AIR TRAVEL IN the region would be “paralyzed” were it not for LIAT, says its chairman Jean Holder.
“A casual glance at most departure and arrival boards at airports in the Eastern Caribbean would reveal that LIAT’s services comprise the vast majority of operations,” Holder said in Antigua recently to outline a new reorganization plan for the airline.
“These services are essential, meaning that without them there would be a high level of paralysis of air travel in this region.”
Holder noted that despite the challenges the airline has experienced, it was the longest serving regional carrier.
Over the airline’s 56 years, some 30 carriers had come and gone, he said, with “some of them beginning operations with a business plan based on the demise of LIAT”.
The chairman added that judging from annual losses reported globally, operating any airline was challenging but providing a Caribbean intra-regional air service was “fraught with difficulty, given many aspects of its peculiar financial and operating environment”.
He said there seemed to be a belief that LIAT had been exempt from the suffering caused by the poor state of the global economy and the extremely high cost of fuel, maintenance and manpower.
“Perhaps the reason for this is that through all these difficult times, LIAT has continued to deliver its extensive services, many of which are not commercially profitable and amount to nothing more than a public service.
“This situation cannot continue, especially when only three of the 21 destinations served by LIAT come to its aid when it is in financial difficulty.”
Holder said that unlike all the other Caribbean airlines in the region, “LIAT does not enjoy the luxury of an annual subsidy in its annual budget up front to cushion annual financial losses.
“It also does not frequently enjoy the marketing support and flight guarantees that several foreign operators receive. As far as its daily operations are concerned, LIAT stays alive [through] negotiations with its bankers, the skills of its management, and being forced to charge the customer a fare that meets its costs,” he said.
Holder rejected the idea that the problems of air transportation in the region would be solved by competition.
Referring to those who point out that a great deal more people were travelling when Caribbean Star, Caribbean Sun and Redjet were operating and offering cheap fares, he said they “seem to take away no lessons from the fact that all the airlines mentioned above went bankrupt and ceased to operate and investors lost their money”.
