Bid to raise capital for troubled Comair

Published Jun 2, 2022

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The tourism sector needs to brace for yet another devastating blow as Comair suspended all British Airways and kulula.com flights on Tuesday.

The flights are operated by Comair under a licence agreement. British Airways and kulula.com ticket sales were also suspended with immediate effect pending the successful securing of additional funding.

The company’s business rescue practitioners (BRPS) said efforts to raise necessary capital was in progress.

“We deeply regret the inconvenience this suspension will cause our customers. We did everything we could to avoid it. Comair, the BRPs and the lenders are working all out to get the funding in place so that we can resume our normal flight schedule as soon as possible,” said Comair chief executive, Glenn Orsmond.

Tourism Minister Lindiwe Sisulu expressed concern over the matter.

She noted that it came shortly after the South African Civil Aviation Authority(SACAA) grounded Comair on March 13 over failure to show that their risk and safety management systems were up to standard.

Comair flight equates to approximately 40% of the country’s aviation capacity.

“This comes at a bad time as families are preparing for school holidays and some international holidaymakers are preparing to spend their summer holidays in South Africa. However, our main concern is the effect this will have on tourism,” Minister Sisulu said.

“Domestic travel contributed positively to demand in the Covid-19 period, driven by campaigns and pricing targeted for our domestic market. This was positive and helped create better understanding within the market and through this exposure propelled the market to diversify its offerings.

"Global tourism is rebounding despite lingering Covid restrictions and the effects of the conflict in Ukraine, but tourist arrival numbers are not back to pre-pandemic levels. The pace of recovery is slow and uneven across world regions, and this is due to varying degrees of mobility restrictions, vaccination rates, and traveller confidence," Sisulu said.

Cape Town mayco member for Economic Growth, James Vos said he hoped for a speedy resolution.

“Whenever we experience a disruption such as this one where a domestic carrier suddenly suspends all flights, it does have a knock-on effect on the many sectors closely linked to tourism. For example accommodation, transportation, and business gatherings. We rely heavily on airlift to ensure seamless travel between the major economic centres of the country. In this case, passengers and cargo are likewise negatively impacted,” said Vos.

Cape Times