South Africa to set up new airline to replace SAA

South Africa will be turning nearly a century of history of a company that was founded in 1934 and was considered a national pride.

The coronavirus crisis is poised to claim a major casualty in the airline industry, with South African Airways (SAA) already in debt and under financial trusteeship. The international context has accelerated its downfall. The government’s half-worded promised bailout will not take place.

The South African government has announced the creation of a new airline to replace SAA, which is on the verge of bankruptcy. Heavily indebted, South African Airways will soon disappear to make way for a new “restructured company which will be the standard bearer of South Africa,” according to a press release from the Department of Public Enterprises. The foundations of this new company have already been laid, adds the press release. “Stakeholders (…) have agreed on a long-term vision and strategy for the creation of a dynamic new airline.

The future company will take to the skies to replace SAA, which has become a financial abyss and a symbol of the mismanagement of South African public companies in recent years.

SAA is under permanent infusion with public money and has not made any profits since 2011.

The Covid-19 pandemic with the cessation of almost all world air traffic dealt the final blow to this flagship of the South African economy, which today employs 5,200 people.

Posted by on May 4, 2020. Filed under Business, News, Zoom. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.