CAL faces more challenges
By Vernon Khelawan Thursday, August 23 2012
STATE-owned Caribbean Airlines Limited (CAL) will face with some tough challenges before year’s end as two new airlines get ready to take on the Trinidad-based regional airline on some of its more lucrative routes into North America from the Caribbean.
Main focus of the new competition will be the diaspora-filled residents in the high density North American cities of New York in the United States and Toronto in Canada, which is shaping up as the main battlefield for Caribbean airlines old and new.
Leading the charge against Caribbean Airlines Limited (CAL), moreso its Jamaican brand, is the new Fly Jamaica Airways (FJA), which plans to inaugurate services soon to Toronto and New York out of Kingston.
CAL’s Jamaica brand seems to be the more vulnerable at this point, especially when put in the context that its losses last year totalled some (US)$38 million and the prospects for a better performance this year are not too exciting. Additionally, the brand already faces stiff competition from no frills carrier Jet Blue as well as American and two other US carriers.
Speaking in Kingston last week, Lloyd Tai, a former Air Jamaica pilot, now Chief Executive Officer (CEO) of the new airline said the certification process should be completed by September 30. This was backed up by a statement from Eugene Field, Security Inspector at the Civil Aviation Authority of Jamaica who confirmed that certification for FJA was ongoing and should be completed by the end of September.
In a previous statement Tai said the airline planned to appeal to Jamaican and other Caribbean nationals. “It’s a Jamaican airline. Most of our staff will be Jamaican and persons in the diaspora will know we are for them. They are more accustomed to a Jamaican airline,” added Tai.
Tai said the company was looking to have its inaugural flight from Jamaica in early October using its own Boeing 757, twin-engined jet with a configuration of 12/186, making a total payload of 198 seats. The new airline is also expected to begin services between Guyana and Toronto as well as introduce a Guyana- New York service.
If certain regulatory hurdles are cleared soon, CAL can expect more competition on its regional services from the Guyana-based fledgling airline EZjet. Press reports from Guyana revealed that the airline’s Chief Executive Officer Sonny Ramdeo said talks were underway with the Guyana regulatory authorities to inaugurate services between Georgetown and the Caricom states of Trinidad and Tobago, Barbados and Antigua and Barbuda.
The airline, listed as a charter airline, but actually operating more like a scheduled carrier, has been servicing the Guyana –New York and Guyana-Toronto routes since the beginning of this year and now wants to enter the regional market.
But while Ramdeo is seeking to expand its reach, he is also complaining bitterly about “unfair competition” from one carrier which enjoys the facility of subsidised fuel as well as elements of predatory pricing, which has caused fares on the routes to drop drastically. While he did not name the carrier, it was obvious he was referring to CAL, which does enjoy a fuel subsidy from the Trinidad and Tobago Government. The other carrier which operates services to North America from Georgetown is United Airlines.
Interestingly, Ramdeo disclosed that EZjet was looking at the possibility of introducing a lowcost fare model, somewhat similar to the now defunct REDjet, but certainly not (US)$10, where a passenger can buy a seat without luggage, but if the passenger wished to take a bag along, there would be an additional cost of (US)$40.
Ramdeo, in another attack of CAL, blamed the Trinidad airline for a delay in restarting service following an accident at the Cheddi Jagan International Airport (CJIA) a few weeks ago. He claimed that parts necessary to repair the EZjet aircraft got “lost” on a CAL flight, but were found two days after EZjet was back in the air.