The business rescue practitioners say 29 of the fleet of 48 planes, various routes and inefficient services also need to go in the state-owned airline is to survive
The cost of a decade of mismanagement at SAA has been laid open in its retrenchment notice sent to workers and unions. It notes that, in the past six years, the state-owned airline made cumulative losses of R26.1-billion.
These details are in the section 189 notice sent by rescue practitioners Les Matuson and Siviwe Dongwana on Monday. It also cites increasing debt levels, volatile fuel prices, the weak rand, the airline’s aging fleet and insufficient cash to cover SAA’s costs. They added that the negative media coverage after the airline was placed under business rescue had a marked negative effect on SAA between November 2019 and January this year.
Despite the various tranches of financing over the past three months, SAA’s revenue dropped by R884-million compared with the same period last year. The notice says the current structure of SAA is not economically viable and, if it is not changed, the airline could be liquidated and all its employees could lose their jobs.
The rescue plan is scheduled to be finalised on March 31, two months before the consultations with labour are due to be concluded. The rescue practitioners have therefore proposed that the consultations be concluded by 9 April to avoid SAA being liquidated.
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