South African Airways' new US chief executive is promising a complete overhaul and believes alliances and privatisation will have to wait until the airline is in better shape.
Coleman Andrews, former CEO of World Airways, has been given a four-year contract with a mandate to restore the South African carrier to health. He has already saved R11 million (US$2 million) by improving purchasing methods.
'To turn this airline around we have to attack every element of cost and revenue, which will include a serious review of destinations, eliminating those that are not viable and increasing the frequencies of those that are, as well as doing a complete re-evaluation of the fleet,' says Andrews.
'It is crazy to have three different aircraft types with different makes of engines and configurations, all serving the domestic market,' Andrews says. 'The international fleet is not much better. I want simplicity and standardisation.'
It is not clear whether SAA will reactivate the stalled Boeing 777 order, which has cost $6 million in deposits. 'What we want is the best deal we can get for the airline. The Asian crisis has seen many aircraft orders cancelled and there are bargains to be had from this. But certainly we need a younger fleet'.
The CEO suggests that SAA will need more time to take on a foreign equity partner. 'I'm more concerned about performance than dates,' he states; the official deadline for naming a partner is 31 October.
With a return to profitability, talks could be held from a position of strength, Andrews states. 'We want top dollar for a stake in our operation and we are not going to get it when potential partners have to ask when we'll be profitable.'
Source: Airline Business
