Over the past few weeks, Caribbean Airlines Ltd (CAL) has become associated with one thing – confusion. Some may have started reading this in the hope that this column would fuel the flames of this bacchanal. In that case, please accept my apologies. I am looking at
There is no need to remind anyone that the world supply of natural gas is increasing and according to BP’s Chief Economist Christof Rühl, the global demand for oil/gas may have adjusted to a lower level from the previous peak. In economics, an increase in supply plus a decrease in demand, equals downward pressure on market prices. This is not good news for gas producers like
But what does this have to do with a national airline? That is exactly the problem – the apparent disconnect between airline business strategy and tourism development strategy. One reason is the popular myth that the aviation industry is at the mercy of normal market forces. It is not. In my opinion, there is no airline in the “West” that does not enjoy some measure of state support or protection. Governments influence airline behaviour through a dizzying array of legislation, taxes and subsidies. Whether it is a law in the USA mandating that an airline be 75% owned and controlled by US citizens (ask Virgin America) to operate, to landing rights, landing fees, traffic rights, restricted competition on routes, preferential slots, preferential terminals, seat guarantees, tax concessions, etc.
Having proposed that airlines (especially national) are rarely (if ever) allowed to operate without state influence, the next logical question is – for what reason, do states use airlines? Particularly those nations with state owned airlines? A 1990 article in the Asia Pacific Journal of Management provides some insight. In his analysis, Douglas Sikorski from the National University of Singapore, compares two airlines, British Airways and Singapore Airlines. Both of which were originally state-owned and are now privatized. It is clear that while state owned, their organizational objectives were not just financial, but were also socio-political. Although privatized, both still operate in their home markets with certain state sanctioned advantages
If we are serious about driving growth in Tourism GDP and employment, we in
We sometimes forget that the state controls most of the high end rooms in Trinidad (Hyatt and Hilton) and
Now let us focus on the national airline –
Spirit Airlines, the self-titled ultra low cost carrier, tried its hand on the
Please do not misunderstand me.
My name is Derren Joseph and I love my country. As always, I end by saying that despite our challenges, we are so blessed to live in this beautiful land. Let us continue to have the audacity of hope in the future of our beloved country.