South African Airways, South African Express Airways and South African Airlink are holding exploratory talks for the consolidation of their services and possible merger of the two feeder airlines.
“Boni Dibate, CEO of South African Express Airways, Roger Foster, CEO of South African Airlink, myself and our teams, have met on several occasions to discuss how we can consolidate services and reduce costs,” said SAA President and CEO,“André Viljoen.
“The consolidation of the airline markets serving within the same markets is a trend that started a while ago. The consolidation has become even more imperative since September 11 when two jetliners smashed into the World Trade Centre, causing a ripple effect in the airline industry that had seen job losses, increases in insurance cost and reduced demand,” Viljoen said.
South African Express Airways is a wholly owned subsidiary of Transnet, which also owns South African Airways. SAA owns 10 percent of South African Airlink, with the rest held by private investors.
Both airlines provide an extensive feeder network for SAA to almost anywhere in South Africa.
“Our relationship with these two regional airlines has always been one of close co-operations and symbiosis within the SAA alliance. We foresee that any future synergy between us will also be an amiable and mutually satisfactory one,” Viljoen said.
The Alliance provides numerous benefits for local travellers and overseas visitors alike. Not only do all three airlines qualify passengers for Voyager benefits, but flight schedules are coordinated to provide a seamless service which include ticketing, check-in procedures, mutual branding and flight codes.
Ernst & Young have been appointed to act as advisors to the three airlines through out this project. The first step will be to investigate the feasibility of bringing the two regional feeder airlines together and to examine the business case of the prospective combined entity.
“We expect to complete this process which also includes consultations with the Department of Public Enterprises, the Competition Commission and other stakeholders, by March 2002,” Viljoen said.