority will be actioned immediately these include retrenching up to 50% of management, closing certain offices etc.

[swingwing 11]

SAA problem is the glut of managers and instead of getting rid of most and holding the rest accountable for their actions THE SHACK has just mployed 2 more a chris smythe and clive smythe so the circus continues.:ugh:

[Frogman1484]

I Thought they got rid of all of the extra managers a few years back?

:confused:

[MBDriver]

Chris Smythe is one of the most intellegent people I have ever met. He was Finance Director of NAC, Kenya Airways and Virgin Nigeria. If he can keep up his past record, he will deffinately be an asset in what seems to be a desert of competence at SAA.

[surely not]

I'll second those complimentary comments by MBDriver about Chris Smythe. He kept close control of the finances at VK without restricting the managers who had genuine and justifiable needs for expenditure.

If there is wastage at SAA it is about to stop.

[bianchi]

Well ???If that is accurate,then it is "good news"for SAA !!

[abujaflyer]

Chris is a very good operator. For all pilots he has his PPL at least and may have his CPL. He will be sorely missed at VK which will be a much poorer place without him. He will make an impact at SAA, just be careful of his sense of humour! Good luck to him.

[MBDriver]

Chris had a CPL I dont know if it is still valid, but it was. Never mind the sense of humour, just watch out if you are in front of him and there are steps. He tends to fall over everything.

[Deskjocky]

Interesting that Khaya has chosen to bring Chris in, GM flight ops now reports to him and not the CEO anymore. I get the feeling this has something to do with the incumbent not playing ball on the cost side and so he has effectively been sidelined. Same situation with airport operations. Interesting times. One hopes that Chris will be able to manage the political firestrom he has chosen to walk into....:confused:

[FUG]

"A Modern Parable" from The Business Day 25 April 2007
A Japanese company (Toyota) and a South African company (South African
Airways) decided to have a canoe race on the Vaal River. Both teams
practised long and hard to reach their peak performance before the race.
On the big day, the Japanese won by a mile. The SAA team, very
discouraged and depressed, decided to investigate the reason for the
crushing defeat. A team of senior managers was formed to investigate and
recommend appropriate action. The conclusion was that the Japanese had
eight people rowing and one steering, while the SAA team had eight
people steering and one rowing.
Feeling a deeper study was in order, SAA management hired a consulting
company and paid it a large amount of money for a second opinion. The
consulting company advised, of course, that too many people were
steering the boat, while not enough were rowing.
Not sure of how to utilise that information, but wanting to prevent
another loss to the Japanese, the SAA team totally re-organised the
rowing team's management structure to include four steering supervisors,
three area steering superintendents and one assistant superintendent
steering manager. It also implemented a new performance system that
would give the one person rowing the boat greater incentive to work
harder. It was called The "Rowing Team Quality First Programme," with
dinners and free pens for the rower. There was a lot of discussion about
getting new paddles, canoes and other equipment, as well as extra
holidays for practices and bonuses.
The next year the Japanese won by two miles.
Humiliated, SAA management laid off the rower for poor performance,
halted development of a new canoe, sold the paddles and cancelled all
capital investments for new equipment. The money saved was distributed
to executives as bonuses and the team outsourced to India

[Deskjocky]

Love it!! sent it to my boss:}

[George Tower]

Deskjockey

What's with the story that SAA are reportedly scrapping LHR-JNB:confused:

My initial reaction is pretty much the same as John McEnroe's famous outburst at Wimbledon.

[Deskjocky]

Dont know where that has come from and its certainly not true. What may happen is that a few flights will get cancelled during the phasing out of the 744 but that will be about it. The only termination that is being considered at this point is the LHR CPT service- but even then what we are looking into to is that the flight will operate out of JNB which will give us triple daily service on the route out of JNB.

[Capetonian]

I can't see SAA phasing out LHR-JNB as it is obviously a flagship route, but I did hear from an internal source that it is a loss maker. I assume that this is based on the total cost of the operation at LHR and the office in Regent Street (or wherever it is in Central London?), but even so, they must have their revenue management seriously wrong if they consistently lose money on a route that has such a high load factor, and where the front of the aircraft often sells out before the back. Either that or too many of Khaya's buddies are travelling on freebies!

[ByAirMail]

The opposition will jump to take these slots from S.A.A. (JNB or Cape Town) If you cannot make money on the route that makes POUNDS then you have serious problems. But then this is a rumor network, will be very disappointed (worried if it worked for them) if this is true.

[point8four]

Capetonian-
High load factor is not neccessarily an indication of route profitability. I would hazard a guess that yield or revenue per seat nautical mile would be the benchmark for a route going into red or staying black. (Excuse my political incorrectness - making money or losing money)

Be that as it may- I cannot see SAA dropping the LHR - not in a million years.

[Capetonian]

High load factor is not neccessarily an indication of route profitability.
I'm very aware of that. You could fill every seat every flight if it was cheap enough and still lose money. If it's true that the route is losing money then they have their yield management wrong, or their costs are too high, or they have revenue leaks, or there are too many freebies .... or a combination of all that.

[George Tower]

I'm wondering if the article in question was a misprint - omitted the "East" in East London???

Be suprised to see them pulling off either CPT or JNB from LHR as these are flagship routes.

[Capetonian]

Battling SAA may scrap Joburg-London flights
By TOM MAPHAM
IN A drastic cost-cutting exercise South African Airways may scrap several of its international flight services, including the Johannesburg-London route.
The cost-saving measures are part of a turnaround plan aimed to save the company that recorded a R650 million loss last year, its chief executive, Khaya Ngqula, said in an address in East London last night.
Addressing the Institute of International Affairs, Ngqula said the London-Johannesburg route could be one of the first expenses to go. Flying the route cost the national carrier R500m a year, he said.
http://www.dispatch.co.za/2007/05/08...ca/aalead.html
I think they mean London as in LHR, not as in ELS!

[madherb]

So - is KN actually saying that of the R650m loss, R500m is attributable to the Joburg-London route alone? That does not sound right. I know the 747s use a lot more fuel to London, but they do carry more pax. Maybe the yields are bad due to competition...........that's life, live with it or fix it.

[Frogman1484]

If they cannot make money on the LHR run...then they are a basket case and need to shoot someone. You cannot get a seat out of london...ever!!!

[dikkes]

Deskjockey, as this affect me directly, what have you heard about CPT becoming a domestic station only? All International flights to be routed from JNB only.
Regarding this cutting of LHR flights, is this not just temporary while the B744 are put out to pasture and the Airbus fleet (ex India) comes on line?
The Jumbo pilots have to do conversions etc. and this will slow up the process. Have also heard that PAR is next to close.
:confused: :confused: :eek:

[ERASER]

Sadly everything is still just rumours and speculation..........closing the LHR route will be the beginning of the end.

40% - 50% management will go in the next 6 weeks, then the turn of the junior staff.

The B744 will be withdrawn over a 9 month period, 1 wfu (SAX) 5 to go.

1st A343e back from Jet Airways, other 2 will arrive within a months time. (1st A343 going for a c check shortly).

SAA is closely looking at the B787?????

Rough times ahead for the SAA staff!!!

[Deskjocky]

Dikkes,

CPT may well become all domestic over time. Its looking like a better option to route all the capacity over JNB and feed to CPT via the scheduled domestic flights. Unfortunately the yield per set is better ex JNB than ex CPT in both cabins. Right now money talks and that’s bad news for CPT as an International station for SAA anyway, time will tell.