Ethiopian Airlines may become a saviour for African carriers and Comair slips into business rescue process
Ethiopian Airlines is prepared to come to the rescue of stricken carriers around Africa, even as the continent’s biggest airline deals with its own mounting losses and grounded planes due to the Covid-19 pandemic.
The airline is in talks with the government of Mauritius about the revival of Air Mauritius, which was put into administration last month, Ethiopian CEO Tewolde GebreMariam said. And while there are no negotiations currently taking place with South Africa, GebreMariam would be open to a conversation about that country’s bankrupt national airline.
Air Mauritius has joined the insolvency league in April last week as the company’s board of directors announced that the carrier would be put into voluntary administration. The airline which completed 50 years in 2017, hosted the African Airlines Association’s (AFRAA) 8th Aviation Stakeholder’s Convention and 51st AFRAA annual general assembly (AGA) & summit in 2019.
“The Mauritian government is thinking of restarting that business with Ethiopian Airlines,” he said. “We are at the initial point of the discussion to see what kind of partnership or joint venture it will be.”
The global airline industry has been thrown into a historic crisis by the coronavirus outbreak, which has led to the grounding of almost all aircraft as governments close borders. African carriers have not been spared, with Ethiopian set to lose almost $1 billion in ticket sales over its fiscal year to end June.
South African Airways (SAA) is out of cash and in the middle of a tug of war between government, unions, and administrators over its future.
Ethiopian last held discussions with South Africa’s government about SAA in early January, the CEO said, and the carrier would be willing to take part in a proposed revival of the national airline.
SAA’s administrators have given labor groups until Friday to agree to severance packages for the near 5,000-strong workforce, but Public Enterprise Minister Pravin Gordhan has said he’s still exploring funding options that may involve private entities.
SAA was compelled to ground and offered compensation deals to all staff from the end of April after administrators – Les Matuson and Sizwe Dongwana concluded that a successful turnaround is now unlikely. The basic value of compensation will be one-month pay per year of service and will depend on the successful disposal of assets such as real estate, rotables, and trade debts.
