The new lost-cost airline Mango on Thursday denied claims by competitor kulula.com that it was using taxpayers’ money from South African Airways (SAA), the airline’s spokesperson said.
”The beginning and the end of the relationship between SAA and Mango was the R100-million loan,” said Hein Kaiser. ”That loan obviously has to be paid back and we have to provide a return on investment, but there’s no way that it will affect the taxpayers’ pocket.”
Kaiser said Mango has a strong business model and was quite clear, from the beginning, about the fact that it will not use taxpayers’ money.
He was reacting to a statement by kulula.com on Wednesday in which the airline’s chief executive said that Mango should stop using taxpayers’ money from SAA.
Gidon Novick said: ”We have asked SAA for their commitment to limit their exposure to the initial R100-million that has been sunk into the project to prevent further damage to free enterprise at taxpayers’ expense.”
SAA loaned its subsidiary Mango R100-million to get started.
Novick added: ”We look forward to SAA confirming to us and all South Africans that not a single rand further will be taken from public coffers to support Mango.”
Kaiser said he will respond to Novick’s claims and statements in good spirit, but added that it is becoming tiresome. ”It’s becoming a bit of a bored claim and holds absolutely no substance whatsoever.”
Beyond the R100-million loan, taxpayers’ will not be affected, said Kaiser.
He said the consumer is, in fact, winning, as Mango’s entry into the aviation market means healthy competition.
”Other airlines suddenly lowered their prices while claiming that low prices were not sustainable.
”The Mango business model is vastly different from what South African aviation has ever seen before, so we are able to offer lower prices,” he said.
SAA spokesperson Jacqui O’Sullivan said SAA chief executive Khaya Ngqula has received a letter from Novick and will respond soon.
Meanwhile, responding to kulula.com’s suggestions that some of Mango’s first flights were running less than half full, Kaiser said the airline has sold more than more than 100 000 tickets, so there is no question of it running half empty.
”Quite honestly, within the first 10 days of trading, we sold in excess of about 150 000 tickets, bought and paid for by South Africans.” — Sapa