SAA Targets Long-Term Sustainability, Questions Over Financial Future

South African Airways’ (SAA) newly appointed acting CEO, Matshela Seshibe, says the airline remains focused on building a financially sustainable business despite ongoing concerns about its long-term viability and whether it may require future government support.

When SAA resumed operations following business rescue, the South African government committed to providing no further bailouts to the state-owned carrier.

Asked whether he remained confident that SAA would not require another bailout, Seshibe told Aviation Week, “Our focus remains firmly on building a financially sustainable airline.”

SAA’s own board has acknowledged “material uncertainties” regarding the airline’s ability to operate as a going concern, admitting that “historical operating profits and operating cash flows remain below sustainable levels.”

On defining sustainability, Seshibe says: “Profitability is an important component of sustainability, but ultimately our objective is to build an airline that can create enduring value, rather than focusing solely on short-term financial outcomes.”

Addressing industry challenges, he adds: “The aviation sector globally faces constrained aircraft availability, rising operational costs and reduced consumer spending. Growth for growth’s sake is not our objective. We are focused on disciplined expansion, ensuring that every fleet and network decision supports long-term sustainability.”

Airfares have shown a steep increase in response to the spike in fuel prices. Regarding fare impact on demand, Seshibe says: “Like all airlines, we continuously monitor demand and adjust capacity to align supply with market demand.”

While SAA was grounded by the business rescue process, northern hemisphere airlines moved aggressively into the routes SAA once dominated, such as the “Springbok Service” between London and Johannesburg. Regarding restoring former routes, Seshibe says, “A key to future growth will be alliances. We will partner with airlines with integrated systems and shared values. SAA’s membership of Star Alliance is an excellent base for further codesharing and network expansion.”