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US$70 million loss for Caribbean Airlines
12:38 pm, Wed May 15, 2013
Trinidad and Tobago’s Finance Minister has revealed that Caribbean Airlines (CAL) lost US$70 million last year.
This brings the total loss to US$110 million U.S. dollars when the fuel subsidy is added.
Larry Howai was responding to questions on the state of the national airline in the Senate on Tuesday
According to the Trinidad Express newspaper Howai told the Senate that the airline may be cash strapped, but it had assets which were assisting it to remain solvent.
He said the “preliminary” unaudited” figures showed US$32 million of the US$70 million was incurred by the Air Jamaica route, and another major part of the loss was incurred on the London route.As a result, the management has reduced flights to Jamaica and on the London route, it has terminated the wet-leasing arrangement
The Finance Minister said this is expected to significantly reduce the losses of the airline during this year.
He added that the airline used a lot of its cash in the acquisition of planes and as a result he has instructed a new restructuring of the balance sheet be done where the airline would have to borrow and replace the cash which had previously been used.
Meanwhile, the Trinidad Finance Minister also responded to questions regarding last week's revelation that CAL vice-chairman Mohan Jaikaran issued instructions for 19 complimentary tickets to be approved for a Mother’s Day function in Toronto, Canada.
Howai said an investigation was being conducted by his Ministry and the findings will be presented to Cabinet but he said one explanation put forward by Caribbean Airlines was that it was normal practice, predating that board.
The Finance Minister said CAL outlined that this was an arrangement for marketing of the airline and the arrangement was that part of the cost would have been picked up by the company itself and part by the marketing people. He says CAL has submitted documentation to support that.
Concerning the merger of Caribbean Airlines and Air Jamaica , Trinidad’s Minister of Trade, Industry and Investment Vasant Bharath said it has not worked out the way it was intended.
According to the Trinidad Guardian newspaper - Bharat said the merger did not work because of the intervention of low cost carriers like Delta, West Jet, Jet Blue. He said these airlines have come into the market place and taken a lot of the traffic from the regular routes from Caribbean Airlines.
Bharath is to lead a delegation to Jamaica in June to discuss the issues.
However, despite CAL’s current situation he is optimistic that the troubled airline would break even by 2014.
12:38 pm, Wed May 15, 2013
Trinidad and Tobago’s Finance Minister has revealed that Caribbean Airlines (CAL) lost US$70 million last year.
This brings the total loss to US$110 million U.S. dollars when the fuel subsidy is added.
Larry Howai was responding to questions on the state of the national airline in the Senate on Tuesday
According to the Trinidad Express newspaper Howai told the Senate that the airline may be cash strapped, but it had assets which were assisting it to remain solvent.
He said the “preliminary” unaudited” figures showed US$32 million of the US$70 million was incurred by the Air Jamaica route, and another major part of the loss was incurred on the London route.As a result, the management has reduced flights to Jamaica and on the London route, it has terminated the wet-leasing arrangement
The Finance Minister said this is expected to significantly reduce the losses of the airline during this year.
He added that the airline used a lot of its cash in the acquisition of planes and as a result he has instructed a new restructuring of the balance sheet be done where the airline would have to borrow and replace the cash which had previously been used.
Meanwhile, the Trinidad Finance Minister also responded to questions regarding last week's revelation that CAL vice-chairman Mohan Jaikaran issued instructions for 19 complimentary tickets to be approved for a Mother’s Day function in Toronto, Canada.
Howai said an investigation was being conducted by his Ministry and the findings will be presented to Cabinet but he said one explanation put forward by Caribbean Airlines was that it was normal practice, predating that board.
The Finance Minister said CAL outlined that this was an arrangement for marketing of the airline and the arrangement was that part of the cost would have been picked up by the company itself and part by the marketing people. He says CAL has submitted documentation to support that.
Concerning the merger of Caribbean Airlines and Air Jamaica , Trinidad’s Minister of Trade, Industry and Investment Vasant Bharath said it has not worked out the way it was intended.
According to the Trinidad Guardian newspaper - Bharat said the merger did not work because of the intervention of low cost carriers like Delta, West Jet, Jet Blue. He said these airlines have come into the market place and taken a lot of the traffic from the regular routes from Caribbean Airlines.
Bharath is to lead a delegation to Jamaica in June to discuss the issues.
However, despite CAL’s current situation he is optimistic that the troubled airline would break even by 2014.
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