Strong brand will turn around SAA Cargo’s position

Justice Luthuli, acting general manager of South African Airways Cargo

With a strong and recognisable brand, South African Airways will use this to its advantage to turn around its financial position.

Justice Luthuli, acting general manager of South African Airways Cargo tells Air Cargo Week that the flag carrier of South Africa is a well-known brand, and also benefits from its track records in service, reliability and safety.

He adds that the airline is also known for its compliance with all cargo and aviation regulatory requirements, standards and regulations.

He says: “Part of SAA’s plans is to leverage its strong brand to turn around its financial position.”

So far in 2019, Luthuli says international stations have performed well despite the economic downturn, and the reduction in London flights impacting transhipments from Africa to the UK. Regional and domestic services were restrained by a reduction of capacity.

He says: “In the regional markets SAA has reduced the number of destinations as a measure to optimise its capacity.

In the domestic market, the cancellation of operations on the loss-making routes of the overnight freighter services plus the reduction of the line flights negatively impacted performance.”

Year-to-date performance has improved due to strong performance on the Johannesburg – Cape Town – Johannesburg overnight network.

Re-introducing overnight freighter services for Durban, Port Elizabeth and East London will also improve momentum, Luthuli says.

On intra-African services, Lusaka, Nairobi, Lilongwe, Accra and Lagos remain the most active. Internationally, trade routes to Germany, UK, Hong Kong, USA and Sao Paulo have all shown strong load factors.

Luthuli says: “Supplementary services in the form of POCs and interlining have been used to provide for European and Asian markets such as the Benelux countries and Asian islands.”

Luthuli is confident about South Africa’s future. Citing LPI ratings, he says South Africa is ranked the third most competitive market for logistics performance among upper-middle-income economies after Thailand and China.

The rating measures logistics competence, tracking and tracing, infrastructure, customs, timelines and international shipments.

He says: “Over and above this, the investment in infrastructure is key and SA has done very well in respect of road, rail, air infrastructure developments however there is room for improvement.”

Luthuli admits there will always be challenges, saying: “The transport logistics sector is faced with challenges such as infrastructure, high logistics costs, and unskilled workforce. For the sector to thrive these must be addressed to avoid adverse effects on businesses that rely heavily on cargo logistics to succeed.”