The man with a master’s degree in social policy seems to be quite vocal Comair group chief executive officer, Erik Venter, said the state-owned company, Mango – little brother of state funded and battling South African Airways (SAA) – was the reason behind the downfall of the low-cost 1Time. On Friday 1Time’s time ran out when it was announced that it had applied for liquidation and that all of its operations had been grounded, leaving thousands of passengers across the country stranded.
Gigaba said: “The allegations made by Mr Venter, CEO of Comair Ltd, including citing Mango as the cause of 1Time’s demise, with over 1,000 employees as collateral damage, are serious in nature and designed to cause commercial harm to Mango as an entity, and by default the State, with an apparent expectation of impunity to recourse.”
The minister described the airline’s exit as “regrettable”, given the partnership between public and private entities to create jobs and economic growth. “Mango remains, as from day one, an entity operating independently from its shareholder South African Airways; [it was] created to have the lowest cost base of any South African carrier and comparable to leading low cost operators globally.
“We appreciate Mr Venter’s classification of Mango as an efficient airline that serves to lower the cost of ticket prices in the hands of the public being the exact mandate of the entity (sic). The ‘sic’ means we used the sentence exactly like we received it from the learned minister, but that we really don’t understand the jargon. Do you?
“The systematic attempt, however, at disaggregation of competitively sensitive information such as cost composition, beyond what Comair is willing to disclose itself to its own shareholders, comes across as hypocritical and self-serving (sic),” said Gigaba.
Mango, the minister said, was in “a cash-positive, neutral movement position” and was viewed as a model of stability in a sector facing continuous economic challenges in a contracting market.
“Mango did not benefit from any capitalisation or guarantee issued in favour of its parent company, SAA. Mango has been substantially cash-positive since inception and no expectations exist that the entity would require any form of related shareholder assistance in the years to come,” said Gigaba.
But Venter says Mango operated a “less efficient” fleet which made the closure of low-cost airline 1time inevitable. If it wasn’t for Mango, 1Time would have made sufficient profit to upgrade its fleet and survive.
The news also prompted Natasha Michael, the DA’s public enterprises spokeswoman, to call on the national carrier SAA to assist stranded 1time passengers. She described 1time’s closure as a “blow” to consumers, and said it was a consequence of the “anti-competitive” behaviour of SAA, SA Express and Mango.
“As the long-time beneficiary of generous government support, SAA should do everything it can to assist 1time passengers, and we strongly encourage them to offer discounted flight options to stranded 1time travellers,” Michael said.
Last month the government agreed to bail SAA out of some serious financial dwang with a bailout to the tune of R5billion. Tax payers will foot the bill. SAA, like Woolworths SA, is fundamentally a racist company. By its own admission it states – on its website – that it only wants to train black pilots.
