CAASA’s Role in General Aviation

The Commercial Aviation Association of Southern Africa (CAASA) was established in its original guise in 1944 to represent the interests of the then fledgling commercial aviation sector in South Africa. Since then the industry has grown substantially and now makes important contributions to the economy in a number of different spheres.

CAASA’s Role in General Aviation

CAASA has helped to facilitate this growth by trying to ensure that policies relating to aviation generally, and commercial aviation in particular, are consistent with the needs of the industry and of the economy.

• In Africa air travel is no longer a luxury commodity, it is a necessity with the lack in rail and road infrastructure. • The air transport industry has not only underpinned wealth creation in the developed world, but has also brought enormous benefits to developing economies in Africa by unlocking their potential for trade and tourism.

The Reality of Air Transport in Africa

Contribution of General Aviation to the South African Economy

In order to enhance its credibility and potential to influence policy debates General Aviation needs to be able to describe, and where possible quantify, the direct and indirect contribution that the commercial aviation sector and its associated supply chain make to the South African economy, and to identify threats and opportunities facing the sector.

Contribution of General Aviation to the South African Economy

CAASA commissioned an economic impact assessment that focusses on the role and contribution of the non-scheduled, commercial aviation sector, and activities related to it.

Classification of activities falling within General Aviation

Non-scheduled Services

Charter Flights On Demand Flights

Air Taxi Commercial Business Aviation

Other Commercial

Instructional Flying

Pleasure Flying ,Agriculture, Photography, Observation and Patrol, Aerial

Advertisement, Construction Support Surveying, Search and Rescue, Other Aerial

Work

The Conceptual Value Chain Of General Aviation

Pre 1994 transport has outpaced the economy, increasing by 90% in real terms, compared with 83% for the whole economy.

However, while the value added by the transport sector consistently grew at a faster rate than the economy as a whole in the first decade of democracy.

Post-2004, the real rate of growth of transport was slower than that of the economy as a whole – growing at an average of only 2% a year, compared with 3.3% for total value added.

This is probably largely a reflection of the declining contribution of the primary and secondary sectors of the economy, which has resulted in relatively lower volumes of freight.

At the same time, other services sectors – most notably finance, insurance, real estate and business services, and telecommunication – which have relatively low transport inputs – have grown at a significantly faster rate than the economy as a whole.

Transport’s share of the gross value added of the South African economy rose from 5.3% in 1994 to 6.2% in 2004, but has since slid back to 5.5% in 2013.

GENERAL AVIATION - UPSTREAM SUPPLIERS Includes: •Aircraft & parts manufacture •Consumables (fuel, oils etc) •Airport services •Air navigation services •Ground transport services (car hire, taxis etc) • Outsourced maintenance •Outsourced training •Regulatory

COMMERCIAL NON-SCHEDULED AIR TRANSPORT Includes value adding activities relating to commercially operated: •Charters •Air taxis •Business aviation •Aerial work •Instructional flying •Pleasure flying

DOWNSTREAM INTERMEDIATE CUSTOMERS Includes: •Aerial work (crop spraying, survey, construction) •Executive transport

DOWNSTREAM FINAL CONSUMERS Includes: •Personal transport •Pleasure flying

The estimated number of people employed in the non-scheduled commercial aviation sector rose from around 7000 employees in the 3rd quarter of 2009 to about 7 700 at the end of 2010, but has since slipped to around 7 400.

Estimated Number Of Employees In The Non-scheduled Commercial Aviation Sector

Non-scheduled commercial aviation sector skills level

Breakdown by skills level: • High level 9.5% • Mid-level 35.0% • Semi- & un-skilled4

2.0% • Informal13.5%

Estimated average annual gross remuneration per worker in the non-scheduled aviation sector

Remuneration has been on a fairly strong rising trend – increasing from around R310 000 to closer to R440 000 over the period. This remuneration is reflective of the generally higher levels of skills required in the sector.

Economic Growth

Continued Growth Required: Economic growth is the primary driver of GA’s growth model. The global economy will grow at a rate of 3.2% per year over the next 20 years, an increase from last year's forecast of 2.98%. The air transportation industry will continue to benefit as air transportation demand is closely linked to economic growth.

GA’s Contributions to the Economy (1)

A healthy small aircraft industry is integral to economic growth. Small aircraft comprise nearly 85 percent of general aviation aircraft. General aviation provides for the cultivation of aviation professionals.

GA’s Contributions to the Economy (2)

General aviation contributes to well paying jobs. Technology developed by general aviation aids all sectors of the aviation field.

Constraints to General Aviation

The average small airplane in the RSA is now 40 years old and regulatory barriers to bringing new designs to market and maintaining older ones are impeding development. An estimated 40% of the registered GA aircraft are grounded - Certificate of Airworthiness (CofA)

Constraints to General Aviation (2)

Over this past decade, the RSA has lost active private pilots every year, partially due to a lack of cost-effective small airplanes. General aviation safety can be improved by modernising and revamping the regulations in this sector to retrofit the existing fleet with new safety technologies.

General Aviation Optimisation

GA businesses need to continuously refine their business models. This is particularly true in the GA environment where competition is high and yields are low.

SACAA and Industry • The ICAO SARPs recommends the safety oversight function in conjunction

with the CARs and CATs and the State Safety Program (SSP) with all the service providers underlying SMSs

• ICAO also recommend an independent aircraft accident investigation department

• ICAO also recommends a very important duty of the CAA, and that is the development of a Civil Aviation Master Plan (CAMP)

• CAMP is an important element in developing and improving Aviation

• ICAO recommends separating the economic regulation of the CAA from the safety regulation. (to avoid compromising safety)

Questions ?