Mango, SAA’s low-cost airline, carried its 9 millionth passenger this week – a month before celebrating its sixth anniversary. Announcing this yesterday, chief executive Nico Bezuidenhout said it was “driven by an ideal of incessant growth across all areas of our operation”.
He said the provision of wi-fi on flights and the move into Lanseria Airport in Johannesburg’s northern suburbs in addition to operating from OR Tambo International Airport were “delivering a ramp to future growth”.
Forecasting that low-cost airlines held the key to the growth of the aviation industry in Africa, he estimated that due to their introduction, the South African airline market had grown by nearly 3 million people over the past decade and created well over 15 000 formal and informal employment opportunities “in various up and downstream market segments, through tourism and local entrepreneurs”.
However, all is not going smoothly for Mango. Trade union Solidarity, to which most Mango pilots belong, has declared a second wage dispute with the airline following one last year, on the grounds that it pays its pilots less than those at other low-cost airlines.
The spokesman for Solidarity, Johan Kruger, said that the airline agreed last December to start a phased process to bring its pilots’ salaries into line with those of their counterparts in other low-cost airlines over a three-year period. But in the latest consultation two days ago they failed to agree over market-related salaries.
Mango’s management are demanding that pilots’ salaries be adjusted according to those of low-cost airline 1Time, which are 3 percent higher than those at Mango, while Solidarity demands they should be in line with those paid at kulula.com, the low-cost division of Comair, which are 30 percent higher.
Mango’s management are resisting this on the grounds that Comair is not a low-cost airline.
According to Solidarity, a junior pilot at SAA – of which Mango is a subsidiary – is paid more than an experienced senior pilot at Mango.
Kruger said Solidarity was committed to continuing negotiations and to seeking a solution at the negotiating table.
1Time, like most airlines throughout the world, has been hit by the soaring price of aviation fuel and is trading under the protection of business rescue and has instituted a cost-saving programme.
SAA and Mango have not yet reported their financial results for the year to March, although SAA has asked for recapitalisation by the government, its sole shareholder, to enable it to buy fuel-efficient new-generation aircraft as other airlines worldwide are doing. Comair returned to profitability at its year-end after reporting its first ever loss for the first half of its financial year.
Bezuidenhout said yesterday that the number of Mango passengers using Lanseria Airport was growing rapidly and had shown that the investment was worthwhile.
Pointing out that flights by low-cost airlines outnumbered those by full-service airlines by three to two on South Africa’s “golden triangle” between Cape Town, Durban and Johannesburg, he forecast that this would soon be the case throughout the continent.
Asset utilisation was about 15 percent to 30 percent higher by low-cost airlines than by full-service airlines. An aircraft earned money in the air but “on the ground it burns money with no return on capital”.
Bezuidenhout said that despite a 45 percent rise in input costs such as fuel he was upbeat about the future of low-cost aviation in this country.