Trade relieved by SAA plans

Trade relieved by SAA plans

December 6, 2019 SAA 0

The travel trade has expressed relief that an actionable decision has been taken to move SAA forward, following the announcement that the airline will enter business rescue.

It’s a great decision and long overdue, says director of TAG, Jonathan Gerber. “The country can’t keep bailing the airline out and it is positive that important decisions have been taken out of the hands of government and will be placed with a business practitioner.”

For now, it means business as usual for operations, says Jonathan. When a practitioner is appointed, it will look at loss-making routes and likely cut those with no hope of profitability. The practitioner will also have the ability to move forward with retrenchments, he says.

Ceo of XL Travel, Marco Ciocchetti, believes government has made the right decision and hopes that a competent practitioner, with an understanding of the aviation sector, will be appointed to make decisions to keep the airline flying.

It is reassuring to know that the airline will be given the funding it needs in order to enact changes, says Marco. “We sent out a message to our members this morning encouraging them to keep supporting the national carrier. Many American carriers have been in this position before and have emerged as stronger airlines.”

He says he is confident the airline will make it through peak season, as any logical business practitioner would plan for route cuts to come into effect after that.

Gm of product, marketing and operations of The Holiday Factory, Flora Fubbs, agrees, saying the announcement has given the trade confidence that the airline will make it through the peak season without disrupting travellers’ plans.

Business rescue protects SAA from creditors. Where agents are creditors there could be delays in payments. However, Jonathan doesn’t believe this is an issue as, he says, SAA overrides have dwindled in the last few years.

The airline is no longer agencies’ biggest supplier, he says. “Despite this, SAA remains a big player and it would have been difficult for agents to have stopped selling the airline during the recent period of uncertainty. In many cases SAA remains the best option for many routes and TAG has been taking a pragmatic approach to sales on a day-to-day basis.”

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