It seems like any time a failing, government-supported airline plans to restructure, it’s mostly lipstick on a pig. I think of airlines like Air India, Aerolineas Argentinas, and of course, my beloved Alitalia as perfect examples. Shuffle the deck chairs, get new funding, and voila, you have a “new and improved” airline that will just face the same problems a couple years down the road. South African has generally fallen into that group, but a recent proposal makes it sound like the airline is getting serious. Don’t get too excited. It’s not the dramatic move that it appears to be, but it is still significant.
The full so-called “Business Rescue Plan” will be presented in full to creditors by the end of this month. But for now, we know what’s happening to the network. On the surface, it looks like a massive cut. Of the 22 African destinations South African serves from Johannesburg, 8 will lose service. That’s a lot, until you realize that this is more of a technicality.
Here’s a look at that African map.
Even though South African says it’s pulling out of eight airports, it’s really only walking away from two.
Over in West Africa, Abidjan is served as a tag on the end of the Jo’burg to Accra flight. That unsurprisingly gets cut since it was clearly already barely worth serving by the airline if it was being run as a tag. The other loser is Livingstone in Zambia. Livingstone is just across the border from Victoria Falls, a short 45 minute drive between airports. Going forward, South African will only serve Victoria Falls, and that makes sense. Livingstone became more popular as Zimbabwe became less and less stable. That concern has subsided over the years, and Victoria Falls remains the more popular destination.
All those other routes that are getting cut aren’t really going away. They will be served either by Mango, South African’s low cost carrier which also sells tickets under the SA code, or Airlink, an independent regional that also sells tickets under the SA code. In fact, after this announcement, Airlink swooped in to say it would take over the flights to Entebbe, Luanda, Ndola, and Port Elizabeth. (Port Elizabeth and the other domestic South African destinations are already served more frequently by Mango.)
Cape Town will also see reduced service, but think about it this way. On a random Monday this March, South African has 12 flights each way while Mango has 8. South African may cut back, but there’s nothing suggesting Mango won’t fill the void. This really looks like a shift from the high-cost South African platform to the lower cost platform of its affiliates. From a customer perspective, travelers can still book flights on “South African” to all of these places except for the two I mentioned.
The intercontinental network cuts, on the other hand, actually look more significant. Flights to four cities will be cut completely.
With the current downturn hitting China, it’s unsurprising to see Hong Kong and Guangzhou disappear. These are markets that are likely going to be hurting for some time, and South African can’t afford to hang on when it just needs to generate cash.
As for Munich, that’s an easy decision to make. South African already serves Frankfurt, and travelers can connect throughout the continent via Lufthansa. It’s hard to imagine how much value there is in serving both Frankfurt and Munich nonstop. Maybe Lufthansa will decide to pick this one up.
Lastly, Sao Paulo goes away. That always seemed like a thin route. There are few ways to get between Africa and South America, but there’s probably a good reason for that. The demand isn’t there.
This shift is undoubtedly being helped along by the aircraft issues at the airline. South African has no money, so it has struggled to refresh its fleet. It did somehow bring in 4 A350s this year which will fly flagship routes like New York and Frankfurt. But beyond those airplanes, it has an aging, inefficient widebody fleet.
The backbone of the long-haul fleet was a mix of A340-300s and A340-600s. Best I can tell, there are 5 or 6 -300s still flying around to places like Perth and Sao Paulo as well as African destinations. There are, I think, still 3 -600s flying, but they seem to be mostly isolated to random domestic routes. South African is trying to get out of this whole fleet one way or another.
That leaves the airline with what looks to be 5 operating A330-200s and another 5 A330-300s. Those seem to focus on flying to places like London, Munich, and Washington/Dulles via Accra in addition to intra-Africa flying.
By cutting all these international routes, I assume that means that the 4 A350s and some number of remaining A330s will be able to service the international network. Can’t afford more new airplanes? Great, just cut routes and get rid of the old ones.
We will learn more about South African’s plans when the full details are released, but as of now, this doesn’t seem like any sort of massive reorganization. It’s a pruning to get rid of the worst long-haul routes and the least-efficient airplanes while pushing off short-haul routes to lower-cost options. If it could get its labor house in order, then that might be enough. But labor relations always ends up being the problem in any government-carrier restructuring. Early indications are that South African doesn’t want to cut a lot of jobs, so that means we’ll just end up in the same place we are now a few years down the road.
