BWIA CRISIS Director: Treat BWIA like a =91utility=92 By Juhel Browne Guardian 04.12.03 A long-serving member of the BWIA Board has called on the Government to=20 treat BWIA as it would a utility or an infrastructural development because= =20 of the importance of air-links to the region. Unlike Europe and North=20 America, the airline director argued, there is no rail service or highway=20 connecting the various countries in the region. So just as it is part of=20 the Government=92s responsibility to ensure that there are sources of=20 affordable public transport within T&T, it is also the Government=92s=20 responsibility to ensure that there are affordable air links between T&T=20 and the outside world. The privatisation of BWIA has been a relative financial success with the=20 sale of 51 per cent of the airline in 1995 turning around decades of=20 losses, an airline director said Tuesday. The director provided the=20 Business Guardian with an analysis of the airline=92s performance, before= and=20 after privatisation. The analysis reveals that BWIA lost money for the=20 seven years just before the privatisation. It shows that the airline also= =20 lost money in immediate post-privatisation period =96 from 1995 to 1997 =96= =20 during the so-called Acker years. Under the current Conrad Aleong-led=20 management, the airline netted profits in 1998, 1999 and 2000 before the=20 events of 9/11 turned what would have been a profit for 2001 into a=20 loss. Red ink also flowed through the company last year, when BWIA was=20 US$29 million in deficit. The BWIA director argues that last year=92s= losses=20 were beyond the control of the BWIA board and management and that among the= =20 roadblocks to the airline=92s success were factors within Government=92s=20 control. The airline specifically blames the Air Transport Licensing=20 Authority for its failure to regulate the prices charged by BWIA=92s=20 competition =96 both the charter airlines which operate the North American= =20 routes and Caribbean Star which flies within the Caribbean. PRE-PRIVATISATION London New York Miami Toronto Jamaica SERVING Barbados Grenada Antigua St Kitts St Lucia Caracas Guyana Tobago No new routes opened. POST-PRIVATISATION London New York Miami Toronto Jamaica SERVING Barbados Grenada Antigua St Vincent St Lucia Caracas Guyana Tobago Increased frequencies New routes opened: Manchester Washington Paramambo No state support required for above New routes frustrated by category 2 downgrade Atlanta and other US. destinations proposed such as Houston Planned routes requested by state with its support: Costa Rica Cuba Dominican Republic EQUIPMENT, INFRASTRUCTURE AND OPERATED OLD FLEET 4 aging =96 L-1011 5 aging MD-83 Old reservation system Old tracking system Old brand Old uniforms All acquisition costs absorbed by the state. RENEWED FLEET 7 New Boeing 737 Next generation state of the art aircraft 1 Airbus A340 (In prime condition) 1 Airbus A-340 (on order) 3 Dash 8 =96300Q (acquired because of LIAT non-co-operation) All L-1011 and MD-83=92s phased out of the fleet. NEW INFRASTRUCTURE E-Commerce System Call Centre at Sunjet House Hub and Spoke at Piarco Inter-active voice information. System Wide Call Response New brand New uniforms Tobago Express launched Entire re-fleeting and systems etc financed by BWIA profits and IPO. No=20 state support required. ROADBLOCKS TO OPERATIONS 1. Downgrade to Category 2 (Legislative inaction by the State) 2. Resulting loss of United Airlines Code Share (Legislative inaction as=20 above) 3. Free-for-all charter competition (Regulatory non-enforcement by State=20 agency) 4. Charter and regional predatory pricing (Regulatory non-enforcement by=20 State agency) 5. Escalating fuel costs (assistance provided to BA only) 6. Air Caribbean illegal designation by the State and predatory pricing 7. Cabotage rights granted by the State to Caribbean Star 8. September 11th disaster 9. Employee flights disruptions during 2002 peak travel season. 10. Global economic recession 11. Iraq war (inhibiting accurate forward planning). All of the above beyond the control of BWIA board and management. VALUE ADDED 1. 55% to 60% of all enplanements and deplanements and air cargo at Piarco 2. TT$1.7B revenue at peak performance 3. Net foreign exchange earnings of TT$240M per year 4. TT$194.4M salary payment in 2002 5. TT$50M PAYE and VAT in 2002 6. 1,800 staff of which 1,600 in Trinidad and Tobago 7. The only scheduled carrier providing dedicated airlift to the Eastern=20 and Southern Caribbean 8. Company publicly listed with 3,475 shareholders 9. Allied Caterers Limited turned around to high profit centre. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.carstt.com TnT Webdirectory: http://search.co.tt *********************************************************