South African Airway’s (SAA) low-cost airline Mango on Wednesday dismissed claims that it was losing R3-million a week.
”I am amazed at the continued pursuit of an argument that is based purely on fiction,” said Mango CEO Nico Bezuidenhout in a statement.
”It seems as if numbers are drawn out of a hat and issued along with other, tired allegations in a desperate bid to gain publicity.”
He said since the carrier’s launch on November 15, Mango had sold more than 350 000 confirmed tickets.
Erik Venter, joint CEO of Comair, based his R3-million per week loss calculations on an all-inclusive cost of R60 000 per flight between Johannesburg and Cape Town.
”With their flights only 50% full, their revenue per flight won’t even cover their fuel and maintenance costs.”
He questioned how much SAA’s attempt to ”nationalise” the local aviation industry was ultimately going to cost South African taxpayers.
Venter said Comair had not received an undertaking from SAA, as requested 11 days ago, not to put any further capital into Mango following the R100-million shareholder’s loan.
”Even though Comair was able to run kulula.com profitably from day one, Mango has indicated that it expects a two-year grace period in which to turn a profit. Clearly there is no accountability — I don’t think my colleague [kulula head] Gidon Novick and I would keep our jobs for too long if we operated like that.”
Bezuidenhout reiterated that Mango was financed by a R100-million market-priced and repayable shareholders’ loan, and that it leased its four Boeing 737-800 aircraft from SAA at market-related rates. SAA Technical maintained Mango’s aircraft, also at market-related rates, he said.
”Mango has a strong business case; we have modelled our business plan on global best practice and we are able to offer sustainable lower airfares as a result.”
Responding to Comair’s claims that its flights were only half full, Bezuidenhout said during its first day of operation, Mango only released 50% of its available capacity for sale to ensure first day administrative processes ran smoothly.
”Mango presently operates on an average load factor of between 75% and 80%,” he said.
According to Venter Mango had not wanted to put its ”newly trained” staff under too much pressure on the first day.
”We’re not sure if is this is a joke or not but our kulula.com staff were prepared … to serve full planeloads of customers from day one.” — Sapa