SA flights are getting cheaper, as airlines accuse each other of undercutting | Business

Some airline's have opted for "overly optimistic and aggressive growth strategies" over the past 12 months.But some in the industry are accusing others of uncompetitive pricing.

Some airlines say there is an oversupply of seats at the moment. South African Airways estimates that the overall capacity among domestic airlines in SA increased by about 25% between June to August of this year, compared to last year. "Passenger volumes in SA have been flat over the last 12 months at about 80% of pre-Covid-19 levels. The issue we have is that the dominant airlines are still adding flights and seat capacity. By doing so, they drive down the price of air tickets to unsustainably low levels," says Jonathan Ayache, CEO of LIFT.

"The impact of this behaviour has been to drive down pricing of tickets to unsustainably low levels. In the short term this may seem like a good thing, especially for the public. It's actually very detrimental in the medium to long term as we learned less than 12 months ago after Comair's exit," says Ayache.

"That's great for consumers. Great deals to be had in low season, but it won't be that way in high season of course - it can't," he says. "Airlines will start to feel their operating cost per seat. This is about how the business is fundamentally set up. When the prices you can get are low, you become far more aware of your costs and if they've not been managed, a squeeze will set in."

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