File picture: Reuters
File picture: Reuters

SAA Technical withdraws services to parent company over non-payment

By Reuters Time of article published Sep 26, 2020

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Johannesburg - South African Airways' maintenance subsidiary has withdrawn services to its parent after the struggling airline failed to pay money owed to the unit, an SAA spokesman said on Saturday.

Administrators took control of SAA in December after almost a decade of financial losses, and have been trying to keep it afloat as the coronavirus pandemic compounds its problems.

Spokesman Tlali Tlali said SAA Technical, a subsidiary of SAA that provides vital maintenance services including inspections required before a flight can take off, had informed the airline of its decision in a letter.

"SAA Technical... as a company registered on its own is pursuing its commercial interests," Tlali told local news channel eNCA, adding that meetings would take place over the weekend to try to resolve the issue.

He added that while SAA was not operating commercial flights, it has been doing repatriation flights for South Africans stuck overseas due to the pandemic and some charter flights.

Those services could be interrupted if SAA Technical does not restore its services.

Another SAA subsidiary, Mango, is currently operating domestic commercial flights.

Mango said it was currently operating as normal and that "sensitive discussions" were underway with SAA Technical to ensure services would not be disrupted.

SAA's administrators published a rescue plan in June that requires more than R10 billion ($584.16 million) to work.

The Department of Public Enterprises has said it is in the process of finalising funding and that the airline would not be liquidated.

"As matters stand, we are waiting to hear from the shareholder (government) to give us an indication as to when funds will be made available," Tlali said, adding funding was needed in the short term.

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