October 29, 2020

St Vincent PM addresses LIAT issues


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gonsalves_stuart2By Theresa Blackman

BRIDGETOWN, Barbados (BGIS) — Prime minister of and the Grenadines, Dr Ralph Gonsalves, has sought to “clear the air” on some of the misconceptions about regional air carrier .

Gonsalves, who is the chairman of the majority shareholder governments of the carrier, was in Barbados for the prime ministerial grouping’s quarterly meeting.

He told reporters during a press conference on Wednesday that, with the carrier being “very much” in the news, he wanted to share some factual information on its current status.

Stating that LIAT was one of the few airlines in the world where all of its aircraft was under two years old, the prime minister noted that “it cost a lot of money to re-fleet”.

“You will recall that the shareholder governments – Barbados, Antigua and Barbuda and St Vincent and the Grenadines had secured a loan from the Caribbean Development Bank for an investment for the re-fleeting … So, a few years ago, we carried out the re-fleeting exercise and we have disposed of the last ,” he said.

Adding that at one time LIAT had 16 or 17 aircraft serving the region, Gonsalves said the airline now had to do so with a smaller number of aircraft.

“The difference then, compared to now, is that back then you had 37-seaters and 30-seaters and now we have 50-seaters and 70-seaters. So, even in terms of the carriage load there is not a real difference between what we had before and what we have now. The fact is, we have fewer aircraft actually moving people, so, therefore, we have to be very prudent as to the routes that we are serving,” he pointed out.

In terms of performance as outlined by LIAT’s management, the chairman explained that up to August this year there was a $5 million net profit, but it was forecast that the airline would lose EC$9.2 million by the end of this year.

“But, this is moving from numbers close to $100 million to $57 million, and even last year, roughly half of the $57 million had to do with losses incurred and selling Dash Eights and paying severance pay,” Gonsalves explained.

He also outlined that a number of reforms had been implemented, as reported in the press. The prime minister pointed out that when he took up his position as leader of St Vincent back in 2001, LIAT had approximately 1,200 persons employed; now it employed 669 individuals, and the head count in the budget was for 630.

“Therefore, a review is being done at the Board level, as we are looking at the organisational structure to determine what is the optimal number of employees we must have going forward in order to serve the entire network…,” he disclosed.

Gonsalves has identified “too many” bouts of illness by flight crew, as one of the major challenges plaguing the carrier.

“We have too many cancellations caused by illness of flight staff and crew. Most of the flight crew, the overwhelming majority of them, are fit and hard workers and smart workers, but … we have too many bouts of illness, which result in cancellations. We have, also of course, the challenge, as I indicated earlier, of a smaller number of aircraft serving essentially the same markets…,” he lamented.

Explaining that they also had “weak technology infrastructure systems” and some ground handling systems that were not optimal, the Vincentian leader noted that although frontline staff were “doing their best”, more training was required to ensure that they were “better able” to handle all of the challenges encountered in dealing with an airline like LIAT.

Admitting that the network, based on the number of routes and flights that the airline served, was a complicated one, the Chairman stated that the airline also had “some really good performing routes”.

“You know when you go on your hit parade you have your top 10, well we have a top 10 also… our top 10 routes. But, we also have routes that are non-performing in the sense of generating negative contribution margins,” he said.

The prime minister disclosed that the priority actions to be taken by management at LIAT included stabilising the schedule by resolving operational challenges; taking action to reduce crew sickness; and communicating in a “sensitive” way with the workers, pilots and other professionals.

The meeting was also attended by Barbados Prime Minister Freundel Stuart; Minister of Tourism and International Transport, Richard Sealy; and chairman of LIAT, .

IMAGE: Prime Minister of St Vincent and the Grenadines and Chairman of the Majority Shareholder Governments of LIAT, Dr Ralph Gonsalves (L) speaking at Wednesday’s press briefing while Barbados’ Prime Minister Freundel Stuart listens. (C. Pitt/BGIS)

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