SAA to start job cuts?

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Re: SAA to start job cuts?

Unread post by southside » Thu Nov 14, 2019 5:16 pm

Thank you evanb.

Would there be no way for Airlink to continue operations with SAA codeshare, or to just operate independently of SAA? Could this not be negotiated? Could the 1 Billion owed to Comair not come from a cash injection from treasury as they always do to pay this off?

All the others that are owed money...even the guarantees that would be due immediately...if there is no money for it immediately then there is no money...pay it off over time. Instead of plunging the money into the hole that already exists and making it deeper?

Who exactly does treasury owe this money to? Would SA be blacklisted when needing money in future from outside investors? Just trying to think worst case here.

I have to say I know almost zilch about the intricacies of this environment, perhaps my posts reflect that. But I just have to think in terms of cutting your losses and stop trying to fix something that can't be.

Maybe it would be bad initially, but over time would it not be the better option? Instead of just making a never ending situation worse?

Soon SAA will need another 5 Billion. Every time I see an SAA aircraft flying, or SA Express, I picture hundreds of thousands, if not millions of Rands in CASH being thrown into a massive bonfire, a complete waiste. Why not use that to fix the countries economy instead of digging a deeper hole?
Last edited by southside on Thu Nov 14, 2019 5:46 pm, edited 1 time in total.
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Re: SAA to start job cuts?

Unread post by evanb » Thu Nov 14, 2019 5:45 pm

southside wrote:
Thu Nov 14, 2019 5:16 pm
Would there be no way for Airlink to continue operations with SAA codeshare, or to just operate independently of SAA? Could this not be negotiated?


All Airlink's capacity is distributed through the SA code and 083 ticket stock. This would cease to be active if SAA closed and wouldn't be negotiable due to the IATA settlement rules. It would take some time for Airlink, and at considerable cost, to gain the same global access to distribution that they have at present.
southside wrote:
Thu Nov 14, 2019 5:16 pm
Could the 1 Billion owed to Comair not come from a cash injection from treasury as they always do to pay this off?


Why would Treasury chose to honour this preferentially or directly rather than just let is play out will all other unsecured debt? This debt is not secured or guaranteed by Treasury.
southside wrote:
Thu Nov 14, 2019 5:16 pm
All the others that are owed money...even the guarantees that would be due immediately...if there is no money for it immediately then there is no money...pay it off over time. Instead of plunging the money into the whole that already exists and making it deeper?
Debts guaranteed by Treasury would fall due on Treasury, not on SA. They would have to pay immediately. If they didn't all government bonds would default. See it as you signing surety on someone else's overdraft. If they are unable to pay, the bank will come to you and demand it immediately. If you can't or won't pay, they will go to court and attempt to liquidate you. Same principle here.
southside wrote:
Thu Nov 14, 2019 5:16 pm
Maybe it would be bad initially, but over time would it not be the better option? Instead of just making a never ending situation worse?
I think people underestimate the effect of the loss of capacity. Private carriers who are motivated by profit will not will replace all this capacity in the short term but rather use it to raise their prices.
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Re: SAA to start job cuts?

Unread post by Burner » Thu Nov 14, 2019 5:45 pm

SAA strike to go ahead, unions say their demands must be met

https://www.fin24.com/Companies/Industr ... -20191114?
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Re: SAA to start job cuts?

Unread post by southside » Thu Nov 14, 2019 5:58 pm

Thanks again evenb. You make sense. So we are snookered and the only option is to try and fix the unfixable. Such a shame that a once profitable and majestic airline has rotted because of government policies. They don't care though...the ones at the top. They are the wealthy ones. They will just promise jobs to the unemployed in future and be realected, with the continued downward spiral until there is nothing left.
The Zimbawian boarder just encroached South Africa further.
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Re: SAA to start job cuts?

Unread post by Piperdriver » Thu Nov 14, 2019 6:22 pm

Another adverse effect that will flow to both Sax and Airlink if SAA is liquidated is that SAA holds a significant portion of their forward sales, this money is normally paid over once the passenger has flown. These forward sales cash holdings would be tough to get out of a liquidation for quite a while.
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Re: SAA to start job cuts?

Unread post by evanb » Thu Nov 14, 2019 6:32 pm

southside wrote:
Thu Nov 14, 2019 5:58 pm
Thanks again evenb. You make sense. So we are snookered and the only option is to try and fix the unfixable. Such a shame that a once profitable and majestic airline has rotted because of government policies. They don't care though...the ones at the top. They are the wealthy ones. They will just promise jobs to the unemployed in future and be realected, with the continued downward spiral until there is nothing left.
The Zimbawian boarder just encroached South Africa further.
I wouldn't say snookered ... but I do get concerned that many people don't consider the negative externalities of SAA failing. I'm not suggesting that they are insurmountable, but they're often ignored.
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Re: SAA to start job cuts?

Unread post by WILDOG » Thu Nov 14, 2019 8:53 pm

Lets look on the bright side, tomorrow (Friday) and Sat will probably be the two most profitable days that SAA has had in the last 10 years :lol: :wink:
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Re: SAA to start job cuts?

Unread post by jvdl » Thu Nov 14, 2019 9:29 pm

Sorry, I've not managed to read through the whole thread in detail, so not sure if this has been answered.

Will Mango flights be affected by strike action / retrenchments? My brother is flying up for the holidays (in December) and I think it may be a better idea for him to fly Safair from CT to Joburg and Airlink to Bloem?
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Re: SAA to start job cuts?

Unread post by sLNKy » Thu Nov 14, 2019 9:48 pm

jvdl wrote:
Thu Nov 14, 2019 9:29 pm
Sorry, I've not managed to read through the whole thread in detail, so not sure if this has been answered.

Will Mango flights be affected by strike action / retrenchments? My brother is flying up for the holidays (in December) and I think it may be a better idea for him to fly Safair from CT to Joburg and Airlink to Bloem?
Only affects flights operated by South African Airways, Mango, Airlink and SA Express flights will be operating.
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Re: SAA to start job cuts?

Unread post by AOYB » Thu Nov 14, 2019 10:17 pm

jvdl wrote:
Thu Nov 14, 2019 9:29 pm
Sorry, I've not managed to read through the whole thread in detail, so not sure if this has been answered.

Will Mango flights be affected by strike action / retrenchments? My brother is flying up for the holidays (in December) and I think it may be a better idea for him to fly Safair from CT to Joburg and Airlink to Bloem?
As said, Mango and the others operating normally. With additional capacity for SAA passengers. Mango has added quite a few flights tomorrow
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Re: SAA to start job cuts?

Unread post by Romeo E.T. » Thu Nov 14, 2019 10:41 pm

sLNKy wrote:
Thu Nov 14, 2019 9:48 pm
jvdl wrote:
Thu Nov 14, 2019 9:29 pm
Sorry, I've not managed to read through the whole thread in detail, so not sure if this has been answered.

Will Mango flights be affected by strike action / retrenchments? My brother is flying up for the holidays (in December) and I think it may be a better idea for him to fly Safair from CT to Joburg and Airlink to Bloem?
Only affects flights operated by South African Airways, Mango, Airlink and SA Express flights will be operating.
QUESTION : Airlink and SA Express flights will be operating.

Don't Airlink and SAX use the SAA booking, SAA ground staff, checking agents etc, won't this have an effect on their operations, even though from an aircaft operation, they are independant ?
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Re: SAA to start job cuts?

Unread post by evanb » Thu Nov 14, 2019 10:59 pm

Romeo E.T. wrote:
Thu Nov 14, 2019 10:41 pm
Don't Airlink and SAX use the SAA booking, SAA ground staff, checking agents etc, won't this have an effect on their operations, even though from an aircaft operation, they are independant ?
No, SAX and Airlink use the SAA reservations system and ticketing, but they don't use SAA ground staff (e.g. checking, baggage, etc) for the most part.
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Re: SAA to start job cuts?

Unread post by GL » Fri Nov 15, 2019 5:09 am

evanb wrote:
Thu Nov 14, 2019 5:45 pm
I think people underestimate the effect of the loss of capacity. Private carriers who are motivated by profit will not will replace all this capacity in the short term but rather use it to raise their prices.
Agreed - there will be a significant loss of connectivity resulting in a mutiplier's worth of harm done to SA economic growth. It would take a few month's or even years for alternate connectivity to fully fill the void.
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Re: SAA to start job cuts?

Unread post by ERASER » Fri Nov 15, 2019 5:55 am

evanb wrote:
Thu Nov 14, 2019 3:29 pm
ERASER wrote:
Thu Nov 14, 2019 6:01 am
Mr Evan, I think your assumption is wrong..................this says it all........South African Airways (SAA) has cancelled nearly all its domestic, regional and international flights scheduled for Friday, 15 November and Saturday, 16 November 2019.......SAA is very unionized, thus all the unions are talking from a position of power within SAA/SAAT.
I think you may have misunderstood what I said, and my point wasn't properly explained. An airline doesn't exist without pilots, that gives SAAPA power. Nearly every other job at SAA, maybe with the exception of cabin crew, can be outsourced. Whether it's reservations, baggage handling, cargo handing, ground handling, line maintenance, heavy maintenance, dispatch, catering, cleaning, etc.

SAAPA used their threats of strikes to actually gain concessions from SAA and government. Other unions can gain little to nothing by striking now. Other than the pyrrhic victory of actually striking, what can they gain?
I don't know the regulatory implications with SACAA, but what if an airline wet lease or charter aircraft even pilots and cabin crew can be outsourced. Outsourcing comes at an price..........
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Re: SAA to start job cuts?

Unread post by Ray W » Fri Nov 15, 2019 6:27 am

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