The low cost carrier airline market is an attractive one for accommodation and tour operators and recent entrant to the market, Velvet Sky, has announced their opening of two new legs between; Durban and Port Elizabeth and Cape Town and Port Elizabeth. Throwing the cat amongst the pigeons is their ticket prices which start from R439.00 one way – obviously this is dependent upon date and time of departure, an advance booking and availability.
According to Velvet Sky COO, Gary Webb, the average price of a Durban to Port Elizabeth flight (before Velvet Sky announced their intentions to compete on this route) was R1 500.00 which dropped smartly to an average of R650.00 after their announcement.
The Durban based airline is South Africa’s newest and the first BEEE owned Aviation Company which started life on 22 March with it’s first flight from Johannesburg to Durban. That first aircraft, a Boeing 737-300 went on to carry 60 000 passengers in just 100 days.
Velvet Sky now boast two operational planes with two more going into service from November 2011. Aircraft are maintained by SAA Technical. Velvet Sky expects to eventually lease between six and eight aircraft.
The major headache for a low cost carrier is airport taxes which on the low initial fares comprise more than 50% of the ticket cost, making the development of and operating from secondary airports such as the one in Polokwane an attractive proposition for any airline. Webb says that they operate with a “…small business mentality”, but do not sacrifice on safety and what will set them apart from the other airlines is that “our people will do anything”.
Velvet Sky expect to gain most of their passengers from a growing middle class market, the migration labour class, families, small business people, tourism, students and pensioners.
A recent study of the aviation market showed that it contributed 2.1% (R51 billion) to the local GDP and was expected to enjoy a 6% market growth.
Asked why Port Elizabeth, Webb cited that the market to PE was under-serviced, PE is the number 4 destination in the airline market, the region is experiencing economic growth, the growth of Coega, Rugby Sevens and other national events along with the fact that overseas tourists like to do the Garden Route ‘by air’.
Velvet Sky’s majority shareholder is Excalibur Aerospace with 74% which was purchased from the founding company, Macdonald Holdings, which provided start up capital.
And about those cheap fares – I could see cheap R439.00 fares from Cape Town to Port Elizabeth on the Fly Velvet Sky web site but failed to find such bargains from Port Elizabeth to Durban – sorry Mother in Law, you will have to go and visit the Number One Son another time or maybe on another low cost carrier – hope they load those el cheapo fares soon.
Alan Straton
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