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- May 11, 2013
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Biashara ya ndege ni mtihani, sio shughuli ya kuingia kichwa kichwa, lazima upige mahesabu ya mbali, mashirika mengi yanapumulia mashini huku mengine yakiangukia pua, sio ukinunua ndege chache unapata mzuka, bila mikakati zitaishia kupiga ruti za daladala huku ukiegesha kadhaa.
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State-owned South African Airlines is facing turbulent times, announcing coming layoffs while requesting an infusion of funds from the state. Their financial situation, however, could reach beyond the troubled company to impact political candidates and the country’s credit score. Their online breadcrumbs leave behind clues as to their strategy for rising out of debt.
Following the breadcrumbs
South African Airways announced this week that it would be laying off 118 members of its catering unit.
Layoffs, while major indicators of financial trouble, also point to areas where a company is deciding to focus – or relinquish – its resources. It’s an indicator of how the brand is approaching a strategy to rid itself of debt.
The announcement follows a series of varying attempts to remain solvent, from offering up surplus cabin and crew members to other global carriers, to getting rid of underperforming routes, to moving aircraft to its low cost arm Mango, to government bailouts and continued appeals to the National Treasury as a shareholder for cash injections.
In May, the company was able to secure $400M in cash from the South African government following a plea from SAA Chief Executive Vuyani Jarana when he mentioned layoffs on their staff of 10,000 would be “inevitable.”
In his latest statement, Jarana claims further cuts will be ‘unavoidable.’ Reuters reports that “two sources familiar with his plan said the state-owned carrier was likely to cut between 1,000 and 1,500 people via a combination of layoffs and voluntary redundancies to bring its employee-per-aircraft ratio in line with regional competitors.”
The brand announced potential bankruptcy back in 2017, when Parliament received reports of the firm “hemorrhaging cash” and in dire need of a government bailout. From rife corruption, to poorly negotiated contracts, to underpaid and often striking staff, a number of factors have contributed to the airline’s demise, and its inability to break even.
Customers are taking note, with satisfaction levels for the airline falling blow its competitors in May following Jarana’s plea. Meanwhile, Ethiopian Airlines, who has overtaken SAA as the biggest airline by revenue and profit, remains favorable.
outsideinsight.com
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State-owned South African Airlines is facing turbulent times, announcing coming layoffs while requesting an infusion of funds from the state. Their financial situation, however, could reach beyond the troubled company to impact political candidates and the country’s credit score. Their online breadcrumbs leave behind clues as to their strategy for rising out of debt.
Following the breadcrumbs
South African Airways announced this week that it would be laying off 118 members of its catering unit.
Layoffs, while major indicators of financial trouble, also point to areas where a company is deciding to focus – or relinquish – its resources. It’s an indicator of how the brand is approaching a strategy to rid itself of debt.
The announcement follows a series of varying attempts to remain solvent, from offering up surplus cabin and crew members to other global carriers, to getting rid of underperforming routes, to moving aircraft to its low cost arm Mango, to government bailouts and continued appeals to the National Treasury as a shareholder for cash injections.
In May, the company was able to secure $400M in cash from the South African government following a plea from SAA Chief Executive Vuyani Jarana when he mentioned layoffs on their staff of 10,000 would be “inevitable.”
In his latest statement, Jarana claims further cuts will be ‘unavoidable.’ Reuters reports that “two sources familiar with his plan said the state-owned carrier was likely to cut between 1,000 and 1,500 people via a combination of layoffs and voluntary redundancies to bring its employee-per-aircraft ratio in line with regional competitors.”
The brand announced potential bankruptcy back in 2017, when Parliament received reports of the firm “hemorrhaging cash” and in dire need of a government bailout. From rife corruption, to poorly negotiated contracts, to underpaid and often striking staff, a number of factors have contributed to the airline’s demise, and its inability to break even.
Customers are taking note, with satisfaction levels for the airline falling blow its competitors in May following Jarana’s plea. Meanwhile, Ethiopian Airlines, who has overtaken SAA as the biggest airline by revenue and profit, remains favorable.
South African Airways in Trouble - Outside Insight
South African Airways, one of the largest in Africa announces major layoffs while competitor Ethiopian Airways steps up to the plate
outsideinsight.com
