Aviation constraints a fly in the ointment

SA aviation is suffering from a severe lack of capacity after the demise of Comair in June. If this gap isn’t filled by the end of the year, airline ticket prices could rise substantially as the holiday season gets into full swing after two years in the doldrums.

But filling this gap will require a coherent and inclusive approach by all interested parties.

The cracks were already evident at Comair back in March, when the airline was grounded for a few days by the Civil Aviation Authority (CAA) on safety grounds. Nevertheless, when Comair finally went into liquidation in early June, it came as a nasty shock to the travelling public, and obviously also to the staff at Comair.

Thanks to SAA’s neardemise of the past few years, Comair’s market share had crept up gradually to 35%-40% by the time it collapsed. Including kulula.com and BAfranchised aircraft, Comair’s total fleet size at the time was 26 aircraft.

This is a huge void to fill, and to date nothing has happened on that front.

The market leader now by a wide margin is FlySafair with an estimated market share of about 60%, followed by Airlink on about 25%. Smaller players such as Lift, operating three Airbus A320s, Cemair which operates mainly turboprops and small jets and SAA’s seven Airbuses make up the balance.

Budget airline FlySafair is owned by Safair, which has been operating in the aviation leasing business in southern Africa for almost 60 years. FlySafair has been in existence since 2014 and has grown exponentially from two jetliners that year to 22 now.

While Airlink is much larger than FlySafair in terms of destination numbers and fleet size, it should be noted that Airlink’s aircraft are generally much smaller than FlySafair’s, as it tends to concentrate on those destinations that are historically not well-served by other airlines. Airlink has significant interline agreements with a number of foreign airlines as well as code-share agreements with Emirates and Qatar Airways.

BIG UNKNOWN

The big unknown now is what will happen to British Airways’ (BA’s) franchise agreement with Comair, which fell away on Comair’s liquidation. Comair liquidator Cloete Murray said he believes BA is looking to replace its franchise in SA with another operator. This makes sense from many perspectives.

BA has traditionally been the largest foreign carrier operating into and out of SA. Its franchise agreement with Comair, in existence since the late 1990s, was especially useful in allowing BA passengers from London to seamlessly travel on BA-painted aircraft to many destinations in southern Africa, including Cape Town, Durban and other coastal centres. At the time of its liquidation, Comair was flying 12 aircraft — mainly Boeing 737-800s — in BA livery under its franchise agreement with BA.

The only operator that could conceivably fit BA’s requirements is FlySafair but it is far from certain that FlySafair would want a full franchise agreement. A code-share or even a more basic interline agreement might suffice. Airlink already has code-share agreements with Emirates and Qatar and these might conflict with a BA code-share agreement and would certainly rule out a BA franchise agreement. Airlink has a basic interline agreement with BA.

But if BA is serious about reestablishing a franchise presence in SA, it would make sense to get things moving before the inbound tourist season starts in earnest in October. Once BA gets back into its normal scheduling with its Airbus A-380s, instead of the current Boeing -777s, an awful lot of extra passengers will be arriving from the UK and many will be wanting onward connections within SA.

That doesn’t give much time for any new partner to get a dedicated BA franchise fleet up and running. And then there would be the necessary CAA certification and approval for such a scheme of arrangement, which could take some time.

THE BIG UNKNOWN IS WHAT WILL HAPPEN TO BA’S FRANCHISE AGREEMENT WITH COMAIR