Comair can smooth Mango turbulence
Comair, the JSE-listed owner of kulula.com, revealed the route it has mapped out to cruise through the turbulence created by Mango's entry into the budget airfare market.
"Our goal is to replace the kulula.com fleet by the end of the calendar year," Comair said in its financial results for the year ended in June.
"The replacement Boeing 737-400s are not only more efficient to operate, but also offer a much better customer experience. Furthermore, our new kulula.com fleet will continue to ensure that our cost per seat remains the lowest in the industry. We will also start benefiting from the many efficiencies associated with a single aircraft type fleet," the company said.
There are three airlines duelling in South Africa's low-cost market: private sector kulula.com and 1Time, and state-owned Mango.
1Time raised capital through an initial public offering on AltX in August, positioning itself to follow kulula.com's suite in upgrading its fleet.
Meanwhile, Mango's long-term chances in this dog fight look slim considering the financial woes of its parent company, South African Airways.
Mango pre-empted Comair's results with a press release claiming it has captured 10percent of the low-cost airfare market.
Comair then reported its turnover grew 12percent to R2,2billion.
The airline managed to widen its profit margin despite hefty fuel price increases, and will pay a dividend of 9c a share, up from 7c last year.