Comair and Mango Go Head to Head

A fight is brewing between the remaining two competitors in the South African budget airline space. Against the background of the recent filing for liquidation by 1Time and the debate that has ensued over the role of state-subsidised Mango, Comair Limited has highlighted that Mango, as a separate legal entity from SAA and a state-owned enterprise, is legally required to publish its financial statements, which it allegedly has not done since its inception six years ago.
 Comair operates kulula.com and British Airways in the local market, and says that it believes that the funding of Mango with tax payers money partly contributed to the failure of 1Time. Mango CEO Nico Bezuidenhout has responded by stating that Mango will only reveal its financials, if kulula does so first. CEO of Comair, Erik Venter responded that Comair, as a listed company on the JSE, releases detailed financial results every six months in accordance with the Companies Act, the rules of the JSE and based on International Financial Reporting Standards.
 “Comair has an obligation to reveal its results as a listed company,” said Venter. “Kulula.com is merely a brand of Comair Limited – it is not a separate company from Comair. Although Mango is a subsidiary of SAA, it is a separate company and needs to report as such.” No doubt, this is not the last we are going to hear of South Africa’s two budget airlines going head to head, as the competition whittles away and the fight over the remaining piece of the pie intensifies.

Comair Take on 1Time Liquidation

South African aviation company Comair has responded to the news that budget airline 1Time filed for liquidation on Friday.

In the process, Comair pointed out that 10 of the 11 independent, private airlines launched in South Africa since deregulation in 1991, have failed, leaving only kulula.com and British Airways, which are both operated by Comair.

“Due to the less efficient fleet it operated, the ultimate closure of 1Time was inevitable,” said Erik Venter, CEO of Comair.

“However, we are certain that in the absence of state-subsidised Mango, 1Time would have made adequate profits to upgrade its fleet and be sustainable over the long term.

Based on the previously released financial statements of SAA, and recent parliamentary comments, Mango made a loss of half a billion rand since its 2006 launch, due to undercutting the viability of the private low cost carriers.” 1Time announced on Friday that it had applied for business liquidation, and that all of its flights had been grounded.

The firm had about R320-million in short-term debt and had been in negotiations with creditors since March.

1time Cuts Mombasa Route

 Troubled South African low-cost airline, 1time, has announced that it will halt operations between Johannesburg and Mombasa from 17 September.
 "While the debt relief process will allow 1time to continue operating while we resolve the outstanding issues and prepare to emerge as a healthier company, part of the process will be to strengthen our profitable routes and to terminate non-profitmaking destinations," said CEO, Blacky Komani.
Earlier in the week, 1Time Holdings filed for business rescue. The airline's board said it required business rescue because it was "financially distressed". The firm has about R320-million in short-term debt and has been in negotiations with creditors since March.
1Time's shares have fallen 91% over the past two years, from about 155c a share to close at 14c a share on Tuesday. In April, the company reported a R157-million loss.
 Earlier this year, another South African low-cost airline, Velvet Sky, went into liquidation after failing to convince a court that it was a candidate for business rescue.

1time Withdraws From Lanseria

South African budget operator 1time Airline has announced that it has withdrawn all of its flights to and from Lanseria International Airport in Johannesburg. 1time Airline CEO, Blacky Komani said that the retraction of the Lanseria routes was motivated by a decision to optimise its overall operations. “We have taken the decision to consolidate all our local and regional flights from O.R. Tambo International Airport and concentrate on our African projects that are currently underway. Pending seasonal demand, and commercial viability of the airport, we may look at reviewing our Lanseria services in the future.”

1time To Expand To Lanseria

1time Airline is set to begin operating from Lanseria International Airport in March 2012. Flights offered from the airport will include two daily return flights to Durban and Cape Town, catering mainly for the increased business activity and holiday market in March and April.

 “Lanseria Airport is a convenient option for passengers staying or operating in the Northern or North-Western suburbs of Johannesburg, as it provides a great alternative to O.R. Tambo International. The airport also presents a great opportunity to significantly increase our passenger share”, said 1time’s CEO, Rodney James.

The new routes from Lanseria International Airport represent 1time’s first venture to a so-called “secondary airport”, which is consistent with the trend of low-cost carriers the world over. For more information, visit www.1time.co.za.