South African Airways (SAA) is reviewing its entire route network, in particular its long-haul routes, with a view to "pulling the plug" on unprofitable ones.
This is the latest in a series of turnaround plans for the embattled national carrier, which reported a loss of R1.25 billion last year and has been hit by strike action in recent weeks.
SAA has recently attempted to grow its intra-African network on high yield routes but has also launched new direct services to new trade partners, such as China.
Gigaba said the overhaul would also see regional carrier SA Express and low-cost carrier Mango rolled into a new airline group, forming part of a new holding company reporting to the Department of Public Enterprises (DPE).
SAA CEO Monwabisi Kalawe said: "Management has clearly identified loss-making routes. We have asked Department for Public Enterprises to identify those that are crucial to growth of the economy. Once these have been identified, we'll pull the plug on those not deemed crucial and that are making losses," he said.
SAA added that ‘turnaround office’ wiould be established to lead the LTTS.
Opposition leaders in South Africa were quick to slam the plan for the tax-payer funded airline.
The Democratic Alliance’s (DA) shadow minister of public enterprises Natasha Michael reportedly said the plan “does not instill confidence that the public carrier will be stabilised. It appears that SAA will continue flying around in circles with no end in sight”.
“Nine turnaround strategies and R16 billion later the airline continues to yield lower profits than its global competitors,” she added.
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