SAA, SAX to focus on Africa: Gigaba


The focus of SAA and SA Express I the coming year is on expansion in Africa which will contribute significantly to economic integration on the continent, Minister of Public Enterprises Malusi Gigaba says.

“SAA’s primary focus on the African continent is to establish itself as a leading network carrier from OR Tambo International Airport (ORTIA) to other primary airports across the continent. SAA plans to introduce additional routes and frequencies to broaden operations and improve its African footprint,” he said in his annual budget vote yesterday.
“This strategic focus is also fundamental to SAA’s strategy to strengthen its balance sheet as the African market boasts good demand and better profit margins,” he said. “SAA has two long term financial challenges: the first is to capitalise itself through the accumulation of strong retained earnings, and second, to ensure that adequate cash is available to fund the Airbus transaction without government financial support.”

This involves the renewal of the SAA fleet through the acquisition of Airbus A300-200 long-range aircraft as well as A320 short-haul aircraft. “Between 2011 and 2015, we will acquire 25 additional aircraft of varying ranges which we will use for long-range as well as domestic and regional hauls, further to enhance SAA’s fleet capacity. These new fuel efficient aircraft will significantly improve the airline’s service offering and will have a positive impact on the reputation of SAA as a leading airline on the continent,” the minister said.
“On the other hand, SA Express (SAX) has a route network covering five African countries and it acts as a strategic feeder connecting secondary airports with each other and also with large hub airports, Gigaba said. “Most significantly SAX plays an important role in providing safe and reliable air services in African states where safety and reliability is challenging.”

SAX last year launched Congo Express as a joint venture airline with Biz Afrika based at Lubumbashi in the Democratic Republic of Congo. “However, other commercial risk factors have resulted in SAX withdrawing operations from this route. With commodity led economic growth in Africa, SAX is optimistic about its expansion plans in the continent and has identified the under-utilised cargo business as a core focus area.
“The new operating model for the cargo business will be finalised this year which may include the conversion of current aircraft into dedicated freighters. In 2010/11, SAX embarked on a fleet renewal plan with the objective of meeting demand over the next 10 years aimed at delivering improvements in reliability, introducing cleaner technology to reduce green house emissions and offering greater customer comfort while remaining cost efficient.
“The acquisition of new aircraft will commence in the first half of this year and result in the average capacity growth of 8.6% per annum over the next four years,” Gigaba said.