Africa: Airline Liquidations affecting South African Aviation sector as fewer carriers struggle to meet domestic demand amid capacity shortage

domestic airline market

With fewer aircraft operating in the aviation sector, South Africa’s domestic airline market is grappling with a capacity shortage that has left local airlines struggling to meet demand.

According to aerotime.aero, the liquidation of domestic airlines such as Comair, SA Express and Kulula.com has left a significant void in the sector, said CEO of Airports Company South Africa (ACSA), Mpumi Mpofu, according to local South African media, Eyewitness News (EWN).

Alongside high jet fuel prices, the capacity shortfall has resulted in limited seats and higher ticket prices, Mpofu said.

“So, when people book, they find the aircraft full. If we had had more, basically those places would have been taken up,” she added.

“I know a lot of people who took decisions not to fly because they were not sure whether capacity was going to be a constraint or not,” Mpofu said.
Airlines turn to leasing to meet capacity demand.

However, Mpofu revealed that South Africa’s domestic airlines are exploring aircraft leasing options to meet capacity demand, despite the process being “complex”.

READ: Aviation: South Africa Airways says subsidiary carrier, Mango Airlines no longer viable

“It [leasing] doesn’t happen at [the] touch of a button but increasingly, the airlines we are working with are increasing that aircraft capacity on a month-to-month basis,” Mpofu said.
Which domestic airlines were liquidated in South Africa in 2022?

Comair
Comair, which operated British Airways and Kukula.com flights, filed a court application on June 9, 2022, to convert its business rescue proceedings into liquidation proceedings after failing to secure funding to continue operations.
The airline faced a turbulent two-year period having entered voluntary business rescue on May 5, 2020, as a safeguard for the company and its stakeholders.

Comair exited business rescue and resumed operations in December 2021. However, the airline’s Air Operator Certificate (AOC) was suspended shortly afterwards on March 13, 2022, due to an investigation to determine the cause of a “spate of occurrences” that affected a concerning number of flights operated by Kulula.com and BA Comair.

Comair’s AOC was reinstated on March 16, 2022. However, three months later the airline filed for liquidation proceedings.
Comair was estimated to serve around 40% of the South African market, with a fleet of 12 Boeing 737 aircraft.

Mango Airlines
Mango Airlines was a South Africa-based low-cost carrier and a subsidiary of South African Airways. The airline operated domestic routes within South Africa and one regional route to Zanzibar, Kenya, before grounding its flights in April 2021 and entering business rescue in July 2021.

In early August 2022, the Air Services Licensing Council, a regulatory body in South Africa, suspended Mango Airline’s licenses for a period of two years under the council’s Air Services Licensing Act.

South African Express
South African Express, also known as SA Express, operated as a state-owned airline based in South Africa. The airline also operated with a strategic alliance with South African Airways.
The carrier entered provisional liquidation in April 2020, after a failed business rescue attempt.

However, in September 2022 the South African High Court placed the airline into final liquidation.
The airline last operated before its provisional liquidation in April 2020.

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