The business rescue practitioners (BRPs) of South African Airways (SAA) have confirmed that they would be able to pay SAA salaries in April, as they have also done each month since the airline went into business rescue in December last year.
But the Department of Public Enterprises (DPE) has informed unions and the SAA BRPs that they can no longer depend on financial support from government.
A request by the BRPs for an additional R10bn ($527m) in funding was recently refused by the DPE and they were told that they would have to continue with the business rescue process with whatever resources are available.
As for SA Express, its BRPs have already indicated that the airline will not be able to pay salaries for April unless it obtains financial support from COVID-19 relief funds. It has also not yet been able to pay March salaries.
In fact, the SA Express BRPs brought a court application in March to have the airline provisionally liquidated. The DPE is still studying the contents of this application, it said.
Once the flight bans due to the coronavirus lockdown are lifted, however, South Africans could see a rush of cheap airline tickets becoming available, especially in the domestic market, Elmar Conradie, CEO of low-cost airline FlySafair said during a recent webinar on the impact of the pandemic on the tourism industry.
This is because supply is expected to be much larger than demand at that stage and airlines cannot just have their aircraft stand on the ground.
IATA estimates that every job created in the aviation industry supports another 24 jobs in the wider economy.
Based on this estimate, the industry body believes 186 850 jobs could be at risk in South Africa, and the industry’s contribution to the country’s economy could plummet by about R68.4bn ($3. bn).
