- 09 Dec 2021
- Felipe Reisch
- AvBuyer Africa Articles
Despite increased private jet demand, bureaucracy could hinder Business Aviation’s long-term growth in South Africa. Felipe Reisch speaks to some industry experts based in the region to find out why…Back to Articles
South Africa has historically been considered the largest Business Aviation market in Africa, both in regards to the number of operations, and the available aircraft. Although that is not expected to change in the short-term, there are other countries experiencing growth – a win for the entire BizAv ecosystem within the continent.
Nevertheless, while regions in northern Africa expect an influx of newer private aircraft, South Africa is seeing a number of owners selling their jets for reasons “ranging from uncertainty created by ambiguous government policy, to concern for personal safety after recent local unrest”, according to Justin Reeves, CEO of Comair Flight Services.
The unrest he refers to has caused many high net-worth individuals to emigrate to safer countries. For those remaining, the depreciating local currency has allowed many aircraft owners to potentially sell at a profit as the Rand recently reached a ZAR 16.00/1 USD conversion rate.
“Frustrations caused by bureaucracy, and a lack of effective management of administrative processes within our local Civil Aviation Authority makes operating and importing aircraft, and adding them to an AOC an extremely frustrating and tedious process, and it certainly doesn’t do anything to attract local buyers,” Reeves explains.
Rebecca Johnson, President for Europe, the Middle East, and Africa (EMEA) for JetHQ, believes the exit of a number of business jets from the country is likely to be “due to the political instability” as well as continued Covid-19 variants presenting challenges in the country.
“When the country stabilizes there will be new opportunity for Business Aviation to grow within the country,” Johnson assures, adding that at this time there are still some sales opportunities for aircraft based there.
Added Industry Value
Despite the sales of aircraft out of the region, Africa’s top market has also been seeing some positive trends, regarding demand and orders.
Private charter operator Comair, based at Lanseria International Airport, Johannesburg, has seen an increase in demand for business aircraft across the whole of Africa. The company is undertaking plenty of positioning flights from its base in order to pick-up and drop-off clients from various southern, central, and east African nations.
And Reeves says his company is seeing increased utilization of some of the older business aircraft that were not as popular pre-Covid. “We have fortunately also seen a number of new aircraft orders being placed, and we’re looking forward to receiving a number of new aircraft under management in the coming years,” he reveals.
“The biggest challenge is servicing the immediate demand, as many aircraft have already left our shores, and the new deliveries will take months or perhaps years to [arrive and] replace [the out-going jets], as new owners await delivery of their new aircraft.”
The Pandemic Shifts
Going by the impact of Covid-19 on Business Aviation elsewhere on the planet, it is no surprise that private aviation’s image received a boost in South Africa, too.
Once considered a realistic means for transportation by only a few wealthy fliers, the renewed perception of safety and, ultimately, a controlled travel experience has had a positive impact.
“The negative perception created around BizAv since the 2008 financial crisis has turned,” Reeves says. “Companies and individuals are once again seeing the true value.”
“Pandemic shifts are increasing the charter business, fractional ownership, and are heavily increasing the aircraft sales business worldwide,” Johnson agrees.
As the world slowly returns to normal again, the need for in-person meetings might help increase the investment in South Africa’s Business Aviation industry, while renewed global interest naturally creates opportunities for aircraft management companies, charter operators globally, and FBOs.
Under this scenario, diversification has been key for Comair. “We are fortunately quite well-positioned, in that we’ve established a presence in corporate, large groups and cargo operations,” Reeves explains, “so as various types of lockdowns and red-lists hit us over the past two years, we would tend to see cargo and corporate flights increase, even as leisure travel decreased, and as the airlines paused operating certain routes.”
Future Challenges and Opportunities
Besides logistical supply chain issues that have affected almost every industry worldwide to some degree, the challenges in Africa remain much the same as they were in the past.
As Reeves explains, there has been much talk, and little action on opening Africa’s skies. Talks date back to the Yamoussoukro Decision of 1999, a treaty that allowed for open skies among most African countries, and more recently the formation of the Single African Air Transport Market (SAATM).
“Africa seems to love bureaucracy,” Reeves laments. “I don’t know if in my lifetime we’ll see a day when the archaic system of emailing each of the 52 African states that you wish to overfly, or land in, to ask for permission to operate in their airspace, finally becomes a thing of the past.”
Namibia, for example, does not allow passengers to be collected there if an operator didn’t first take them into the country. In other words, anyone arriving in Namibia via a scheduled airline flight who later wishes to fly to South Africa via a private charter, may not call upon a South African charter operator to collect them.
Though only in force since 2020, Reeves says Namibia’s policy has had a very negative impact on the high-end tourism sector, with Comair and several other operators recommending leisure travel clients avoid tourism flights to Namibia, and explore other Southern African destinations instead, as they are more open to General and Business Aviation.
Reeves also highlights the slow processing times in South Africa as a hindrance to operations, specifying “waiting many months, and in some cases over a year, to add a number of new aircraft onto our AOC Operations Specification” has a detrimental impact on business.
Private demand for Business Aviation in South Africa is increasing, which bodes well for the entire industry’s ecosystem. But if long-term growth is to continue, leading the continent to compete with other larger BizAv markets around the world, the bureaucracy must be tackled, and the resulting incentives must be increased.
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