British Airways affiliate in South Africa to enter liquidation

Comair, which operates a low-cost airline and flies as a regional subsidiary of British Airways, said it's entering liquidation procedures, which could mean far fewer options for air travel in southern Africa.

The Johannesburg-based carrier made the announcement Thursday, more than a week after halting operations due to lack of funding.

Comair is a regional operator of British Airways flights, and it also operates its own low-cost brand, kulula.com.

The move comes more than two years after Comair entered what's known as "business rescue" procedures. In South Africa, this is when a third party essentially takes control of a company in an effort to salvage the business in the midst of financial distress.

Comair officials called it an "extremely sad day for the company, its employees, its customers and South African aviation" in the Thursday announcement.

Although this will have a major impact on flights in South Africa and the surrounding region, it will not disrupt mainline British Airways flights between South Africa and London, a British Airways spokesperson told TPG Friday.

A confluence of factors

Comair flights have been grounded since May 31, when airline officials said they "had no choice" but to voluntarily suspend operations due to lack of funds.

The move affected both British Airways flights operated by Comair as well as kulula.com flights. As part of the suspension of operations, British Airways and kulula.com also suspended ticket sales on Comair-operated flights.

The carrier had been in business rescue proceedings since spring 2020; the company said "unforeseen headwinds," including COVID-19 lockdowns and high fuel prices, had a "material negative impact" on the business.

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Comair also said it was negatively affected by a temporary grounding of its flights back in March of this year, when TPG reported South African aviation officials revoked the carrier's air operating certificate, citing safety concerns. Government officials later allowed Comair flights to return to the sky.

Even as Comair grounded its flights at the end of May, CEO Glenn Orsmond said the company was "inherently a viable business," and it was on track to carry more than 4 million passengers this year. Without the necessary funding in place though, it appears that will not happen.

Related: 3 ways to visit Johannesburg on points and miles

Immediate impact on travelers

The immediate impact of this decision to halt operations is, of course, flight cancellations.

Passengers booked on affected British Airways flights operated by Comair through Sunday have the option to rebook to Johannesburg carrier Airlink at no cost, Comair said. Passengers on affected British Airways flights can get help through the airline's International Contact Center.

British Airways told TPG it's contacting travelers booked on Comair-operated flights to offer refund and rebooking options — including on flights operated by other airlines.

Passengers on British Airways flights will also have access to the airline's "Book with Confidence" policy, since that flexibility extends to existing reservations made before June 8.

When you pull up the kulula.com website, you see a notice that brings you to an explanation of the pending liquidation. The notice says customers with upcoming bookings or those owed refunds "will now become creditors" of the company.

Related: Here's what to do if your flight is canceled or delayed

Long-term impact on travelers

While inconvenient for passengers looking to make alternative travel plans or get refunds, the move will also significantly trim the number of seats available on flights within South Africa and the region.

Between its British Airways and kulula.com flights, Comair operated more than two dozen Boeing 737 aircraft, including 23 Boeing 737-800 jets and three 737-400 planes.

Just the kulula.com route map alone shows the number of key southern Africa routes the carrier served.

Again, the longer British Airways international flights between Cape Town, Johannesburg and London will not be disrupted because they are operated by the main carrier, not Comair.

Related: Returning to South Africa in 2022

Bottom line

After more than two years of the COVID-19 pandemic, a combination of shutdowns and rising fuel prices appears to have been too much for Comair to handle. The airline — which was already dealing with a fragile economic situation in the spring of 2020 — now is now headed for liquidation.

As customers scramble to make alternative plans in the short term, the move will put a damper on air travel in the region for the foreseeable future.