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Nationwide ceases operations

Citing cashflow concerns, Nationwide Airline abrubtly ceased operations and was placed in provisional liquidation at 1500 on the 29th April 2008. The airline struggled to recover from being grounded by South Africa's Civil Aviation Authority in December 2007, and a combination of high fuel prices (jet fuel prices rose 83% over the year) and low passenger loads led to cashflow problems in 2008.

People owned money by Nationwide

If Nationwide airline owe you money, conact the provisional liquidator (Michelle du Plessis of Tshwane Trust) at 0861 874 926 or by email at tshwanetrust@intekom.co.za. You can also get hold of the liquidation documents here (including claim form).

Bad timing

With Thursday the 1st May and Friday the 2nd May being public holidays, it was not very good timing for Nationwide to cease operations. This was similar to the situation on the 1st December 2007 when Nationwide was grounded just before school holidays. It's estimated that some 25,000 people were left stranded by Nationwide's liquidation.

Passenger left stranded

Passengers who could not make alternative arrangements were left stranded at airports, unsure whether they would ever be able to reclaim any funds.

Last flight

Only aircraft that had already been pushed back at the time of decision to cease flights were permitted to go. Flight CE723 from Cape Town to Johannesburg, leaving at 3pm on the 29th, was the last Nationwide flight.

Aircraft parked at OR Tambo International Airport

Nationwide requested that ACSA find a spot to park their 11 aircraft at Johannesburg O.R. Tambo International Airport :

  • eight Boeing 737-200

  • two Boeing 737-500

  • one Boeing 767-300 (leased)

Nationwide's statement

On the 29th April 2009 at 1300 Nationwide released the following statement:

"On the 7th November 2007, Nationwide Airlines experienced an engine separation from a Boeing 737-200 on departure from Cape Town. Subsequent to this a protracted grounding of our fleet was mandated by the South African Civil Aviation Authority. In the months of December and January we resumed operations and attained a gradual recovery of the business however in the months of March and April we faced a 30% increase in fuel costs coupled wiht a decrease in passenger load factors. Throughout this period we continued to work towards securing investment by a black empowerment consortium which unfortunately has not come to fruition. Our cash-flow has become critical and as a result have decided to voluntarily cease all flight operations until further notice. We apologize to our loyal customers for any and all inconveniences experienced."

Nationwide plane at Cape Town Airport

Impact on share prices

Comair, which runs the Kulula and British Airways brands in South Africa saw its share price climbing 9.5%, its biggest advance in almost 3 months. 1Time airline's share price increased 4.5%.

Not answering their calls

Nationwide Airline's Financial Director Peter Griffiths and Marketing Manager Roger Whittle weren't answering calls by Bloomberg News to their cellphones on the 29th. The telephone at Nationwide's head office went unanswered with a message advising that its administrations and reservations offices were closed.

Responses

Nico Bezuidenhout from Mango Airlines described it as an "unwelcome surprise". "Mango will endeavour to assist stranded domestic passengers wherever possible with preferential fares at our guest services counters in Johannesburg, Durban and Cape Town."

Flights Centre South Africa had been selling Nationwide tickets until early Tuesday afternoon (the 29th April):
"We were absolutely blindsided, we were completely unaware", said Flight Centre spokesman Amanda Hardy.

"Passengers have the option of utilising South African Express' services. However, South African Express will not accept or redeem any Nationwide tickets".

"If Nationwide is not going to receive a lifeline, it will mean that our members and many other employees at the airline are going to sit without jobs." United Association of South Africa

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