Riyaz Patel
Struggling state-owned airline South African Airways (SAA) could cut more than 900 jobs as it restructures to stem severe financial losses, the entity said in a statement Tuesday.
SAA said it had started consultations with its more than 5,000 staff and was talking to labour unions.
“South African Airways has informed all its 5,146 employees that it is embarking on a restructuring process which may lead to job losses,” the SAA statement said.
The proposed restructuring includes all SAA divisions and departments, but it excludes excluding its Mango Airlines, Air Chefs and SAA Technical units, it said.
The national carrier said it is facing “numerous challenges” including insufficient revenue, volatile fuel prices and mounting debt.
The embattled airline has not made an annual profit since 2011 and is grappling with severe funding difficulties and an inefficient and ageing fleet of airplanes.
Finance Minister Tito Mboweni announced in February that the government would reimburse the company’s R9.2-billion debt over the next three years.
South African officials have been searching for an investor to take a stake in the airline, but their efforts have so far been unsuccessful.
Richard Branson, the founder of Virgin Atlantic has said he is open to considering buying an equity stake in struggling SAA.
“I have great difficulty in life saying no,” the British billionaire said in an interview last Thursday.
“I’m known as Dr Yes at Virgin, so if we were approached by the SA government, we’d definitely have a look,” Branson said.
“We urgently need to address the ongoing loss-making position that has subsisted over the past years. That is why we are undergoing a restructuring,” said SAA acting-Chief Executive Zuks Ramasia.
“No final decision will be taken until the consultation process is concluded. However, it is estimated that approximately 944 employees may be affected.”
Trade union, the National Transport Movement, threatened a “total shutdown” of SAA over the proposed job cuts.
In a dramatic fall from grace over the past decade, SAA has lost its place as Africa’s biggest airline and a symbol of patriotic pride to become a source of frustration for taxpayers.
