Audrey D’Angelo
A battle between three local airlines is expected to reach its final stage in the North Gauteng High Court this week. Safair’s new low-cost airline, FlySafair, is on the brink of starting flights between Johannesburg and Cape Town, with take-off planned for October 17.
But Comair and Flywise, a new low-cost airline which the original founders of 1time are preparing to start, have obtained an interdict against it and the case is expected to be decided this week.
Fares on the route rocketed when 1time went out of business late last year, leaving only full-service airlines Comair and SAA and their low-cost divisions, kulula.com and Mango, to compete.
FlySafair is selling tickets on the internet at below the fares recently charged on the route and Flywise plans to do the same, but with fewer flights than FlySafair, which will start with six flights a week, rising to 10 by the end of this year.
Flywise has leased two Boeings and is waiting for its manual to be approved by the licensing authority before launching.
FlySafair chief executive Dave Andrew has been delighted by the bookings it is receiving and is insistent that its operating licence is valid and it complies with the requirement that 75 percent of the voting rights must be held by South Africans.
But Comair and Flywise maintain that Safair is foreign owned by the Irish ASL Aviation Group and is, therefore, barred from operating a South African domestic airline.
Asked to comment on the current situation Andrew said yesterday: “On Friday the case between Comair and FlySafair was heard, the judge has advised that he will provide judgment early this week.”
Comair chief executive Erik Venter said earlier that allowing a foreign-owned airline to operate a domestic airline opened the door for a large international airline to dominate the market.
Suggesting that FlySafair’s three controlling shareholders were a “front” for ASL, he claimed that the three had not been required to pay for the shares, which they held only while employed by the company and that they received no dividends from Safair.
Andrew said Safair agreed with the concept of a domestic airline industry where all airlines were required to comply with the applicable aviation legislation and to compete fairly and equally with one another for market share.
He said it was for this reason that “Safair Operations, which owns and operates low-cost carrier FlySafair, has a 75 percent South African shareholding in accordance with the Air Services Licensing Act.
“The remaining 25 percent of voting rights in Safair Operations is owned by Safair Aviation Ireland, which in turn is wholly owned by the Irish ASL Aviation Group.
“I believe it is also pertinent to reiterate that Safair has had a 75 percent South African shareholding since 2009. No organisation or individual has ever questioned this structure before. So it is surprising that Comair is raising objections now that we have announced the launch of a low-cost competitor which will naturally challenge its kulula operation.”
Andrew said he held 25 percent of the voting rights in Safair Operations and grew up on the East Rand of Johannesburg. Elmar Conradie, the financial director, who holds a further 25 percent of the voting rights, grew up in Odendaalsrus.
Hugh Flynn, the third director to hold 25 percent of the voting rights, was born in Germiston and grew up there. He served in the SA Air Force, currently holds a South African commercial pilot’s licence, started working for Safair in 1984 and became president of Safair Freighters (USA) in 1986.