Open more airports, routes if SA airlines are to survive – industry body

The chances of South Africa’s airlines surviving the
devastating impact of the coronavirus flight bans and their ability to
contribute to economic repair in the country, will depend on how soon more
airports and routes can open, says Chris Zweigenthal, CEO of the Airlines
Association of Southern Africa.

AASA’s members include all the domestic airlines in South
Africa, most airlines in the SADC region and the Indian Ocean islands, and many
of the region’s major airports.

All flights were grounded when the national lockdown started
at the end of March. AASA sees the phased resumption of South African domestic
passenger air services, although on a limited basis, as a positive move.

Under lockdown level 3 restrictions, which came into force on
Monday, local airlines are permitted to offer flights for business travellers
on the main trunk routes linking Johannesburg – both OR Tambo and Lanseria
airports – Cape Town and Durban. Operations will take place under stringent health
and biosecurity conditions.

The next phase, government has said, will depend on the success
of the first.

Capital outlays

“The start-up phase will be difficult for all carriers
as it involves significant financial outlays before any revenues have been
generated. Most carriers worldwide, including South Africa, only had about two
months of cash reserves in late March 2020, when the travel restrictions were
imposed, bringing the industry to a sudden halt,” says Zweigenthal.

He says the protocols, including screening of people
entering, being put in place by the four airports as well as airlines will be
monitored to see how it works and what needs to be changed.

“We want to make sure the main airports are working
well and then move on to the next phase of trying to open more airports in the
country. For that reason, there will be an assessment in startup phase of the
main four airports to see how it is working and what can be tweaked. Then we
can start adding more airports and routes,” says Zweigenthal.

“It is crucial that the new systems are given
appropriate capacity by Port Health so they can be stress-tested as quickly and
rigorously as possible. Only then will the reconnection of other inland and
coastal cities be phased in. The sooner this occurs, the better as survival of
airlines and their ability to support the repair of the local and national
economies are entirely dependent on this.”

Intra-Africa regional and inter-continental long-haul
flights will only resume when there is mutual agreement between nations to
re-open their borders for passenger traffic other than ad hoc repatriation
charter flights.

“AASA will continue to work with the authorities and
the tourism sector to support the re-introduction of these services,” says
Zweigenthal.

“AASA is supporting the call for the South African
government to specifically direct financial aid to the air transport sector –
on an ownership-agnostic basis – as all airlines and associated service
providers are vital to the country’s economic revival. Without an efficient air
transport system, South Africa’s economic recovery will be prolonged and
painful.”

Airports Company South Africa (ACSA) announced on Tuesday
that it has put in place extensive physical measures, standard operating
procedures and staff training necessary to give effect to the lockdown Level 3
regulations announced by the Minister of Transport Fikile Mbalula.

ACSA spokesperson Gopolang Peme says the measures
implemented are comprehensive and cover every aspect of the passenger’s journey
from an airport entrance to boarding an aircraft.

Significant changes

Passengers will find that the airport environment has
changed considerably, says Peme. In particular, the new procedures take time
and passengers should arrive at the airport at least two hours before the
scheduled departure.

IATA said on Wednesday that African airlines’ air traffic
sank 98.7{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} in April, nearly twice as bad as the 49.8{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} demand drop in March.
Capacity contracted 87.7{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}, and the load factor dived 65.3 percentage points to
just 7.7{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} of seats filled – the lowest among all regions in the world.

IATA found that the average aid in Africa is around 1{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} ($0.8
billion) of the 2019 revenues of airlines on the continent compared to about
25{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} of their 2019 revenues received in aid by North American airlines, 15{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}
received by European airlines and 10{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} of revenues received by airlines in the
Asia-Pacific region.

Relief mechanisms at government’s disposal include deferrals
and waivers of taxes and statutory charges as well as user fees for airports,
air navigation and weather services, loans and loan guarantees to enable the
raising of debt in the capital markets, direct aid with wage subsidies and cash
injections to help industry players cover unavoidable costs during the restart
phase.

South African airlines have taken a varied approach to the
restart, depending on their capacity and resources. Privately-owned regional
airline Airlink will launch a limited scheduled domestic air service from
Monday 8 June, with flights on the Johannesburg-Cape Town and Johannesburg-Durban
trunk routes.

Low-cost airline FlySafair has announced that it plans to
offer between 20 and 26 flights per day from mid-June.

JSE-listed Comair, which operates Kulula.com and British
Airways locally, is in business rescue, and has said it does not foresee
operating flights before October or November. Similarly, state-owned airline
South African Airways is also in business rescue and only flying ad hoc
repatriation and cargo flights. It is unclear whether it will start regular
domestic flights, as a business rescue plan for the airline is expected to be
submitted by 8 June.

State-owned regional airline SA Express is already in
provisional liquidation and its provisional liquidator has indicated that he
does not foresee it resuming flights in its current situation.

The International Air Transport Association (IATA) urged
governments on Monday to quickly implement the International Civil Aviation
Organization’s (ICAO’s) global guidelines for restoring air connectivity.

The ICAO Council has approved a comprehensive framework of
risk-based temporary measures for air transport operations during the Covid-19
crisis. It proposes a phased approach to restarting aviation and identifies a
set of generally applicable risk-based measures.

These measures include physical distancing to the extent
feasible; wearing of face masks by passengers and aviation workers; routine
sanitation and disinfection; health screening; contact tracing; passenger
health declaration forms; and testing, if and when real-time, rapid and
reliable testing becomes available.