Velvet Sky: South Africa’s new airline take off


South Africans will be able to choose from a new airline next week when low cost carrier Velvet Sky takes to the air. The Durban based airline will ply the ‘golden triangle’ between Johannesburg, Durban and Cape Town.

Tickets will go on sale from the website from midday tomorrow and the airline’s inaugural flight will take off from OR Tambo on the Johannesburg to Durban route next Tuesday.
“Durban’s first ever airline is ready for take-off,” Velvet Sky said at a press conference and launch in Durban today, ending months of rumours about a new local carrier.
“Having spent the last two years assessing the trends and demands of the airline industry, we are extremely eager to enter this market and believe that now is, without doubt, the perfect time to do so,” says Cecil Reddy, chairman of Velvet Sky. “Velvet Sky will offer passengers more choice when making their travel arrangements through realistic scheduling, competitive pricing and adding capacity to the busier routes,” he says.
“Our approach to launching Velvet Sky has been particularly cautious, as our aim is to guarantee an operation that will ultimately delight the South African travelling public. The increased volume of air passengers has led us to believe that the market is ready for a new entrant to bring us back to the hallmarks of air carriage. Punctuality, safety and service,” Reddy says.

Velvet Sky Aviation was registered as a company in December 2008, and established in 2009 by a diverse group of local businessmen, with backing from Macdonald Holdings, a steel and engineering group that is new to the airline industry. Velvet Sky’s executive team consists of Dhevan Pillay, Gary Webb and Captain Paul Green.

The new airline will be based at Durban’s King Shaka International Airport. “Our corporate philosophy mandates cost saving through all levels of our operation. It was this mandate that dictated Durban, with its lowered operating costs away from the bustle of our competition, as the administrative hub of the business,” Velvet Sky said in a press release. As such, Velvet Sky is the first independent airline to be managed and run out of KwaZulu Natal.

The airline will fly Boeing 737-300s, with one initially being leased from Aergo. Aergo is a private leasing company based in Dublin, Ireland, that opened an office in Johannesburg in February. Christo Kok, head of Aergo in South Africa, said the first Boeing would conduct a test flight on Saturday, when it would also be accepted by Velvet Sky.
“We intend operating three Boeing 737 aircraft when we are at full strength. But as a new company we are adopting a prudent approach for now, and we will be phasing in our other two planes. We will, however, have other aircraft on standby to meet any service gaps,” confirms Reddy.

In May and June another two Boeing 737-300s will be leased to the airline, according to Kok, who says that based on Velvet Sky’s business plan, the airline could ultimately lease between six and eight aircraft. SAA Technical will provide maintenance for the Velvet Sky fleet.

According to Innovata, Velvet Sky will fly seven daily flights between King Shaka International, Oliver Tambo International and Cape Town International. These routes are currently served by almost all seven of South Africa’s main existing airlines, including, Mango, 1Time, South African Express, Airlink and British Airways.

Africa is the only region in the world showing strong growth in airline traffic, according to the International Air Transport Association (IATA), and South Africa is a competitive market with seven operational airlines. Both IATA and the Airports Company of South Africa (ACS) show the South African air travel market is expanding.

This means a lot of competition for new entrants, according to Stuart Cochrane, executive manager of Comair, which manages British Airways. He warns that the Johannesburg-Durban-Cape Town route is oversaturated and not up to more competition. He also noted that numerous other airlines have tried and failed to enter the South African market.

For instance, Nationwide Airlines began domestic operations in 1995, but ceased operations in April 2008 following cash flow problems that resulted from fuel price increases, decreased passenger loads and a grounding that came after an engine fell off one of their Boeing 737s in November 2007.

Another new low cost airline, Airtime Airlines, planned to start operations in January 2009 from Durban. It had planned an innovative booking system using cellphone banking, online banking and ATMs. However, Airtime did not get a license to operate in South Africa and its aircraft lease fell through.

However, according to Brand Channel, low cost carriers have made big inroads into the air travel market and are taking a large market share held by bigger, more well established companies like South African Airways and British Airways. Further assisting the expansion of low cost carriers has been the Airports Company of South Africa’s R5 billion expansion plan, which enables South Africa to carry 40 million passengers a year, according to Brand Channel.
“Our research indicates that there is an increase in air commuting while people are starting to take more frequent but shorter holidays. These and other market related factors combine to create demand for another carrier,” Velvet Sky said. Some other factors mentioned include full aircraft, higher fares at peak times and delays with existing carriers. “This is the market that we are moving into.”