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5 questions: Mango's acting CEO on SA aviation and Mango's route ahead

Nov 18 2018 08:57
Carin Smith

The financial state of South Africa's state-owned airlines has been a hot topic in recent years.

Among these state-owned airlines, Mango is regarded as always having been financially strong with a positive cash flow. Marelize Labuschagne, new acting CEO of Mango, says the airline delivered record profits in the 2017/2018 financial year.

She says this year Mango will again be profitable, though margins are under pressure, especially due to the increased price of Brent Crude as well as the decline in the value of the rand.

Labuschagne is a qualified chartered accountant with a collective 17 years' experience in the aviation industry.

Fin24: How do you see the current state of the SA aviation industry?

Marelize Labuschagne (ML): The increased costs of airline fuel and the deterioration in the rand, coupled with the downturn in the economy, does bring challenges for the aviation industry. There has been a decrease in overall capacity, though the increase in demand is lower than the decrease in capacity.

This has resulted in higher overall load factors, but at similar fares than the prior year. Everyone is currently just trying to defend their market share. Ultimately, we are trying to grow ours.

Fin24: How do you see the current state of the low-cost airline industry in SA?

ML: With the downturn in the economy, demand shifts more to low-cost airlines, away from full service carriers. In line with the market trend, there is pressure on margins and focus is being placed on the control of expenses and retention of market share.

Positive cash flow will be the key to the survival of the low-cost carrier market. As the domestic demand has not grown, investment in alternative markets will be important. Focus on service delivery and providing value for money is important for market share retention.

Fin24: What will be your strategy at Mango and why?

ML: Mango's plans are based on a five-year corporate plan, of which implementation started a year ago.

Currently the focus will be on implementation of the five-year strategy, and on execution. It does not help to start re-planning every time a new CEO is appointed and then the execution phase is left behind.

I have been part of the development of the corporate plan and, therefore, it is a plan that I buy into and believe in. So, there is no need for me to change the direction of the company, as it is on the right path.

Fin24: What sets Mango apart from its competitors?

ML: We offer an affordable, end-to-end quality flying experience. A great experience and a smart choice. We strive to offer more convenience, more choice, more flexibility and more value for our guests.

We are service and value-driven. We provide more booking options, more legroom, more luggage, more value adds, more partners, more offers.

We also strive to reach our digital audience through our interactive website, our mobile app and our social media platforms, that have over a million followers collectively.

Fin24: What is Mango's strategy towards expanding or reducing routes?

ML: In the past financial year, Mango increased its footprint by 30%. We have grown the fleet from four aircraft, since the start of Mango, to a current fleet of 14 aircraft.

Due to current market density in the domestic market, there are no further opportunities for Mango at this stage, but we are looking at various possibilities on a regional level.

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mango airline  |  airlines  |  aviation
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