Don't copy US, Europe - give SA customers what they want, say airline CEOs | Fin24
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Don't copy US, Europe - give SA customers what they want, say airline CEOs

Oct 25 2019 19:15
Carin Smith

Instead of trying to make African airlines sustainable by trying to copy what was done in Europe and the US in the past to liberate their airspace, it might be time to rather focus on what consumers actually want.

This is according to Wrenelle Stander, joint CEO of Comair, who was speaking at the annual general meeting of the Airline Association of Southern Africa (AASA) being hosted by Air Austral on the Indian Ocean island of Reunion.

Lower prices, more connectivity

"Consumers want lower prices and greater connectivity and we should provide a model which provides that to them.

Comair operates its own low-cost airline as well as British Airways under a licence agreement.

"Airlines cannot operate in a vacuum. A lot of cooperation is also needed between airport providers and airlines, especially as we move forward on customer elements like self-service," she said.

She said Comair embraces competition and airspace liberalisation.

'Compete aggressively'

"We compete aggressively in the full-service and low cost carrier market," she said.

She admitted that in the low-cost market, Flysafair has given "a run for its money".

"But that is the nature of business. Aviation is like any other business. The Single African Air Transport Market (SAATM) should be about customer needs and recognising that airlines are businesses, which should be allowed to compete and have the right professionals to run them. To me SAATM is not a silver bullet, but it will contribute to ensuring better aviation services in Africa."

Elmar Conradie, CEO of low-cost airline Flysafair, said their business model is to keep things as simple as possible and keep costs down. He agreed that it is about what customers want.

"There is a role for every type of carrier to play – low-cost airlines, full service airlines and those with hybrid models," he commented.

He noted that customers want to pay as little as possible.

"Low-cost airlines normally have a specific market type. We are not feeder airlines or connectors. We, therefore, rely on the middle class, so we depend on a growing middle class and growing economy. The same would go for the potential success of low-cost airlines in the rest of Africa. They would need a growing middle class to be sustainable."

As for implementing SAATM, he said the best way to do it would be to start bit by bit with individual agreements.

He also emphasised that there must be a reason for people to use specific airline routes.

"Let the market do what the market needs to do without interference. Some people said the greater number of direct international flights to Cape Town will impact Flysafair, but we found that, from there, visitors also fly to other destinations in SA and the southern African region, and that is where our domestic flights play a role again."

Fin24 was a guest of AASA at its AGM.

aasa  |  flysafair  |  comair  |  aviation industry  |  tourism


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