South Africa

Comair CEO denies flight ticket sale was a way to raise capital

Comair made the shock announcement on Wednesday morning that it was suspending (once again) all British Airways and Kulula flights, which it operates in South Africa.

The news followed an all-day sale of massively discounted flights.

Customers feel betrayed and have been venting their frustration on social media.

How do you have sale and enter into BR on the same day? #Kulula #Comair

— Jacques Botha (@JBZA) June 1, 2022

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Comair suspends all Kulula, British Airways flights over funding issues

Comair was trying to gather enough revenue with 30% discount – expert

Bruce Whitfield tries to get answers from Glenn Orsmond, CEO of Comair.

Orsmond says the decision to ground planes was to enable them to secure "additional funding".

It really is unfortunate… the most important thing is that we left our passengers stranded today… We've been in business 74 years and this hasn't happened before, in terms of leaving them stranded for the reasons as have happened.

Glenn Orsmond, CEO – Comair

Orsmond walks Whitfield through what transpired on Tuesday night to prompt the suspension of flights.

He emphasizes that the decision was taken "late last night", which affected operations from Wednesday morning.

We've obviously been working on this for a while, and last night we were faced with a crunch where we had a liquidity crisis in order to continue operations… Working with the business rescue practitioners (BRPs) we took the decision that we had to suspend operations.

Glenn Orsmond, CEO – Comair

Orsmond denies that Tuesday's flight sale was a capital raising drive.

"We suspended sales immediately when we became aware that we would have a problem with our liquidity this morning."

But was it not deceitful to their customers, Whitfield insists on knowing.

The Comair CEO says the airline only receives the cash for ticket sales once they've provided the service.

We actually have sales throughout the year… and they are planned weekly in advance.

Glenn Orsmond, CEO – Comair

We only receive the proceeds from ticket sales when we provide the service. There is no way this can be viewed as a way to try and bring in cash because there's a crunch at the end. We receive the cash when we provide the service.

Glenn Orsmond, CEO – Comair

It is really incorrect to try and create the story that we raised the sale because we're short of cash.

Glenn Orsmond, CEO – Comair

Orsmond discusses the cumulative impact of the Covid pandemic, the airline's temporary suspensions and the rocketing oil price.

Right now Comair is focusing on working to minimise disruption and best accommodate passengers, he says.

Passengers booked on BA flights are being accommodated on other airlines where possible.

Regarding passenger refunds, he says there will be a process to follow.

"The cash is safe and the cash will be refunded".

For more on plans to get Comair operations airborne again, listen to the audio below:

This article first appeared on CapeTalk : Comair CEO denies flight ticket sale was a way to raise capital

Artmotion S.Africa

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