SAA is pursuing partnerships to expand its reach as it grapples with rising fuel costs and continued scrutiny over its financial position.
Acting CEO, Matshela Seshibe, outlined the strategy at the 14th Aviation Stakeholders Convention being held in Johannesburg this week, where he said SAA was striving for sustainability.
“With the turbulence that we see around the world, our immediate term plan is to stabilise the airline against a very serious shock that has taken place in the aviation world,” Seshibe said, referring to rising jet fuel costs.
High refining costs in South Africa have added further pressure to jet fuel prices, Seshibe said. Fuel costs had been pushed up not only by higher crude oil prices but also by wider refining margins.
SAA has absorbed part of the recent fuel-price increase, passing about 50% to 60% on to passengers through higher fares, while reducing frequencies. In early May, it announced a reduction of frequencies on its Cape Town, Durban, Gqeberha and Gaborone routes.
Despite these challenges, Seshibe said the airline was committed to continuing its network expansion plan.
“SAA is excited about the prospects for growth in Africa in the medium- and long-term. We are in the process of finalising our route network expansion plans. We are currently operating more than 14 of our routes on the African continent and we are looking for more options,” he said.
The airline plans to leverage its partnerships to maintain its domestic network. “We are looking to collaborate. This includes private-sector airlines,” Seshibe said.
“For example, we recently finalised a partnership with CemAir to expand our reach into smaller airports that are not convenient to operate to because of the size of aircraft that we currently operate.”
SAA also plans to further leverage its Star Alliance membership and codeshare agreements to extend its network reach.
SAA’s expansion plans would not rely on government funding, he said. “SAA’s growth strategy is not just linked to its [government] ownership. It’s linked to strategy. It’s linked to partnership. It’s linked to collaboration on a wider scale,” he said.
