Massive Increase In Airfares Threatens New Airline

Adrian Loveridge Talks About The LIAT/Caribbean Star Merger

Is There A Business Plan? St. Lucia’s Tourism Minister Hasn’t Seen It.

I have stayed silent on the proposed LIAT/Caribbean Star ‘merger’ until now because I honestly want at least one commercially driven Caribbean airline to evolve out of the discussions.

Intra-Caribbean travel has been one of the very few success stories for Barbados over the last ten years and the only significant market that has experienced above-inflation growth.

As someone who has championed intra-regional travel for more three decades, I would caution those now managing LIAT, the Caribbean Star airlines to review the massive increases in their fare structure.

The substantially higher airfares now being offered both by LIAT and Caribbean Airlines will be in my humble opinion entirely counter-productive and will not in anyway help the airlines achieve profitability.

Many industry watchers anticipate a downturn in visitor arrivals immediately after the Cricket World Cup from our largest single market, the United Kingdom. Any deterrent to encouraging further travel within the region is going to have a significant effect on the viability of the industry this summer.

I was also surprised to hear Allen Chastenet, the Chairman of the Caribbean Tourism Organisation and newly appointed Minister of Tourism in St. Lucia state that he had not seen LIAT’s latest business plan.

It is in my opinion unreasonable to continually expect the taxpayers to pump money into any entity unless it is explained to them exactly how they are going to redress years of sustained losses losses.

Adrian Loveridge

29 January 2007

11 Comments

Filed under Aviation, Barbados, Barbados Tourism, Politics & Corruption, Traveling and Tourism

11 responses to “Massive Increase In Airfares Threatens New Airline

  1. Pingback: singlepilot.net » Massive Increase In Airfares Threatens New Airline

  2. Sick and fed up Sylvan

    It seems everything Owen Arthur puts his hands on results in a price increase at the expense of consumers. Look at what he has done to Barbados. Trinis used to come here to shop in the 1980s and 90s; now Bajans are flocking to Trinidad to escape the high prices which have become a fact of life under Owen Arthur. Now this champion of regional integration — isn’t he supposed to be in charge of the CSME – has been involved in talks between LIAT and Caribbean Star and the result is a single airline with high fares beyond the reach of the average Caribbean citizen who no longer will be able to experience integration through travel. Caribbean travellers must unite and do the right thing: Boycott LIAT, the star of the Caribbean. Fly to Puerto Rico and the United States instead. Once Liat is not getting enough business, it will get the message and come to its senses.

  3. history repeats itself

    award winning 2006 “piggy at the trough” Owen Arthur is simply doing what he did in Jamaica —helping to run the country into the ground. This is a proven skill set with great expertise.

  4. Jerome Hinds

    The whole issue of regional travel at a reasonable rate/fare has been a perplexing concern for a long time.

    Besides the importance of this medium of transport for CWC 2007 and our decades old Tourism industry – what about its role as being a central plank to the development of our CSM ?

    If we cannot move our goods, services and people at reasonable rates/fares throughout the islands how can the integration process be deepened??

    Since this news broke a few days ago about the high ticket prices I am yet to hear from PM Arthur, who has lead responsibilty for implementing the CSM, speak on this issue !!!

    He spoke publicly up to yesterday in St. George South……..sadly…… all his diatribe was spent trying to villify the DLP…!!!

    But a plausible CSM strategy must be an affordable fare regime for persons to move around the islands and in the absence of a dedicated shipping service among most of the islands, particularly those in the Windward islands… then the airspace must be utilised !!

    To just ask the Barbados Parliament time after time to support funds for LIAT and Bwee (at the time ) would not help the CSM !!!

    A resonable fare regime is what is needed, PM , Arthur……!!!!

  5. PilotBoy

    Just a rumour: I overheard a couple of American Airlines employees saying that the airline might not need to schedule larger B-767 equipment this year to Barbados.

  6. Jerome H.- You are right.
    The unhappy union of LIAT and Caribbean Star with its resultant monopoly prices has come as a shock to us, and at the worst time.

    Both CWC and CSME have taken a body blow that any astute politician could have seen coming. We have become dependent on air travel.

    For a few years there was a weekly ferry between Barbados, Trinidad, St Lucia and Margarita, but efforts to resume that have been thwarted for political reasons, I hear.

    It is pitiful to think we are now more cut off from our neighbours than the last century. Old timers will recall the Federal Palm and Federal Maple which plied between the islands, creating a sense of togetherness.

    We can only pray that this vacuum will attract new entrepreneurs to fill the need. One cannot imagine that a short-haul airline should not be able to flourish in the Southern Caribbean if it is efficiently run. It has been political diviseness which seems largely to have been to blame. But we cannot do without affordable transport between the Caribbean states for long whether by air or sea.

  7. Rumplestilskin

    bystander says >>’It has been political diviseness which seems largely to have been to blame. But we cannot do without affordable transport between the Caribbean states for long whether by air or sea.’

    Political divisiveness? So how can CSME work if we cannot even run an airline together, fish together nor run circket smoothly without petty jealousy and player selection possibly being dependent on island origin?

    How then can rely on a common Court of Appeal when only two islands have thus far signed to the arrangement, when even the host country is not signed on?

    If things continue this way, eventually our final Court of Appeal will be the Court of Appeal in Barbados. Not a bad thing.

    If things continue this way, there will be no CSME, after substantial economic loss and substantial lost time and energy.

  8. Rump- It is hard to disagree with the dismaying conclusions you draw. I believe the Bahamas formally opted to retain the House of Lords over the Caribbean Court of Appeal, a step backwards for Caribbean unity.

    But political impasses notwithstanding, I feel there is hope private enterprise will be permitted to provide cheaper inter-island travel of some sort.

  9. The Caribbean has had a long history of inefficient
    cost intensive and taxpayer subsidized Airline industry.

    I am not familar with Star but let me tell you all airlines in the USA and Canada are increasing air fares, giving less service for it and treating passengers like proverbial dirt. Yet if one believes the reports most are more profitable and successful than before 9/11.

    However, from what little I know about the industry here is what is going on in Canada and the USA that is a bother to passengers but they are putting up with it. Because they have no choice.

    Many airlines are now using unreasonably small jet and prop planes for routes once served by the older DC 9, 727 etc. Air Canada is using small jets made by Bombardier and Brazilia and they are flying full and cheaper. Air Canada even uses this type of equipment between Toronto and Denver.

    The downside to this is that many of these aircraft have serious safety weight restrictions when full and more and more passengers are arriving but not their bags. This has now become a regular source of aggravation. Overbooking is wide spread but in spite of all of this passengers seem to be taking it well.

    I think one of the problems in destinations like the Caribbean is that their carriers are not managed and staffed by knowledgeable execs many of whom up here have hands on experience and are fully informed about aircraft, their technical characteristics and economic strong points that will give them maximum performance for the buck.

    All of this is being done and has to be done at the passengers expense when it comes to comfort, baggage arrival etc but the passenger has no choice as all airlines are moving in this direction to stay alive.

    The airline industry is very competitive and it is a difficult industry to be in. However having said this like Adrian I do not condone private enterprise being constantly subsidized with tax payers dollars because they DO BECOME DEPENDENT ON IT like LIAT. And look at the old BWIA that operated anyway it wanted to and why shouldn’t it if Government kept baling it out. No business can be profitably and economically be operated like this.

  10. EyeSpy

    A quantum re. the per-head subsidisation of island-hopping airlines has emerged.

    In the subsidisation era when regional Gov’ts were ‘subsing’ LIAT,
    and when R.Allen Stanford was ‘subsing’ C.Star and C.Sun,
    that subsidisation was to the tune of US$35 per person, per direction,
    i.e. US$70 per round-trip ticket!

    So.. if you now see your ticket costs going up by that amount plus…
    you’ll know that your travels are no longer being subsidised by the Taxpayer,
    or by a Texas billionaire!

    Frankly, for us all(Taxpayers) to be subsidising to that extent was ridiculous!
    Welcome to the new era of realistic airfares, based on real costs
    (plus some small profit,one hopes)

  11. I agree that the hard earned tax payers should not be used to subsidise travels. Its simply not wise to so as the company will not be motivated to strive hard to survive.