The Air Transport Licensing Council (ASLC) has suspended the license of Mango Airlines for up to two years, which could increase competition in the sector and reduce the cost of flying in the long term.
Talking to CapeTalkaviation analyst Phutega Mahapele said that based on the needs and considerations of the country and its airline, the board suspended Mango’s license as it was deemed useless.
According to Mohapele, the South African aviation sector requires an airline to use its license while operating. Mango, however, has been discontinued for more than a year, making way for new market entries.
Mango has had no planes in the sky since the end of July 2021, when the company went into business rescue. Mango has been fragile, as has the rest of South Africa’s aviation industry, which has collapsed due to the pandemic.
Mahapele said the suspension is not an outright recall and the airline can reinstate it if it can prove to the council that it has the necessary plan to maintain its routes over a two-year period.
This follows from the message CH-Aviation In an update to the airline’s creditors, business savior Sif Son said an unnamed consortium had submitted “adequate and satisfactory evidence” of funding to the airline’s management.
CH-Aviation said the consortium was given until Wednesday, August 10 to provide a bank guarantee in favor of Mango. However, such evidence has not yet been presented.
Good news for consumers?
Despite the suspension of Mango’s licenses, Mojapele said it could bring good news for consumers.
“The interest in the industry is very high and we will see changes very soon; we will see prices come down because there will be a lot of competition in the market.”
“It’s good for our economy; it is good for other players who want to come in and take advantage of what is already available in the market,” Mahapele said.
At the end of June, Statistics South Africa showed that in terms of consumer price inflation, air passenger traffic grew by 45.9% between May 2021 and May 2022.
In accordance with economists, Ticket prices were expected to rise following the closure of Comair in June, as the airline, which served domestic flights for British Airways and low-cost carrier Kulula, was responsible for 40% of the country’s domestic airline capacity.
The Bureau of Economic Research (BER) said that in the short term consumers would experience a bit of air traffic capacity, but in the long term other operators would fill the gap left by Comair.
Mahapele, from an insider’s point of view, said he has heard of new players taking a serious interest in South Africa’s domestic airspace; however, he said he could not reveal names.
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