Pic: Moneyweb
The Department of Public Enterprises on Friday announced a new strategy to save South Africa’s collapsing national carrier South African Airways (SAA), which has been in business rescue since December.
Declaring a new leadership compact agreed upon by all stakeholders, it said the airline would be embarking on a restructuring drive from which will emerge a “new SAA” that will be internationally competitive for safety, quality and cost in a post-Covid-19 world.
“A new and bold approach is required if there is to be any chance that South Africa can retain vital airlift capacity and trade connections, through a strategic national asset, with both public and private sector participation, which is internationally competitive, viable, sustainable and profitable,” the department said in a statement.
The new airline will be funded through a variety of options, such as strategic equity partners, funders and the sale of non-core assets.
The department warned that jobs would be lost as the airline moves towards a “performance-based culture” but that it would look to mitigate these losses through measures such as preferential re-employment, reskilling and enterprise development opportunities.
The announcement comes after the business rescue practitioners tasked with salvaging SAA cautioned on April 23 that without further funding from the government, the airline would not be able to continue trading or pay salaries beyond April.
Unions and non-unionised employees had until April 24 to either agree to a soft wind-down of the airline, with severance packages, or face the liquidation of the national carrier.
- African News Agency
