Highly indebted regional airline SA Express on Wednesday announced it was suspending operations with immediate effect.
SAX has accumulated losses estimated at R1.2bn in the past decade.
“In light of adverse recent developments, including the impact of the Covid-19 pandemic, SA Express announces that it will suspend operations from March 18 2020, until further notice,” the airline said in a statement.
Passengers will be accommodated on alternative flights.
All non-critical SA Express staff will be placed on compulsory leave.
“The airline will utilise this period to review its current network and streamline operations for improved efficiency,” it added.
In the February budget, finance minister Tito Mboweni said SA would have to decide if it still wanted to continue owning it, “given that it has a limited role in the local aviation market”.
In September 2019, SAX received a government bailout of R300m to ease its operational and financial challenges.
In February, the airline became the second state-owned airline after SAA to go into business rescue after an order of the high court.
Business Day reported that Johannesburg high court judge EF Dippenaar ruled that the airline be placed in business rescue for failing to settle its debt of R11m to global logistics firm Ziegler SA.
The contract with Ziegler was an agreement to provide a range of services, including cargo management, customs clearing and inventory, and supply chain management. The airline argued that there was no need to place it into business rescue because the contract with Ziegler, which was signed by former CEO Inathi Ntshanga in 2017, was irregularly obtained and raised red flags when reviewed by new management.
On its website, SAX said its route network included Bloemfontein, Cape Town, Durban, East London, Gaborone, Hoedspruit, Johannesburg, Kimberley, Lubumbashi, Mthatha, Port Elizabeth and Walvis Bay.
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