Wednesday, 2 October 2013

Get on board – Airline needs private investment

Fourteen months after assuming the top post of the embattled and cash-leaking LIAT airlines, Ian Brunton effectively discontinued his tenure as Chief Executive Officer. After what he called a “disastrous summer”, the former CEO for LIAT rival Caribbean Airlines (CAL) submitted his resignation which, according to a press release issued Thursday morning, September 26, has been accepted by the Antigua-based carrier’s Board of Directors. Meanwhile, Chairman Dr. Jean Holder has again served notice of his desire to step down. Again, the Board has begged his further indulgence. It was further announced that Julie Reifer-Jones, who acted as CEO before Brunton joined the team last August, will again be taking up that appointment as the carrier looks to once again fill the challenge post.

Brunton was touted as the best man for the job when he took up the position. Having over fifty years’ experience as a pilot, starting his career in the Royal Air Force flying military jets, before moving to commercial airplanes at BWIA, he is also a qualified attorney and holds both Bachelor and Master of Laws degrees from the University of London. At the time of his appointment, he said that his new job would be a challenge, but that he had wanted to make a difference by helping the struggling airline achieve its full potential. After a summer of screeches, halts, stranded passengers and aircraft malfunctions, all while trying to roll out a new fleet, steps towards reaching that potential may have gotten lost in the background. Brunton has been leading a US$100 million re-fleeting process from ageing Dash-8 aircraft to ATR’s which LIAT had said was designed to help move the airline back into profit by lowering maintenance and fuel costs. However the new planes arrived late, which proved horrid in the face of a protesting aged fleet, riddled with mechanical problems. For all this to take place in summer, the peak time of regional travel in the region, added to the “perfect storm” that would apparently drag the CEO down under.

Of course, many of the airline’s woes continue to be attributed to speculations of political involvement which seems nigh unavoidable given that three of LIAT’s major shareholders are the governments of Antigua & Barbuda, Barbados and St. Vincent & the Grenadines. Whether one sees that political involvement as hurtful, helpful or a bit of both, it is evident that the executive body needs to put in place the structure necessary to see LIAT truly soar, efficiently and competitively speaking. How long will the real shareholders – the everyday West Indian whose taxes go into keeping the carrier in the skies – continue to to be kept in a holding pattern? Governments, both major shareholders and those who have promised to pledge greater financial allegiance in the future, must show by action that they realise the significance of dependable regional travel to the island state economies. Last year, Brunton had warned that the airline could not continue to fly for free and that he would cut routes that were not economically viable to the carrier unless certain governments stepped up their financial contributions. It has been argued that whereas some regional heads would go all out to purchase seats of international carriers in order to secure their airlift, they were slow in recognising that they also had a financially responsibility to play in LIAT’s survival, particularly when LIAT guaranteed the only major airlift into that destination.

The time has come – or at least come around again – where we need to be talking more about further private sector involvement, particularly huge investments of finances and technical resources. Hands are wide open for the former, but without a serious dose of the latter, LIAT will continue on its current trajectory.

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