Fireside Chats | Why SAA is a strategic asset

[@thabangmahlangu1484]

I am re-educated, never had a perspective like this. This is some serious schooling on my part.

[@siphosethumartins6386]

Wow, This gentleman came with a different view point. Im impressed. Wow

[@Darkie015]

What a gentleman. He stuck to facts and avoided the political part of it.

[@ShakaZulu611]

I am absolutely blown away. The media shows us only what they want us to see. Thank you for the insight Mr Mqondisi Gumede. What an eye-opener!

[@chalahashange520]

SA media is lying to us

[@donaldmokgale3123]

Flipping insightful!!! Never looked at it this way at all! Thank you

[@TendaiSeanJoe]

We learn everyday! I am impressed. Thank you Mqondisi Gumede for this well researched presentation.

[@tshepomoletsane9764]

Certainly a fresh perspective around SAA nett gains/losses relative to the overall benefit.

[@zwelionline]

Very intelligent response to the question of why we should've continued spending on the SAA

[@tonydev100]

Makes a lot of sense, thanks. Sharing...

[@ValentineMasina]

Very enlightening indeed... Hope many people will understand this

[@chalahashange520]

Wow! Wow! I'm blown away. SA has been lying and misleading us. This video should be shared. Thank you guys

[@sihle1582]

This is NOT an alternative view, but clear evidence that, as the general public, we don't know see the full picture. Even if there are holes in Mqondisi's argument - which I doubt - he proved that we need to know more about how SOEs operate.

[@siyabongambatha7458]

i think most people need to see this .... its interesting and yet brings clarity to some problems we having as the society ...

[@mashabelamashataleisalamai245]

Very enlightening. Thanks

[@tdlamini7654]

As remarkable as this insight is, Covid 19 in 2020 was not expected. With the merging of the digital and real worlds in conjunction with a pandemic. FDI, tourism and cargo face extreme uncertainty in the short to medium term. Although in the long term the loss leading routes of SAA would suffer as private enterprise(s). If that is in fact the case being presented.

[@stanmaile9607]

Very informative more please. Just one small thing, please work on the sound, acoustically treat the room.

[@UnathiGX]

Informative information...&...Nice Rembrandt behind you!

[@edwinukama4830]

Many different perspectives that made me think. Don't buy into some of the ideas proposed at all. For one, what is the opportunity cost of bailing SAA out? Could we not carry the same "loss leading" mentality into education and health care rather and create other industries in the long term? Also how does one prove the correlation between SAA's routes and Chinese tourism investment? What if the drop was simply due to the introduction of a restrictive VISA regime, or indirect factor such as H1N1 bird flu or the performance of the Chinese property market and impact on household savings? I'm glad there are alternative views out there. Makes us all sharper and inclined not to simply go with the narrative. However, if it was up to me, SAA would have been sold a long time ago.

[@smiloification]

makes perfect sense

[@boyzeebeats]

That's like saying: "I started this company so that I can employ as many people as possible and pay them exorbitant salaries which they spend in the economy. The higher my loss the better it is for the economy because it means more people are spending money in the economy".

[@boyzeebeats]

Another thing. If loss is positively correlated to benefit to the economy. What happens in the event of reduced passenger numbers?? If you fly less people then tourism benefit will be reduced and therefore no benefit at all based on your argument.

[@spksiba2993]

Thanks for laying it out. Anyone who doesn't see this logic in this information is of low intelligence. Can you please explain the fishing and forestry industry bra Vusi. I'm interested on your perspectives.

[@RG-GTS]

Sure, you have a point: We should bring more tourists to South Africa, since we benefit hugely from that. However, does that excuse the inefficiencies and attempt at robbery that the primary school teacher boss-lady was perpetrating for her masters? Lets agree that we need a airtravel budget as part of our annual national budget, but then pay some of that money not just to SAA, but also to Safair, Comair or anyone else that bring people to South Africa.

[@RG-GTS]

Mxm? Could you translate please?

[@thabomonethi7426]

I knew that someone is going to try to obscure this point buy shifting the focus. It's really annoying. Media Tactics

[@N22za]

This is a rather complicated issue .Maybe SAA should pay even more attention to their cost structure and make an effort to trace where expenditure is coming from so that they can define where improvements are needed to decrease costs and increase profits. Maybe one of the issues involve cost control.

[@Kamzen]

Very interesting... Can you upload his presentation?

[@ICKnowledgeBureau]

Hi there. The presentation will be shared soon our website. www.iconoclasts.co.za

[@TarcisiousKuateRasegojwa]

Now this is what I call insight

[@Mpho503]

who's this guy?! lol he's thorough

[@vusimabona3153]

So how then does SAA get to a point where it is profitable in the SAA to Beijing scenario? knowing very well that their beneficial in terms of the tourism industry.

[@thapelosebola5562]

Instead of making huge losses why can't they just break even? i'm sure they will still be ahead of their competitors if they do that; in terms of attracting customers..

[@nyahwe]

Breaking Even means cutting out many routes, which means less tourists, which means less money for Hotels, Beach houses, transport services etc. The idea is to look at the bigger picture, SAA helps R40bn into the fiscus (tourism) but that money does not get to be accounted on SAA's books. SAA goes on to make a loss of R3bn and closes routes, next year SAA helps R25bn into the fiscus (due to route cuts) and SAA break-even. Overall loss to SA is 40-25=15, so to save 3bn the economy sacrificed 15bn. Is it not dumb?

[@Mazwi]

Wow

[@owenwolf5000]

Still no reason SAA should be making a loss. Look at Ethiopian Airways by example. If SAA was really keen in tourism they would have international flights from Cape Town, or Durban what about Durban - Mumbai. They would be aggressively competing on the domestic market not cancelling destinations like PE, East London. Look at the staff compliment how many hundred of staff per aircraft. So my take this is a load of bull, SAA has become a a looting tool for the politicians.

[@sbunqayi7747]

I'm am not sure if you listened that well before your response, the gentleman is stating the fact that these routes are cancelled because of the idea that they're running a loss if you don't look beyond an SAA financial statement. Now i don't see what is the point of your argument

[@marccombrink]

So according to him, a politician who knows nothing about aviation but runs an airline into the ground is right, but one who knows nothing about aviation and says that an airline shouldn't be run into the ground is wrong. He's contradictory, but he does inadvertently make the case that ignorant people, particularly politicians, should not be running companies in fields they know nothing of, which is why the companies they run fail; they don't know what they are doing. The irony of this position of his, is that it contradicts everything else he said, which means he is likely a shill, who excuses corruption in a very eloquent manner.

[@vutivishivambu8914]

He never said any politician is running aviation to the ground, he said the losses are profitable and even if the CEO was not a politician, international routes would still cost us. Stop making it about politics.

[@marccombrink]

Seems you missed my point: he said people ignorant of the industry shouldn't get involved, therefore by his own assertion, the people running SAA should not be there because they know nothing of aviation. Is Dudu Myeni an expert on the business of aviation... Aside from that, I'd like to see the data (not opinion) that correlates SAA's losses to profitability anywhere else. Oh wait, alternative facts...

[@dorrienvenables3057]

Bizarre, this is the most amount of nonsense I've ever heard.

[@flyvhembeaviationinafrican2193]

I am not sure whether you do not want believe this because you are clouded with the past or you do not understand. The apartheid goverment used this brilliantly including skilling almost 90% of the aviation staff in all SA private airline whom went through SAA. Secondly a brilliant example is Emirates and Ethiad who financially support their airlines to bring in tourist to the countries while pumping money to airline ask american airlines the confirm the undercover subsidies.

[@dorrienvenables3057]

"clouded with the past" - straight to the identity politics hey. State owned airlines are not efficient because they do not operate in a proper free market space when they can fall back on bailouts. How is it that a privately owned airline such as Kulula can operate at a profit yet we are expected to believe that SAA cannot at least be fiscally neutral. SAA has lost far to much of its market share to ever be economically viable (besides having very limited assets) and is an archaic beast which needs to be liquidated, just as the Swiss with Swissair.

[@flyvhembeaviationinafrican2193]

The same strategy of developing the country that was used during pre democracy should be used but for all South African instead. The example of successful SA privately owned airline is the proof that properly run SOC are required to facilitate the economic and transport development. All or majority of routes and aviation infrastructure are due to SAA including the development of world class pilots and aviation personnel. The majority of previously excluded people who are now professionals internationally and locally in different industries including aviation. When your house is leaking you do not demolition it but you repair the leaking roof or replace the roof. SAA needs to fix the problems it has and continue to transform the economic and continue to develop South African skills.

[@vutivishivambu8914]

He said local routes are the most profitable and Kulula mostly focus on those. SAA make more losses from international routes although that profits the country in a way.

[@RG-GTS]

Yes, Emirates and Ethiad do that, but it is planned in advance and executed as a strategy. This is not what is happening here. The core point (that we should plan to subsidize), it correct and valid. That is it retro-actively applies to SAA's poor operations is not valid. Only if this is done formally and above board, as a deliberate act of Parliament, then it would be valid and executed correctly. So let's move beyond the pettiness that pops up here and there in these responses and address the matter in the correct and legal way.