South Africa’s embattled national carrier South African Airways (SAA) has run out of money and is effectively bankrupt, according to a cashflow statement seen by the country’s MPs. This development has raised concerns that the airline will be unable to pay salaries in the near future.
On an operational level the airline in July spent $42m more than came in and it’s predicted that the situation will worsen in the coming months. They are not officially bankrupt yet as that involves a court process.
SAA says it expects to improve its finances by October, but that depends on getting yet another bailout from the government – this time to the tune of $60m. The airline also says it has a turnaround plan, but analysts calculate that in order to avoid being grounded, the airline needs a cash injection close to a billion dollars over the next three years.
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