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Argentina complains South African Airways decision to cut the Buenos Aires route

Thursday, November 7th 2013 - 07:57 UTC
Full article 37 comments
The Beijing route which loses money is being kept for “strategic and development reasons”, said SAA The Beijing route which loses money is being kept for “strategic and development reasons”, said SAA

Argentina's ambassador to South Africa, Carlos Sersale di Cerisano, has criticized South African Airways’ (SAA’s) move to end its service to Buenos Aires as a “political decision” not based on commercial criteria. SAA spokesman Tlali Tlali said the airline was cutting long-haul routes from its network as part of a turnaround strategy to restore profitability. Cutting the route between Argentina and South Africa had to be seen in that context.

“Projections are that the termination will take effect in the new calendar year,” Mr Tlali said in an e-mail. “SAA identified two international destinations, namely Beijing and Buenos Aires, to cease operating in.

”Decisions of this nature are dependent on the concurrence of the shareholder. We have canvassed the shareholder views in both cases and were successful in the case of Buenos Aires only. This means we will continue to fly to Beijing“.

South Africa is part of BRICS, the political and trade bloc comprising Brazil, Russia, India and China and South Africa, with the most modest position in the bloc, and is eager to cement its place in the grouping.

”Beijing and São Paulo are destinations to two of the Brics member states ,“ Mr Tlali said. ”Even more, China is the number one trade partner for South Africa. We will provide a comprehensive account as to why we pull out of certain routes once our consultations have been finalized .”

South African Department of Public Enterprises spokesman Mayihlome Tshwete said the decision to cut the Buenos Aires route had been a commercial decision as the route was losing about R50m (approx 5m dollars) a year. The department supported the move.

The Beijing route, which loses about R300m (30m dollars), was being kept for “strategic and development reasons”, Mr Tshwete said.

SAA was retaining the Brazil route because it had larger volumes and was a bigger hub for traffic from the South American continent. ”Sao Paulo is more a strategic route because it’s a bigger hub (than Buenos Aires),” Mr Tshwete said.

Ambassador Sersale di Cerisano said when comparing the commercial performance of the Buenos Aires-to-Johannesburg route and the Sao Paulo-to-Johannesburg one, it was clear that both were losing money. But the Argentine route lost less. The Buenos Aires route could make money if operated with more fuel-efficient aircraft.
 

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  • Teaboy2

    So Argentina expects them to invest and buy newer airplanes that are more fuel efficient so they can continue to provide a service to Argentina! And if they are losing money already, then how can they be expected to purchases new planes. Hmm so why doesn't Argentina's own airline take over the route instead then?!

    As for calling in a political decision, that's just stupid, its clear the China is a much bigger economy with more people able to afford to travel to south Africa then in Argentina. So the decision was economical not political and the only ones Politicising this is Argentina, but no surprise there i guess!

    Nov 07th, 2013 - 09:23 am 0
  • HansNiesund

    I imagine they're got the hump that SA clearly considers Brazil of greater importance than Argentina. But looking on the bright side, perhaps it means there's another hangar to steal.

    Nov 07th, 2013 - 09:30 am 0
  • Conqueror

    Shorter distance between Johannesburg and Sao Paulo than it is between Johannesburg and Buenos Aires. And who, in their right mind, wants to go to argieland anyway?

    Nov 07th, 2013 - 10:34 am 0
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