Cape Town - The good news this week is that FlySafair, a new low-cost airline started by long-established charter airline Safair, has met the requirement for a domestic airline, that it is 75 percent-owned by South Africans resident in this country. FlySafair will be able to go ahead with plans to fly the Cape Town to Joburg route with lower fares than those being charged at present.
The bad news is that, because its ownership has changed, it has to reapply for an operating licence. This may take some time and FlySafair may not come into service in time for Christmas.
Safair announced this week that it had launched an employee share scheme – claimed to be the largest of any airline in this country – which, together with Safair chief executive Dave Andrew and financial director Elmar Conradie, who are both South Africans living in this country, will control FlySafair.
An earlier attempt to start the new airline was frustrated when an interdict was obtained against it in the Gauteng High Court on the grounds that although one of the three controlling directors, Hugh Flynn, was born and brought up in South Africa, he has dual Irish and South African nationality and, despite the fact that he owns property in this country, lives and works in Ireland. His shareholding in FlySafair has now been distributed among the members of the employee-share scheme.
Air fares on the Cape Town to Joburg route have rocketed since low-cost airline 1Time went out of business in December last year.
The route is flown only by Comair, SAA and their low-cost divisions, kulula.com and Mango.
1Time’s original founders, Glenn Orsmond and Rodney James have started a new airline, Skywise, with the intention of flying the Cape Town to Joburg route.
They have already leased new generation aircraft, but have waited a long time for an operating licence to be issued.
Cape Town’s tourism industry has been worried by SAA’s decision to withdrew its service between Buenos Aires and Joburg on the grounds that it is losing R50-million a year. Tourism from Argentina has been growing steadily for the past four years.
Alan Winde, the Western Cape MEC for Finance, Economic Development and Tourism, has joined Argentinian tour operators in appealing to SAA to reconsider its decision.
But Wally Gaynor, chief executive of Club Travel, says there is no need to worry.
He says SAA’s losses on the route are not only because of rising costs and the weak rand but because many South American tourists are already saving money by coming to this country with Middle Eastern airlines Emirates, Etihad and Qatar Airways.
The cheaper fares, combined with the comfort of the modern aircraft, compensate for the longer travelling time.
He says some Argentinians also come here on SAA’s flights from Brazil’s commercial capital. Sao Paulo.
In addition to this, there are rumours that Aerolinas Argentinas and LAM are considering flying here and that a charter service may be started for the summer season.
Gaynor says many South Africans also fly to Argentina and neighbouring Chile for business as well as leisure.
Sun International, which has developed a hotel and casino in Santiago, Chile, is one of a number of South African companies with investments in South America. - Sunday Argus