The struggling South African Airways announced that it is making an array of additional moves to transform the airline into a “sustainable and profitable business.” Changes include route network cuts, the usage of more fuel-efficient aircraft, optimizing the organizational structure and renegotiating contracts with suppliers.
On January 21, 2020, the airline already temporarily canceled some flights to preserve cash reserves. In addition, it also issued two tenders: one for nine Airbus A340 aircraft, the other for spare Boeing 747 parts. The latter tender expired on January 22, 2020.
The most visible change for the airline’s passengers will be the route network. South African Airways intends to only keep international flights between Johannesburg OR Tambo International Airport (JNB) and Frankfurt Airport, Germany (FRA), London-Heathrow (LHR), New York’s John F. Kennedy International Airport (JFK), Perth Airport, Australia (PER), and Washington Dulles International Airport, United States (IAD) via Accra, Ghana (ACC). Such routes like Guangzhou, China, Hong Kong, Munich, Germany and Sao Paulo, Brazil are cut to conserve cash.
On the domestic front, SAA would continue serving Cape Town International Airport, South Africa (CPT) on a “reduced basis,” while other domestic destinations would be served by either Mango, its low-cost subsidiary, or SA Express, its regional operator.
“SAA does not intend to make any further significant network changes. Passengers and travel agents can, therefore, feel confident about booking future travel with South African Airways,” states a press release issued by the carrier.
The airline will continue operating the ousted routes until February 29, 2020.
The statement indicates that in order to improve the company’s liquidity, rationalization programs are considered to sell some of the airline’s assets, including an overlook over its subsidiaries. Nevertheless, the Business Rescue Practitioners (BRPs) are trying their best to minimize job losses at the airline.
When the restructuring plan was announced in November 2019, the carrier’s unions began to strike over said job losses.
“It is our intention to restructure the business in a manner that we can retain as many jobs as possible. This will help provide a platform to a viable and sustainable future. However, a reduction in the number of employees will, unfortunately, be necessary”, stated the BRPs.