South African Airways (SAA) says that its continuously deferred order for Boeing 777s is about to have a financial impact on the airline, while the delay is forcing the carrier to acquire interim aircraft capacity.
Deliveries of four 777s had originally been due to start in 1997, but these have been delayed by politics surrounding the engine selection, which is thought to be dependent on offsets. It seems that this has resulted in a delay until 1998 being agreed, but SAA's chief executive, Mike Myburg, declines to comment on when the first 777 could arrive. SAA sources suggest late 1998 at the earliest.
Myburg also denies suggestions that penalty clauses in the contract have already been triggered, but explains that other financial issues are taking effect. "We only expected the first 777s at the beginning of 1998, and so no penalties have been raised by Boeing yet. However, the [price] escalation clause is coming into operation and will have a financial impact.," he says.
The deferral of the 777s has forced SAA to re-activate one of its old Boeing 747SPs, while it expects to finalise the acquisition of a third Boeing 767-200ER by mid-month. This will probably be one of the two ex-Egyptair, Pratt & Whitney JT9D-7R4-powered 767s traded to United Technologies. SAA had also planned to introduce another Boeing 747-300 in August, but this has been postponed.
Meanwhile, the recent call by Stella Sigcau, Minister for Public Enterprises, that SAA should find a strategic partner before the end of the year looks unlikely to be met. Myburg says that until negotiations with unions are concluded, there will be no green light to proceed. "Certain carriers have indicated they would be interested," he says. British Airways is understood to be one of them. SAA already has an alliance with Lufthansa.
Source: Flight International