in Air Transport

Novick's plan for new South African carrier boosted by Global deal

Posted 14 September 2020 · Add Comment

ACMI Charter specialist Global Aviation has teamed up with former Kulula Air boss Gidon Novick to help bring his plan for a new domestic airline to the South African market.

The Johannesburg- based operator will bring two of its A320s to the venture according to reports from the signing of an agreement with Novick on Friday.
“It’s effectively Global’s operation; it’s their AOC, AMO and aircraft, but we have a joint venture arrangement in terms of our involvement, bringing a lot of airline experience to support the branding, sales and marketing,” Novick was quoted as saying.. He said the team combined industry experience with fresh thinkers from the technology and hospitality sectors, including former Uber Africa Executive, Jonathan Ayache.
In an interview with African Aerospace last month Novick said he believed there was room in the market for a focused low-cost domestic carrier. Teaming with Global is a sound move according to analysts. “Global has developed its ACMI business over the past decade. With a well-tested cost basis along with Novick’s highly tuned entrepreneurial antenna the opportunity to pick up talented people and have a debt-free access to a market in disarray is apparent,” said Aerocomm’s Al James.

                      Above: Gidon Novic.   (Image: AviaDev)

A likely date for a launch of the as yet unnamed new airline is December.
Novick is careful to not be seen to be charging headlong into a gap which might not yet exist in this very uncertain market.
In an interview for African Aerospace with Guy Leitch, Novick said: “We are in no rush as the timing has to be right,”
Novick identifies three key challenges arising from the Covid pandemic: The economic challenge; regulatory restrictions; the perception of the health risk in travelling in a cramped airline cabin. He says that the key advantage of starting an airline right now is that “there are great skills and talent available and aircraft can be obtained at extremely good prices.” He admits that he does not know how long it will take for the industry to recover and in particular, how long it will take before passengers start trusting the safety of flying from a health perspective.
He accepts that the economic consequences of the Covid pandemic will have a severe impact on people's ability to afford to fly. Interestingly, he believes that business travel will be the hardest hit due to many businesses having made the switch to video conferencing. He therefore acknowledges that the ‘new normal’ will be a much smaller industry but he is confident that his experience in assembling a ‘lean-and-mean’ airline as well as in the tourism industry, will enable him to launch a winning low-cost carrier.
This contradicts the other low-cost carriers in South Africa, being Kulula, FlySafair and Mango which have long complained about overcapacity in the market, particularly since the arrival of FlySafair with its fleet of seventeen 737s. When asked whether his new airline will not just be adding to this problem, Novick points out that he is still hopeful that the South African government will act rationally regarding its role in the industry. He therefore remains confident that a tightly cost controlled and debt-free start-up will be a successful model.
 

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