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[LISTEN] Comair could have Avoided Collapse had Management been Proactive

Jun 15, 2022

Umm Muhammed Umar

Airline operator, Comair, has been placed in provisional liquidation by the South Gauteng High Court, in Johannesburg. Comair, which operated kulula.com and British Airways (SA), grounded all flights on June 1st after it could not fulfil its financial obligations, such as aircraft storage, maintenance, and insurance costs.  Radio Islam spoke to Cosatu’s parliamentary co-ordinator, Matthew Parks.

Parks said that the operator had no option but to close its doors, which was a huge blow. He said the decision saw more than 1200 direct jobs affected. He added that it would have a huge impact on the broader domestic travel and tourism industry as well, because Comair provided about 40% of domestic flights. He said that there was “the possibility of run-on increases in prices for other tickets, because other airlines might seek to take advantage of it.” Further, the closure follows Mango Airlines having closed, so the blow is significant.

Parks said that he wished that there had been an alternate option for Comair. He said that the company had done well for many years, and had been operating in different forms for decades. It was hoped there would be a new company which would come on board to take it over, in order to save as many jobs as possible, and to revive one of South Africa’s key industries.

Airline workers have been trained in a particular field, which means that their options are narrow when searching for prospective employment. Parks said it was also going to be tough for them as, “the new owners will come in at a position of strength – that can dictate terms, and workers would be desperate.” He added, “And of course, economic contexts where we have an unemployment rate of 45% – these are workers who must take care of their families.” According to Parks many aviation workers have lost their pensions, their homes, and have had to take their children out of school. In the last two years. Parks said it was critical to find a new owner for Comair quickly, in order to save the employee’s jobs, and to save them from falling into poverty.

Regarding any effort by Cosatu to save Comair, Parks said what should have taken place, did not. He said that the scenario would have been different had things been done proactively and on time, because there then would have been alternatives, instead of simply collapsing the airline. He blamed Comair’s management for allowing the company to collapse, and, as a consequence, plunging workers into unemployment and poverty. Parks said that the unions had been really frustrated as they had been invited to make inputs, which they had, but that the company had still been allowed to collapse. He said, “And if you think if they had actually done this thing proactively, timeously, we could have avoided this; we could have come up with a better plan. We could have gone into a proactive intervention package, which could have looked at getting additional shareholders on board to look at how to reduce the debt and so forth. But, unfortunately, the company’s management didn’t do that.”

 

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