The ever-changing Caribbean airline
picture is about to change again.
On the heels of
BWIA's recent announcement to shut down its operations by the end
of the year and launch a new regional carrier called Caribbean
Airlines on Jan. 1 came word that Liat (Leeward Islands Air
Transport) and Caribbean Star Airlines, two fierce competitors on
Antigua, are formally talking merger and collaboration.
Liat's Chairman
Jean Holder, the former secretary general of the Caribbean Tourism
Organization, confirmed that Liat's board had authorized the
carrier to pursue negotiations with Caribbean Star.
Holder said that
the talks "could possibly be concluded by the end of the
year."
R. Allen
Stanford, CEO of Stanford Holdings, which owns Caribbean Star and
Caribbean Sun, welcomed the board's decision to open formal
negotiations.
"I am willing to
work with the Liat shareholder governments and Liat's board to help
create what could become the most modern and efficient airline in
the Caribbean," Stanford said.
While
acknowledging that "competition is the best system in some
environments," Skip Barnette, president and CEO of Caribbean Star
and Caribbean Sun, said that "cooperation appears to be the better
avenue for Caribbean Star, Liat and the region."
Caribbean Star,
formed in 2000 and based in St. John's, Antigua, serves 12
destinations within the region, offering a total of 637 weekly
flights using a fleet of 11 50-passenger Dash-8 turboprops.
Caribbean Sun,
its sister airline, is based in Fort Lauderdale and launched its
maiden flight in 2003. The two carriers are affiliated but operate
as separate companies.
Government-owned
Liat, also based in Antigua, transports 750,000 passengers a year
on a network serving 20 destinations in the eastern Caribbean,
duplicating several of Caribbean Star's routes.
Liat celebrated
its 50th anniversary this month, but in recent years it has been
plagued by financial losses and has had to rely on regular
government bailouts. The carrier reported a $9.3 million loss in
2005.
Mark Darby,
Liat's CEO who was brought in last spring in an effort to stem
losses and put the carrier on more sound financial footing, said
that the carrier was in "a chronic condition, with a loss of $15
million in the first six months of this year."
Darby cut staff,
reduced flights, improved on-time performance and scaled back
operations in an attempt to keep the carrier afloat.
Liat is 80% owned
by the governments of Barbados; St. Vincent and the Grenadines; and
Antigua and Barbuda, but a number of other governments hold
minority stakes in the airline, including Dominica; Grenada;
Guyana; Jamaica; St. Kitts and Nevis; Montserrat; St. Lucia; St.
Vincent and the Grenadines; and Trinidad and Tobago as well several
banks and unions.
To contact reporter Gay Nagle Myers, send e-mail to [email protected].