Transportation Industry

Company Watch - South African Airways

AirGuide Business, July 21, 2008

7/21/2008

EgyptAir and South African Airways are Africa's largest carriers in terms of capacity, fleet and passengers, followed by Royal Air Maroc, Kenya Airways and Ethiopian Airlines. Star Alliance holds a 22% market share in Africa, followed by SkyTeam's 17% and oneworld with just 7%. Star is evaluating the possibility that EgyptAir and South African Airways might cooperate to create transfer points in Central Africa to boost intra-continental travel. South African Airways still is reconstructing its own network. The alliance also is reshuffling its schedule in Cairo to create more efficient flight connections and will benefit when the airport's new dedicated Terminal 3 opens this fall with the capacity to serve 11 million passengers per year. The 11 Star members currently serving Africa fly to 78 destinations in 36 countries. The alliance is discussing membership with Ethiopian, which is working on bilateral agreements with alliance members like Lufthansa. 7/14/2008

South African Airways reported a ZAR1.09 billion ($142.5 million) loss in the fiscal year ended March 31, widened from ZAR833 million the previous year, Bloomberg News reported. The result reportedly was driven by costs related to a restructuring program that included the grounding of its 747-400 fleet and nearly 2,000 layoffs. Excluding the restructuring costs, it was ZAR123 million in the black. CEO Khaya Ngqula said the airline is on course for a net profit in the current financial year, according to the news service. Sales climbed 9% to ZAR22.5 billion on a 15% increase in fares, although passenger numbers fell 1.3%. 7/18/2008

South African Airways is looking to lease three Airbus A319s/A320s and three A340-300s that will replace A340-200s. Krause said it favors the -300 over the A340-600 because the lighter aircraft is more fuel efficient. It is studying the possibility of launching service to China but would require an aircraft to operate the route nonstop. 7/14/2008

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