SAA cuts direct flights to India, China

“At this point Emirates
carries a big chunk of the
Indian market as it is cost
effective and has many
options from Dubai into India.”
Wally Gaynor, md of Club
Travel, says India is an up-andcoming
destination for SA
travellers. “With the imminent
visa-on-arrival for South
African passport holders, India
will become a major tourist
destination for South Africans
looking for alternatives to the
likes of Thailand.”
SAA is also considering
re-routing its direct flights to
New York and Washington
to include a stop either in
Senegal or Ghana. Industry
leaders agree this added
stop will impact on corporate
travel. “There is no way our
corporates will make a stop in
West Africa. I think Delta will
probably score from this,” says
Geraldine Boshoff, marketing
manager of Sure Travel.
 SAA has more than doubled
its nett loss for the 2014
financial year to R2,5bn from
R1,17bn in the previous year.
 A weak rand and high
fuel prices had affected the
financials for period in review,
said cfo, Wolf Meyer. Also,
revaluation of seven wide-body
aircraft owned by SAA resulted
in an impairment of R782m.
While SAA’s international
routes remained lossmaking,
its contributions
from domestic and regional
operations grew by 10% and
17% respectively.
SAA has been reliant on
guarantees from the South
African Government for
several years and the delay
in the release of the financial
statements for the 2013/14
financial year is directly
related to the continued
weakness of the company’s
balance sheet and due
to the company being
technically insolvent. Currently,
guarantees total R14,3 billion.
“The lack of implementation
of several critical aspects of
the Long-Term Turnaround
Strategy during the latter half
of the period in review has
resulted in the need for a
further guarantee, as issued
in December 2014, to ensure
the continued going-concern
status of SAA over the shortterm,”
the airline said.
“A full review of the LTTS
is under way to ensure
revalidation in line with
the current needs of the
business, given SAA’s failure
to adequately implement the
plan. The 90 Day Action Plan
period ends on March 24,
whereafter implementation
of a revalidated LTTS will be
resumed.”