LIAT to axe unprofitable routes

liatThe regional airline, LIAT, says it will take “decisive action” to deal with unprofitable routes as the Antigua-based airline seeks to make its operations financially variable.

“We have been trying, before going the harsh route, to persuade people to invest. We have met with a number of governments and Prime Ministers… we have expressed to them that we will have no other option but to cut the service,” LIAT chairman Jean Holder told a news conference on Thursday evening.

“I think we have reached the point, after a lot of challenges, where we need to do as we say that we will do. That may after all be more effective than the persuasion route,” Holder said after a meeting of the shareholder governments.

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39 Comments

  1. nwo
    March 27, 2014

    I have just read many intelligent articles above. Some based on economies, some seemingly politically inferred, I however have to add the obvious. Clean house!!!! Liat has too many inept managers who are never held accountable for their misactions. The head of engineering should be summarily dismissed for the millions lost in the bad acquisition of the Caribbean Star aircraft . The director of Flight Operations needs to be fired for breach of civil aviation regulations. The company was fined and paid the said fine. How can he hold this position after intentionally trying to force not one but THREE captains to take an aircraft improperly discharged to service? The I T department, contrary to advice, selected an operating system which has proven wrong for the airline’s operations. These few facts have cost Liat, purportedly in excess of 15 million ec dollars. This amount keeps rising as this incompetent bunch keep steering the ship. Now there is a new scapegoat, sorry I mean CEO, to pay an exorbitant salary to accept blame rather than deal with yhe internal issues. In time he will be fired for failing at his job, and the cycle continues.

  2. Traveller
    March 11, 2014

    I welcome this suggestion of change. However there is a need to cut deeper to really make a difference. I am not convinced that pumping more shareholder $$$ into Liat is the answer, doing that would be business as usual.

    Monopoly – Liat has operated as a virtual and silent monopoly by the protection offered because of the share holders (governments). It has therefore been obligated to operate ‘social routes’ which are unprofitable. In the telecoms world this is called universal service obligation (USO). This mindset has to change. Running an airline is a commercial undertaking where decisions must be made that are commercially sound. I agree with Mr. Nassief that a chairman who says his commercial entity cannot be profitable needs to be replaced by someone who can turn the tide around.

    Get rid of the monopoly, free up or reduce service to unprofitable routes. Allow private interest to take up any slack.

    I agree that those at the helm for the past 2 to 4 years are accountable for the state of Liat today and should be flushed out for the right commercial minds to come in and turn the fortunes of Liat around.

    Our governments, through we tax payers, cannot continue to put money into the Liat black hole.

    True change in Liat must be deep and should be swift to make a difference!

    My 2 cents.

    Oh! Did I mention that I travelled from Dominica on Liat on Friday 7th March? I was scheduled to arrive in Grenada at 1030 that morning. Well I got there at 1:30pm with 2 bags missing. At least I got them next day!

  3. Anon Again
    March 11, 2014

    Trevor, you’re absolutely right about buziness not being my forte, but I recognise facts; something you seem to ignore. Why is it that Butch Stewart, one of the Caribbean’s most successful businessmen, was unable to run a profitable Air Jamaica or Air Jamaica Express? Why did Carib Express fail? What happened to Red Jet? Where is Caribbean Star? And I can go on and on. Were the business people owning and running these airlines incompetent, or is there something else? Facts are stubborn things, my friend.

  4. forreal
    March 11, 2014

    i have no comments,because this a wait and see situation,will see who that situation affects,if it affects liat or our neighboring islands

  5. Trevor Fabien
    March 11, 2014

    Reply to Anon Again

    A close relative of mine was going to St Lucia last week and had to fly to Antigua and over night there. This is ludicrous. Is this the service that we want?

    You are misinterpreting what I am saying. There are two things that can happen to LIAT, they can cease to exist or they can become a much more effective and thriving company with competition.

    Many organizations around the world fear competition. They are scared that another bigger badder organization is going to come along that can offer the same features and benefits but will offer them: quicker, cheaper, with more customization, with better customer service, etc. Competition is actually a good thing, in fact it’s a great thing.

    Without competition Apple would have never created their iPod, Microsoft would have never created Windows, and Google would probably be non-existent. Competition is essential because it leads to one very important thing, innovation.

    LIAT has failed to be forward thinking and they have been enjoying the lion share of the market around the eastern Caribbean for quite a few years.

    Now some of us are scared that if LIAT leaves or folds then we will go back to the Christopher Columbus days and have no one visiting us or wont be able to travel. That would not happen.

    Its like telling a woman abused by her boyfriend that she cannot leave because if she leaves she wont be able to find another good guy. That s utter nonsense and I am sure you would all agree with me on this.

    It is the same with LIAT. The leaders in the Caribbean need to come together and really get new investors to run these routes. We cannot have LIAT holding us ransom with terrible customer service.

    As far as I am concerned,, this is not an issue because there is not one person that is happy with LIATs service.

    • Anon Again
      March 11, 2014

      Trevor,
      I didn’t misunderstand you at all. You’re calling for competition, I’m asking why isn’t there competition? It’s not up to Liat to go in search of competition, the investors who you referred to must have surveyed the situation and recognised that the airline business in the Caribbean is woefully unprofitable. I made reference to Caribbean Star, Air Jamaica, Bahamas Air, Cayman Airways, BWIA/CAL, all losing money. The investors in Caribbean Star and Air Jamaica baled out while the governments of Bahamas, Cayman and Trinidad continue to prop up their national carriers.

      Now, I understand your issue with customer service, and they do need to improve in this category. However, taking a flight to Antigua in order to get to St. Lucia might very well be the most cost effective means for the airline. If there are few people travelling from Dominica to St. Lucia, it doesn’t merit a direct flight. This happens with every single carrier that I know. If I fly from Barbados to the Bahamas on American Airlines, I first have to fly to Miami, then catch a connecting back to the Bahamas.

      As for the comparison with an abused woman. I think women, both abused and non-abused, would feel insulted by such a comparison.

      • Trevor Fabien
        March 11, 2014

        You are saying that the investors who you referred to must have surveyed the situation and recognised that the airline business in the Caribbean is woefully unprofitable.

        I take it that business is not your forte my friend cause if it was then you would never make such comment.

        The Eastern Caribbean has over 3 million people and yet you seem to think this is not a profitable area for the aviation business.

        If this is how you think my friend then I think you most certainly do not share the vision that I share in terms of what we can achieve as a Caribbean people in this area.

        I rest my case

    • hmmm
      March 12, 2014

      full the plane from Dominica to St Lucia and you will get a straight flight

  6. Anthony Ismael
    March 11, 2014

    A few months ago the air waves was red hot with news of the proposed international airport in Dominica. According to news reports, the Chinese had agreed to both fund and build the airport. What ever happened to plans for the airport? I can’t seem to get any further details or updates about this project.
    Admin. Can you assist?
    Thanks.

  7. Antigua
    March 10, 2014

    Antigua is the problem of LIAT. Have you ever seen a breakdown of the ticket price? I bought a ticket fr $179.00 US. Tickett cost:$80.00, airport fees(ANU) $75.00. The rest is tax. Now out of that $179, LIAT only gets $80.00!!!!!

    Antigua airport costs are ridiculous, and herein lies the problem of LIAT. The costs in St. Maarten part of my trip was reasonable. LIAT got the bigger piece… besides the $33.00 for departure tax.

    • nwo
      March 27, 2014

      Sorry to inform you, there is a tax at every Island stop. Some are just higher than others

  8. Fitzroy W. Lawrence
    March 10, 2014

    Here are a few steps that this airline could also put in practice on their way to fiscal austerity freedom. First I think that L.I.A.T should market itself as s more disciplined airline in its industry.
    Second, buoyed by lower fuel prices and some stronger economy in its region, their goal should be to scored a profitable quarter, results that could bode well for the rest of the year and possibly into 2015,a recent travel analysts showed that,careful calculations on flights, fees for extras and lower fuel prices can help.
    And finally, why not try this strategy, some carriers were successful in attracting high-paying corporate travelers and vacation fliers.

    Sincerely,

  9. Anon Again
    March 10, 2014

    @Trevor Fabian, you said, “The only way LIAT can get better is by having competition.” There’s no bigger myth. The evidence suggests that running an airline in the Caribbean – or anywhere else these days for that matter – is costly. Within the past two decades or so, some 30 airlines have come and gone. Bahamas Air is running at a huge loss, the same with Cayman Airways. Air Jamaica, when it was being run by Butch Stewart of Sandals, was experiencing hundreds of millions of dollars in losses, forcing Butch to give it back to the government. The government of Jamaica eventually sold it to Trinidad. Caribbean Sun, when it was run by Allen Stanford was making huge losses, until Stanford folded and sold it to Liat. So it’s not that easy.

    @don’t edit, you said, “And the islands with international airports will say….. go head cut your flight…” How will this help the countries with international airports? Liat doesn’t fly from international destinations, it flies within the Caribbean. Therefore, if it pulls out of some routes, or cut service to some, These countries will feel the pain. For the vast majority of countries, Liat is the only one there is. If Liat pulls out of Dominica – it won’t because Dominica is now a shareholder – our country would be in serious trouble. No connections from Barbados, or Trinidad or Antigua,or St. Lucia. Winair only flies to and from St. Maarten. Do you believe Winair would fly all the routes that Liat currently does?

    Clearly we’re not taking time out to research the information to find out what’s happening elsewhere. The issue with Liat – I stated the same in a previous post – is whether or not it ought to provide a social service. If it does, it cannot be expected to make a profit, as the few profitable routes will have to subsidize the majority. Liat has to be fun efficiently, but this doesn’t mean profitably. The moment you go that route, you’re turning the airline into a private enterprise, which Liat ought not be. Private enterprises won’t fly unprofitable routes, which, unfortunately Liat has said it plans to do.

    • budman
      March 10, 2014

      finally somebody makes sense when discussing LIAT

  10. Equality
    March 10, 2014

    When Dominicans stop beg for favours and pay there overweight fees then liat won’t cry so much. Every organization in dominica who have to take part in regional fairs want all bags to be carried for free. They want to pay 1/2 price or less on ticket. How u expect liat to make money? Some of u ungrateful ppl in here bashing liat belong to the very same groups that liat bend over backwards to facilitate.

    • Mary Black
      March 11, 2014

      Is Dominica the only Island that Liat travels to for you to be bashing us like this. If Liat has not been treating travelling Dominicans properly we have the rigth to complain. So put it to rest.

  11. da
    March 10, 2014

    Liat said once they got the new planes everything would be alright, now here they are with another story again.

  12. dont edit
    March 10, 2014

    And the islands with international airports will say….. go head cut your flight..always late or cancelled anyways….

  13. web
    March 10, 2014

    Caribbean Airlines will be waiting in the covers. :lol:

  14. mega
    March 10, 2014

    Liat is the only vendor is the history of business As the only operator in a region (no competition) for almost 60 years and has never nor will ever make a profit.
    In any other organization, heads would roll.
    Pathetic to me.

  15. UDOHREADYET
    March 10, 2014

    The Islands are so close together and LIAT is the main and only Airline for some smaller Islands, the governments invested in their capital in their company and they still cannot get it right. They need new leadership and should fire all their management and reshuffle their board if not declare bankruptcy and start over because asking for more money when you cannot deliver service is deplorable.

  16. Francisco Telemaque
    March 10, 2014

    Dominican are going to suffer more,being held over in antigua,which is ridiculous(Grell).

    Grell, that is good for Dominicans, it serves us right; our stupidity, and backwardness has returned as boomerang in our face. Let me tell you in the 1970’s Gerald (Gerry) Watts, of Antigua born to a Dominica mother, incidentally originating in the village of Vieille Case. He was a minister in the PLM government of George Walters, in headed the ministry of tourism he initiated the improvement of LIAT.

    He decided to equip LIAT with three 747’s in order to facilitate International Flights, which he knew could have helped LIAT function as a profitable entity. Gerry Watts, encourage the powers that be at the time in Dominica, to improve on our infrastructure so that we could have benefit from the 747’s also, he encouraged the Labor Party to build an International Airport, our Labor Party government response was “Dominica is not ready for international airport yet.”

    Eventually, LIAT after the inauguration of a few flights from Antigua to Jamaica in the North, and Antigua to Guyana in the South, the three 747’s became a memory in history! The closest Dominica came to building an International Airport was when Edison James succeeded in getting finance to construct it; within the process, the Labor Party used the construction of such an imperative project to get the UWP out of power, by telling our nation, that we do not need an international Airport. They impress on the people that James simply want to build it, so that he the prime Minister of Dominica (Edison James) want to import more cocaine into the country. Hence, the word corruption was coined!

    Their supporters believed that nonsense. As such each time someone would mention the word International Airport in Dominica, all we heard from the Labor Party was “we doh want it.” Some claimed it was because it was too expensive, others claimed “Antigua, and Barbados have one already, that was made synonymous by the Dominica Labor Party in the homes of all their supporters.

    How dumb are our people. Even when the project actually begun, the UWP lost the election, the first thing the Labor party did under the leadership of the late Rosie Douglas, and company, is shut the project down, they had people such as Gonsalves of St. Vincent advised them to install landing lights at the Melville Hall Airport, that’s all we, Dominica will be set for life. Hence, our present government took that stupid advise and spent more than three hundred million dollars on that pink and red Elephant, when they could have used that money on an new International Airport.

    I take pleasure in rubbing the nose of our stupid politicians, and their supporters into the dirt on this one because of their stupid act. To crown it the Birds of Antigua paid the way of Dominicans living in Antigua to return to Dominica, to vote against themselves, and progress in their country. They were told to go home and vote the UWP out, in order to prevent them from building an International Airport:

    That was a conspiracy devised by the Birds, and Gonsalves, who advised the Birds that if an International Airport is built in Dominica; Dominica will become the Hub, while Antigua will lose that privilege. Nonetheless while Gonsalves made a fool of our Dominica politicians, he built an International Airport in St. Vincent. As soon as St. Vincent airport is on stream, LIAT will become obsolete.

    We, (our nation and people) will forever be the joke of the Caribbean, and the rest of world!

    Francisco Etienne-Dods Telemaque

    • Anonymous
      March 11, 2014

      for once i agree with Dodds eh papa..

    • Anonymous
      March 11, 2014

      i agree

    • Anonymous
      March 11, 2014

      According to my recollection, The United States, under the Reagan administration was prepared to fund an International Airport to Dominica under the Eugenia Charles’ administration. It was Edison James who wrote to the US to discourage them from funding the project citing that they would be interfering in the internal affairs of Dominica. The plans and proposed site is still available for all to see. If i’m wrong, Mr Telemaque, please correct me. Secondly, the UWP did not have the money to build an international airport. The money that they had borrowed for that purpose was almost completely done by the time they left office. They had to use it to pay civil servants and also for other purposes because the country was almost bankrupt under their watch.

      • Francisco Telemaque
        March 11, 2014

        No such thing, I do not know where you got that from, but I can tell you the closest Eugenia Charles ever got to Ronald Reagan, was when she got him to send the Marines to Grenada:

        The only thing she achieved from the invasion of Grenada, was the bombing, and killing a few hundreds of mentally ill persons in an mental institution on the island!

        Eugenia Charles never went into discussion with the late president Ronald Reagan about building an International Airport in Dominica. The only chance we ever had to get an Airport at the expense of the United States, was during World War II.

        Ironically it was commenced at precisely the same place where the pink, and yellow Elephant with landing lights now sits. It was never completed, thanks to the corrupt people of the day, who procrastinated, and due to corruption, all the money reaching the shores of Dominica went into the pockets of the thieves and crooks as usual. Meanwhile, under the same program during World War II; Antigua, St. Lucia, Barbados, Trinidad, Guyana, and Cuba, all got Airports which have long been developed into International Airports operating in the twenty-first century.

        The one built in Cuba, is still owned and operated by the United State, it is located at Guantanamo in Cuba.

        the reason the United States, and its allied Britain in the late 1940’s decided to build these airports in the Caribbean, was because of their strategic locations. Notice St. Vincent was not among the islands considered foe any of the Bases, so now I exposed it, all will realized Gonsalves is correct when he told the Birds of Antigua if they allow Dominica to obtained an International Airport, Dominica will become a Hub, while Antigua will loose that privilege!

        You see the advantage with our strategic position is that an Aircraft can take off in Dominica, plot a course, and without any deviation head direct to Puerto Rico and land, in the case of flying to England, you takeoff and fly North East, without divination, straight to South Hampton in England okay!

        The powers that be however, may not be privy to such information, and if they are is stupidity on their part not to utilized the full potential of our country.

        Francisco Etienne-Dods Telemaque

    • loud
      March 11, 2014

      eddison james did tell the USA that building an airport in dominica is intefering in our political affairs under the freedom party reign. any comments dodds. you conveniently forgot that part of our history.

  17. Trevor Fabien
    March 10, 2014

    I bet you right now, LIAT is a going concern. I would not be surprised if it was liquidated anytime from now.

    I live in London and I know its a longer trip to Dominica as opposed to, lets say flying from Miami or New York. I use to fly into Antigua but not anymore.

    I found out that they are not very friendly and their women are not great eye candy :-D :-D
    So I have now changed my route and I am now flying to St Lucia which is such a much more pleasurable experience. I have friends there and St Lucia feels like Dominica so that eases the stress of having to deal with useless LIAT.

    The only way LIAT can get better is by having competition and that’s exactly what we need in the Caribbean. LIAT has become complacent, one of the biggest errors a business can make. Remember KODAK, they didn’t move with the times and they are no more.

    LIAT wake up and smell the coffee and stop treating us the customers like trash. Get your act together or give up and get out.

  18. Obama
    March 10, 2014

    You mean “financial viable” right?

    • Trevor Fabien
      March 11, 2014

      I meant a going concern. It basically mean they are clutching to straws

      A going concern is a business that functions without the threat of liquidation for the foreseeable future, usually regarded as at least within 12 months.

  19. Patriot
    March 10, 2014

    We are just tired of that hopeless Liat, if they have not got it right after 50 plus years will they ever get it right. Why do you all think that St lucia is not putting money into Liat, it is just throwing it in a bottomless pit. Mr Holder has the nerve to say “persuade people to invest”. Who wants to invest in a company where one will never get a profit which is what business is all about. Hon Gonsalves said about a free right enjoyed by other Caribbean countries, I beg to defer because Liat has never given us a good service for the exorbitant prices that we pay. Mr Holder you have run out of ideas please do us the favour and retire as you did in Caribbean Tourism Organisation, give way to younger and more innovative ideas.

  20. March 10, 2014

    Maybe now they can improve service to customers.

  21. grell
    March 10, 2014

    Dominican are going to suffer more,being held over in antigua,which is ridiculous,its just a big ripoff from liat,they hold you over in antigua to spend money @ the airport.If we are shareholders why can we fly direct from the USVI to Dominica and PR TO Dominica,Skerrit you took our tax dollars,now fight so fight that we can fly directly into our country.

  22. Not again
    March 10, 2014

    We have another island i don’t know about? These routes have been around way before i have been around and i am 23 years old. Why cut them now and not back then? That tells you a lot about the management of Liat. liat is like that pothole on the highway. You patch it today you get some rain tomorrow and it’s back again. To fix that pothole you have to revamp the highway. To fix liat they have to cut ties with Ralph and all the other potholes.

  23. Malatete
    March 10, 2014

    I agree with LIAT. In order for them to survive with a viable business model they must cut out all unnecessary fat. Govt. ministers must stop interfering in the airline’s operations. It is not a social institution nor a club for favoured boys and girls.

  24. Rule
    March 10, 2014

    That’s the result of not having an International Airport. No other Island will join them because they all have International Airports. What will Dominicans get from these cuts after Skeritt gave them 8 million of our money.

  25. Square Pants
    March 10, 2014

    Does that mean LIAT shutting down… or taking off from Antigua and landing back in Antigua. I thought all the routes were unprofitable. hmmmmmm…

  26. Educator
    March 10, 2014

    This is a real laugh. You mean to tell me it took them that long to figure that out? I am not an airline executive and I have been preaching that for years.

    St. Lucia has no problem paying AA to fly from Miami, but they holding back on LIAT. The airline should only operate flights that are necessary for travellers from DA, SVG, ANU and BGI. Let the Lucians, Kittitians and Grenadians such salt.

  27. Brown Sugar
    March 10, 2014

    Hmmmmmm.

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