For more than a decade now South African Airways is suffering from "haphazard" management. The state-owned company, plagued by scandals, has been exposed to strikes by its staff, the most recent episode of which last November precipitated a situation of near-bankruptcy. Since 2004, no fewer than six CEOs have succeeded one another at the head of the airline, while plans to restructure the fleet and slim down the network of destinations have multiplied since the end of the 90s. And all without producing any notable results.
On theEurope for example, while South African Airways was at one time the Africa's leading transport network in terms of the number of destinations, it is now behind its rivals Kenya Airways or Ethiopian Airlines. In fact, while SAA was still the continent's leading carrier in 2010, with more than eight million passengers, it has now been overtaken by Ethiopian, with more than ten million passengers, and by Egyptair, which is flirting with nine million passengers. South African should end 2019 with some seven million passengers.
Over the past fifteen years, South African Airways has ceased services to Paris CDG, Saint Denis de la RéunionZurich, AthensCopenhagen, AmsterdamMilan, Rome and Manchester. Its intercontinental network now comprises just under ten destinations, including FrankfurtLondon and Munich in Europe, New York, Sao Paulo and Washington in the Americas, as well as Perth and Hong Kong in the Asia-Pacific region - the latter destination having been temporarily suspended due to the violence in the former British colony.
The placing of South African Airways in receivership is therefore the last-ditch attempt from the government to save the company from potential bankruptcy. As under Chapter 11 of the US Bankruptcy Protection Act, SAA's rescue plan allows the company to protect itself from demands for repayment from its creditors. An independent administrator has been appointed to implement decisions relating to the restructuring of the company while working on a series of options to preserve the company's jobs and activities.
A provisional recovery plan must be submitted before 20 December. If the employees and shareholders agree, the final rescue plan should be adopted in early 2020. In the meantime, aircraft are flying without any noticeable change to schedules or frequencies... at least until January.
