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THE decision by South African Airways to can its direct flights between London and Cape Town is a bewildering one, and I can’t help but suspect something more at play than just economics. Is this one more step in the creeping isolation of the Western Cape and of Cape Town because we are the only province not controlled by the ruling party? Surely not?
It is clear by the reaction from local and regional tourism and business authorities that the issue was not canvassed with them, and that this was a unilateral decision by the national carrier.
And that’s the key phrase here – national carrier. SAA is not just another airline, it is a state owned enterprise and the international bearer of the South African flag.
Sure, everybody knows that the airline industry worldwide is in trouble, with airlines battling to make profits, faced as they are with fierce competition, an oversupply of seats and rising fuel prices. Add to that the global recession, the financial near-collapse of the euro zone, and the fact that Americans, traditionally the world’s biggest travelling market, have tended to stay home and avoid air travel like unprotected sex since 9/11.
But even with all these factors, SAA’s decision to end the London to Cape Town direct routes is perplexing. Both cities routinely rank in the top 10 tourism destinations in the world. Cape Town routinely ranks as Africa’s number one tourist destination, and bounces around the top three world destinations in survey after survey.
And here is the big question: will SAA allow other airlines to take over its London to Cape Town routes? Because SAA has virtual control of the South African skies, and over code-sharing routes and bilateral agreements, something that has been a longstanding source of anger among its competitors. SAA, they say, has an unfair advantage by virtue of its being both a government-owned body, and a de facto private enterprise unit competing unfairly in the market.
A very cushy position in which to be – it’s a bit like Pick n Pay being able to tell Woolworths or Shoprite “you can’t open a branch in Pofadder because we’re already there.”
That is effectively what SAA is licensed to do. And it is artificially limiting the number of tourists Cape Town can accommodate because of profit-oriented considerations. What they should be doing is flying the routes, like Cape Town- London, that are good for our tourism industry and good for the image of South Africa, as well as those that are highly profitable.
We’re in a similar situation here to Australia, with the routes between Europe and South Africa, and Europe and Australia, among the least economical longhaul routes in the world with very low yield factors. This was one of the key reasons why Australia’s national carrier, Qantas, has not privatised – their geographical location. They are also in danger of being cut off from the world, and like us, don’t have a slew of other carriers that could step in and take over the routes if SAA (or Qantas) went down the tubes.
I was intrigued to read an interview with the (relatively) new CEO of SA Tourism, Thulani Nzima, done in May. He said that while at SAA, “my job included securing commercial and bilateral agreements, code share agreements and undertaking feasibility studies for new air routes”. So he understands the issues all too well.
The interview, in our sister newspaper, The Mercury, said “the tourism sector was being taken more seriously than ever before by the government, having been identified as one of the five key sectors for economic growth and job creation in the country.”
Nzima told The Mercury that “this industry is about relationships and collaboration. Each different business – from the hotel sector to the Airports Company of South Africa, adds value to the industry. We are all interlinked and need to co-operate in order to deliver a world-class travel and tourism experience”.
Indeed. Which makes me wonder if SAA consulted Nzima before they took the decision to cut Cape Town off from direct flights from one of our biggest single tourism markets, the United Kingdom. Who did they consult? I’d be intrigued to hear from my old friend, SAA chairperson Cheryl Carolus, who was born and bred in Silvertown, just down the road from the airport, what the logic was behind the decision, other than financial.
Because it does feel as though, once again, Cape Town and the Western Cape are being punished for daring to vote someone other than the ANC into power.