After several bailouts, the Chief Executive Officer of South African Airways is begging to get another $400 million lifeline to save the national carrier.
Fondly known as SAA, the airline has been bedeviled with management and financial crisis that threatened its going concern.
Quoted by Reuters News, Vuyani Jarana, Chief Executive of SAA told parliament in April that the firm needed the capital injection “now”.
“Government has committed to inject another 5 billion rand into SAA. Part of that 5 billion rand we will repay some of the creditors, suppliers, then the balance will support us for working capital until around October/November,” Jarana told Reuters in an interview.
Jarana said he will strive to see how to further plead with SAA’s lenders pending when the bailout will be released.
“If Treasury needs a certain period of time to do this, lets say up to September, between now and then, we are negotiating with lenders to give us a bridging facility on the back of that commitment,” he said.
Reuters News quoted the Treasury spokesperson who said the bailout will follow its normal budgetary process, which entails seeking cabinet approval.
“The outcome of this process is expected to be finalised in time for the 2018 MTBPS (Medium Term Budget Policy Statement),” the Treasury said.
It seems the bailout would not suffice to save SAA. Jarana hinted on possible job cuts as soon as the company gets its books sorted.
“Whether it’s pilots, cabin crew, administration, we are going to rationalise the workforce. It’s an unavoidable thing. We have been talking to trade unions about how we work together,” Jarana said.
This might surely be met with labour resistance in a country known for strong labour union activities.
“The first priority for me is job preservation, how do you find alternative jobs for people as a starting point before you go into the hard issues of retrenchments.”