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SAA halves flights to London

Cuts mean a material drop in capacity from April….
Once this change is effected in April, SAA will operate only 17% of the direct capacity on the SA to London route, from around 28% currently. Picture: Shutterstock

Struggling South African Airways will drop one of its two daily return flights to London’s Heathrow Airport from April 20 as part of its ongoing “network remediation”. The airline currently operates two daily flights, SA234 and SA236 at 21:00 and 21:55, with returns from the UK (SA235 and SA237) at 18:05 and 21:05.

In a statement, new CEO Vuyani Jarana said: “We have decided to focus on those areas of our business that will enhance our efficiencies, bring more value to our customers and produce improved overall performance of the airline. Network optimisation is one such area that can contribute towards containing our costs and we introduced some initiatives that must yield dividends to return the business to commercial sustainability in the shortest time possible.”

The difficulty for SAA on all its long-haul routes is the fact that aircraft sit idle for 12 hours (or longer) on the other side of the world (many of the global airlines flying to Johannesburg or Cape Town sit with the same problem on this side). Contrast this with an airline like Emirates, for example, which generally turns around aircraft in less than three hours on both ends. SAA’s lengthy turnaround time, to some extent forced by the overnight nature of the flights, means that four aircraft are idle for about half the time that they operate on this route. Add to this, inefficiencies from a cabin crew and pilot scheduling point of view, and you can appreciate that this route is not as lucrative as it seems.

Competitors on the direct route, British Airways (BA) and Virgin Atlantic, have and will continue to mop up the demand from (especially) corporate travellers. BA operates Airbus A380-800s on both daily flights to Johannesburg (it started on just one flight in 2014), and Virgin Atlantic flies the new Boeing 787-9 (Dreamliner). Both of these planes are significantly more efficient than the Airbus A330-200 and the ageing four-engined Airbus A340-300 that SAA currently flies to London. As part of this cutback to a single daily flight, SAA will introduce its new Airbus A330-300 on the route from March 25. This will not only address the fuel-efficiency problem, but will also help fix the passenger comfort and quality issues which come with flying ageing aeroplanes on a popular route such as this. SAA took delivery of five of these A330-300s last year.

It can seat 249 passengers (46 in business class), but on the two current daily flights, SAA offers between 444 and 475 seats, depending on the aircraft used. This nearly halves capacity on this route. By contrast, Virgin Atlantic offers 264 seats per day (including 31 in Upper Class and 35 in Premium Economy), while British Airways has 938 seats available (469 in each A380, including 14 in First Class, 97 in Club World (business) and 55 in World Traveller Plus (premium economy)).

This means that from April, SAA will operate only 17% of the direct capacity on this route, from around 28% currently.

Of course, the hub carriers in the Middle East and, increasingly, Africa have all but obliterated leisure demand on the pricier direct routes. Emirates, Qatar Airways, Etihad Airways, Turkish Airlines, Ethiopian Airlines and Kenya Airways all offer popular and cheap one-stop routes to London.

SAA has been forced into making this decision because of unavoidable decreases in the size of its fleet. Moneyweb reported in September that the airline was being forced to cut its fleet of (then) 62 aircraft by as much as ten. The chairman of the SAA Pilots Association, Jimmy Conroy, told Moneyweb at the time that five leased wide-bodied aircraft would be returned and four narrow-bodied aircraft would be transferred to other airlines (i.e. Mango).

This drastic cutback on the London route follows a number of cuts to its regional network made in the latter half of last year, decreases in frequencies on secondary domestic routes (Johannesburg-Port Elizabeth and Johannesburg-East London), and the steep cuts to the Johannesburg-Durban and Johannesburg-Cape Town announced in late December and effected last month. More than 80 return flights a week are impacted as the carrier effectively hands the bulk of its services on the Durban route and nearly half of those on the Cape Town one to its low-cost subsidiary, Mango.

Read: SAA makes steep cuts to Joburg-CT, Joburg-Durban routes

Its statement on the London changes hints at more to come as it turns “its attention to its international network”.

SAA does note that the very valuable second landing slot at Heathrow will be leased, and not sold. It controversially sold its third slot (which it used for a direct Cape Town service) in 2012.

Hilton Tarrant works at immedia. He can still be contacted at hilton@moneyweb.co.za.

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Mmmmm. Cutting flights but no decrease in personell. I would guess the airline with the most staff per mile flown is busy increasing that ratio. I wonder how that will pan out.

The other carriers such as British Airways and Virgin will simply add extra flights to London. Emirates is already carrying more than half the passengers that SAA used to carry with their many flights out of South Africa.

The way to increase SAA’s capacity and income is to enhance and improve on the routes that profit is being made. Get rid of dead wood staff. Relook at EVERY contract supplier and renegotiate your purchases such as fuel, food, cleaning, ground services, baggage handlers contracts, etc. Until that is done there is NO recovery. Fly on the routes that the other carriers find profitable and keep your fares at a realistic level. Also, keep ground time to a minimum. You only make money when the planes are in the air. Reduce the free giveaway tickets and renegotiate the masses of staff tickets SAA gives away. No more freebies – especially to politically connected passengers.

Form alliances with other carriers instead of seeing them as the enemy. Share services such as baggage handles and maintenance.

‘Relook at EVERY contract supplier’, unfortunately SAA is forced to use large percentage of BEE suppliers while other airlines not. This automatically increase the cost and reduce their competitiveness.

There is a possibility, maybe more than a possibility, that their suppliers are family members or associates that load the price and a few in the line get kickback thus the cost of fuel, food, services etc. cost SAA 3 or 4 time what it costs the competitors thus causing them to have to charge that much extra per seat and why the passengers thus fly on other airlines leaving SAA with losses instead of profit. It has nothing to do with BERE. It is about corruption.

While nine airlines fly overseas from Cape Town all year round and eleven in the SA summer season, SAA is not among them? A political decision years ago to punish the Western Cape for voting DA? If nine airlines can fly profitably from Cape Town, why can’t SAA? The inefficiencies the other commentators already alluded to, no doubt.

Cape Town better off without SAA !

Save the company into oblivion – if you can’t make profit on a route to London I think you should shut up shop!

Reduce flights that are always fully booked to fly to some African route with planes that are 75% empty. That is exactly why SAA is in trouble

That is the African way.

End of comments.

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