South African discount airline Intensive Air has been placed into provisional liquidation after grounding flights between Johannesburg and Cape Town this month.
Fuel giant Total South Africa last week applied to the Johannesburg Supreme Court for the airline's liquidation after Intensive Air defaulted on payments totalling R3.7m ($330,000). The court has given the airline until 21 May to come up with a rescue plan or face liquidation. Chief executive and owner Kobus Louw blamed the closure on escalating aircraft insurance costs after 11 September, which more than doubled costs from R5 million last year to R12 million this year.
Meanwhile, Absa Bank and other financial institutions are trying to find potential buyers to revitalise the airline. Passengers left stranded due to the collapse are unlikely to receive compensation because, unknown to the South African transport ministry, Intensive Air had failed to provide a legally required passenger protection plan.
Intensive Air operated two daily services between Johannesburg and Cape Town with three ex-Scandinavian Airlines 75-seat Fokker F28s. The carrier also operated charters for Air Botswana.
Source: Flight International
