Rising oil price likely to cause an increase in airfares: SAA

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The South African Airways (SAA) CEO, Thomas Kgokolo, says the rising oil prices aggravated by Russia’s invasion of Ukraine is likely to cause an increase in airfares.

SAA has just reintroduced its route between Johannesburg and Durban after a two-year break.

Flights on this route were halted because of SAA being placed under business rescue, as well as the impact of the global COVID-19 pandemic.

The airline resumed operations four months ago by reintroducing flights between Johannesburg and Cape Town.

Addressing the media in Durban as they welcomed the first flight between Durban and Johannesburg, Kgokolo said the rising oil prices might pose a threat to SAA’s operations.

“Our aircrafts run on fuel, so it’s something we need to look at. We know for sure that our cost base is going to increase. So it will require us as management through the board as well to look at our cost structure to make sure that we run sufficient frequencies, making sure that if a particular frequency doesn’t give us the right numbers from a revenue.”

“To mitigate the high costs of oil price, we are going to adjust that to ensure that we look at sustainable frequencies that we are going to use. It is going to be [a] problem for us. We are hoping that the market will normalise, and we will see the prices gradually declining as well. But [it] is something that will keep us awake for the next 6 months or so,” explains Kgokolo.

Possible job cuts at SAA

On Tuesday, members of the South African Cabin Crew Association (SACCA) and the National Union of Metalworkers of South Africa (NUMSA) at SAA picketed at the offices of the Department of Public Enterprises (DPE).

The two unions say the protest is against the looming dismissals of 225 workers, and the continuation of corruption and mismanagement at SAA among other grievances.

In the video below, unions react to possible job cuts: