South African Airways To Be Replaced With Brand New National Airline



The South African Government has officially marched forward to shut down South African Airways and form a brand new national carrier.


South African Airways To Be Replaced With Brand New National Airline
South Africa will see a new national airline Photo: SAA

South Africa is looking forward for the foundation of a new national carrier out of the ashes of current state-owned carrier, which is on the blink of being placed in liquidation.

This decision for a new national carrier was made official on 1st May by the South African Department of Public Enterprises. 



An agreement has been reached between the South African Airlines unions and government as reported by the SABC News.

In a statement, the Department of Public Enterprises mentioned that the new airline would require mix participation of both private and public sector.


South African Airways To Be Replaced With Brand New National Airline
South Africa will terminate contract for all employees Photo: Getty

The South African Government will source funding of 2.2 billion rand ($117 million) for the payment of the severance packages to its employees.

This official decision to shut down the airline will terminate contract of all SAA employees. The carrier was in talk with unions to lay-off its strong workforce of 4,700 employees few weeks ago.



However, these employees would be given high priority for employment in the new restructured flag carrier. 

This type of mutual participation of private and public sector will allow the airline remain financially viable and profitable. Several tough decisions can also be easily made through this effort.


South African Airways To Be Replaced With Brand New National Airline
The employees will be paid on different basis Photo: SAS

The National Transport Movement president, Mashudu Rephetha, said that negotiations are progressing well with the government. 



In a statement, the president said:

"It is a very sad day for the whole of the Republic that SAA is now going to shut down and we are now going to witness the emergence of the new airline."

In a statement provided to Bloomberg, Public Enterprises Minister Pravin Gordhan said:

"The old SAA is dead, there is no doubt about that, but what will take its place may be some or all of the old SAA and maybe some other airlines too."


South African Airways has not been profitable since 2011 and has received more than 20 billion rand ($1.1 billion) in government bailouts in the last three years.


South African Airways To Be Replaced With Brand New National Airline
This transition will not be easy for SAA Photo: SAS

The main objective of this new airline is to have a financially viable and competitive airline for the nation after COVID-19. However, this transition will not be that easy for the newly restructured airline.



The state-owned carrier entered a form of bankruptcy protection back in December and the business rescue team has been working to save the flag carrier since then.

However, these efforts were heavily disrupted by the corona virus pandemic. The carrier suspended all commercial passenger flights due to the global coronavirus pandemic.

SAA's administrators, led by Les Matusona nd Siviwe Dongwana, were working on the rescue plan for the flag carriers future.



However, they failed to reach an agreement with government that could save the flag carrier from being collapsed.


South African Airways To Be Replaced With Brand New National Airline
SAS has suspended all flights since December Photo: From Web

The restructured carrier will hopefully have a skilled, competent and experienced management.

Let's hope the restructured South African Airways will again soar again soon and get back to it's former good times.

Do you think this new airline could replace South African Airways? Feel free to share in the comments below:

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