New head for SAA

Briefing reporters in Johannesburg, Gigaba said that Cabinet had approved Kalawe's appointment to the post, adding that it was critical for a new CEO to instil confidence as well as boost the morale of the national carrier.

Kalawe has worked at Denel Munitions and is currently with Compass Group SA as an executive. He also holds an MBA and an electrical engineering qualification among others.

The new CEO will take over from acting chief executive Nico Bezuidenhout who was requested to oversee the group's operations in February following the placing on precautionary suspension and subsequent removal of former acting chief executive Vuyisile Kona.

Kalawe's five year appointment will be a reviewable contract, acting SAA board chairperson Dudu Myeni said at the briefing.

It is not clear when Kalawe will take up the new post as he is still serving his notice period. "He should be starting soon," said Myeni.

"It is expected that he should hit the ground running," said Gigaba, who welcomed Kalawe's appointment, adding that the new CEO will have an important role to play in the strategy.

Gigaba said the transition from the current acting CEO to the new one will be a process managed by the board given that the carrier was already implementing aspects of the new long term turnaround strategy that the minister received on 2 April.

The strategy was submitted following Gigaba's directive issued on 15 October 2012 last year that the airline submit the strategy aimed at improving the airline's financial sustainability and operational efficiency.

This was the first time the carrier submitted a long term strategy in its history. The strategy covers a 20-year-time span.

Gigaba will soon submit the strategy to Cabinet (in May) to note although some aspects of the strategy to which he referred the airline as already "living" were already being implemented. The department was currently reviewing the strategy which aims to focus the airline on ensuring an African footprint network as well as ensuring appropriate and efficient fleet. More details of the document are expected to be made later.

"We do it out of courtesy. It's a company strategy which SAA has to implement," he said, referring to the strategy, saying that it was being implemented due to the urgency to reduce costs and realign root networks at the airline among others.

"For some things we don't need Cabinet approval. We are not expecting Cabinet to approve this but to note it and extend support to it," he said, adding that for some issues that Cabinet support is needed this would be done.

The airline had been busy "for a while now" with cost reduction matters, said Bezuidenhout with a cost reduction plan having been in place for the last 12 months that has realised a saving of between R700 and 800 million. He said the airline was striving for better processes, and had already put pressure on suppliers as well as having started demanding "bang for bucks".

On the issue of securing new fleet, SAA would start an engagement process on securing new fleet "we hope to conclude by the end of May" in terms of a firm wide body fleet option.

Gigaba said that Mango - an entity operating independently from its shareholder South African Airways - as the low cost carrier would play an important role in the strategy. "We expect that Nico will continue playing a role. Mango has an important role to play in the strategy; we expect Mango to grow."