2.1.1 State of the Airline Industry The state of the global airline industry was characterised by high fuel price increases, competition, exposure to the consumer protection regulations and huge losses. These factors have forced major airlines such as Qantas Airline to retrench 500 workers and Delta Airline invested in a fuel refinery. In the continent, airlines were unlikely to break-even and the industry had challenges such as the high cost of infrastructure and competition from international airlines. Domestically, two airlines namely; Velvet Sky and 1 Time were liquidated due to these challenges. 2.1.2 Contribution of SAA to South African Economy SAA contributes R8.6 billion per annum to the South African economy, contributes R2.4 billion per annum in taxes, an amount of R11 billion per annum impacts on tourism and supported and sustained the employment of 35 000 jobs which are mostly highly skilled.