Aviation in dire straits: SAA
South African Airways (SAA) has admitted to battling “extreme pressures” in the aviation sector, with fuel costs posing ongoing concerns for the airline.
Addressing a media briefing at Indaba on Monday, chief executive Siza Mzimela said global aviation was facing the worst ever conditions as ongoing high fuel prices took their toll.
Challenging market forces were equally to blame, she said, adding that the difficult conditions were being felt right across the globe.
“The global airline industry is under extreme pressure… It has never been this bad,” she said. “Many major airlines, including Lufthansa and Emirates have also seen substantial decline in profits, which is a clear indication of how difficult times are."
Mzimela said consistently high fuel prices were likely to hit the airline with R$6 billion in additional costs, but added increasing airport charges were an “additional concern”.
“We are watching the price of fuel very carefully at the moment, but the increase in airport use charges also poses a significant challenge."
Mzimela admitted the airline was “hurting”, but remained confident an aggressive growth strategy would heal the wounds.
SAA launched direct services to Beijing in January on top of several new regional services last year. It also entered a codeshare agreement with Air China in February and has plans to ramp up services from Johannesburg down the track.
Yet connections to Australia remain uncertain following the International Air Services Commission (IASC) decision to end its codeshare arrangement with Qantas.
However, Mzimela said the issue would be resolved in “a few weeks”.
“Australia is a key market for us and our plans will include connections in Australia,” she said. “We are continuing in discussions and working towards reaching a decision.”
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