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Private Airline Concern Over $100m Restructure Of Bahamasair’S Fleet

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamasair’s $100 million purchase of a new aircraft fleet yesterday prompted one private carrier to again question the Government’s aviation industry strategy, given that the new planes appeared to be targeting his routes.

Captain Randy Butler, Sky Bahamas’ president and chief executive, expressed fears that the Government-owned airline would exploit the acquisition, and its annual $20 million taxpayer subsidy, to undercut his prices and provide unfair competition to the private sector.

And he also called for greater transparency over how the national flag carrier’s purchase of five ATR 600 planes will be financed, given that the burden is again likely to be borne by the Bahamian taxpayer via the Government.

Valentine Grimes, Bahamasair’s chairman, yesterday said the 70-seat planes will be used primarily on the Nassau/Freeport/Fort Lauderdale; Nassau/Marsh Harbour/West Palm Beach and Nassau/Exuma routes.

“They’re my routes,” Captain Butler responded, when informed of this by Tribune Business. “I can tell you what they’ve done so far. On Nassau to Exuma, they’ve changed their flights to the same time we do, after finding out our schedule worked better, and dropped their prices.”

He added that Bahamasair also dropped its prices for flights to Cat Island’s Rake N’ Scrape festival to “bottom out” levels that he suggested might have been below cost.

“Talking about Government in the sunshine; we’ve got to have transparency,” Captain Butler told Tribune Business. “Where’s it [the $100 million] coming from?”

The Sky Bahamas chief said there were numerous unanswered questions surrounding the Bahamasair fleet restructuring, such as what it planned to do with the ageing Dash-8 fleet - if it would “park up” the planes, or seek to sell them to recoup part of the $100 million ATR purchase price.

He added that Bahamasair would also have to retrain its pilots on the new planes, and there were issues related to maintenance, supplies, ground equipment and spare parts inventory for the new fleet that needed to be worked out.

“What’s the plan? Where are we going with this? What’s going to be the role of domestic private airlines?” Captain Butler asked of the Government’s aviation strategy, following Bahamasair’s new fleet purchase.

He added that while Bahamasair, as a government-owned carrier, might be able to delay paying certain taxes and fees to the Government, the private carriers and Sky Bahamas could not.

This, he added, was borne out by Bahamasair’s financial statements over the years.

Bahamasair is purchasing three 50-seat ATR 42-600 and two 70-seat ATR 72-600 planes. They are scheduled for delivery between November 2015 and June 2016.

Deputy Prime Minister Philip Davis, who has ministerial responsibility for Bahamasair, said: “Today is a red letter day for Bahamasair and the Bahamas,

“The acquisition of these aircraft is very important to the Bahamas to move people, goods and equipment from one island to another. Air transport has become an essential part of our way of life, and this addition to Bahamasair’s inventory is a critical bolstering of assets.”

Mr Davis said it was “critical” to replace Bahamasair’s present fleet to maintain the airline’s record of “safe, reliable and economical air service, to render it economically viable in the short-term and to make it attractive to private investors in the longer term”.

Comments

Economist 5 years, 5 months ago

Captain Butler. The Government is trying to put you and others like you out of business.

They don't care abut your employees either. They don't care if they lose their jobs.

Remember when the Dash 8s were purchased? Remember what was found by the Commission of Inquiry in the Cayman Islands? They can only do that with Bahamasair.

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TheMadHatter 5 years, 5 months ago

Everyone knows that all Corporations are owned by the Govt in China - and our Govt now being students of the Chinese communists are practicing their craft.

President Hu say "I ga learn ya !!"

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whybahamas 5 years, 5 months ago

As a resident of Abaco, I would hope that other residents welcome this with open arms. Our biggest threat to tourism is lack of flights at a decent price to get people here. We have American, while decent can have high prices. Silver Airlines, which makes Bahamasair look like a first class operation in comparison. A few small operations that might not be flying six months into the future and Bahamasair. As much as everyone complains about Bahamasair, every time I fly with them to West Palm Beach, they are within a few seats of full capacity and most of the passengers are tourists. While overall, I agree that Bahamasair should be sold off or shut down, Abaco will suffer without it.

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ohdrap4 5 years, 5 months ago

and lest we forget, these private ailines crash all thew time, so i aint flying them. even sky bahamas crashed with MHH, luckily there was no loss of life. i stopped flying sky bahamas everr since then.

then there are the dreamers who say we should have ferry boats between the islands. bahmas ferries canceled the sailings on independence day to several destinations, that is nasty of them. so we need bahamas air.

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newcitizen 5 years, 4 months ago

Wow, these are such uninformed comments. Lets hear about all of these crashes that you go on about.

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ohdrap4 5 years, 4 months ago

Sky Bahamas crash in Marsh harbour

Flamingo air crashes: The pilot was carrying his wife and daughter

Ferguson Air crashes: one dead

And the lake killarney plane crash, that took the lives of 9, and the pilot turned off the wrong engine.

Enough said? Yes, these private air carriers crash all the time. The you all blame the govt for not inspecting the planes, that is no consolation when people are dead is it?

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duppyVAT 5 years, 5 months ago

Bahamasair should become our flag carrier and bring stopover tourists to our country ......... the domestic market should be privatized with subsidies to the least travelled routes (like the mailboat model) ............. but this present model is not the economic way to go

But we know that Bahamasair, ZNS, BEC and BTC have been there to reward PLP party supporters ............. Eleuthera people would be disappointed if we privatized Bahamasair

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Economist 5 years, 5 months ago

There are no government owned airlines in the UK, US, Belgium, France, Spain, Switzerland and so on. Why because their national airlines were all inefficient and cost the tax payers millions.

SkyBahamas, Western don't get the millions every year. Safety is up to the authorities in Nassau. If planes crash that is the governments fault.

By the way Abaco did you not know about the Bahamasair plain that did the same thing as SkyBahamas in Eleuthera and more recently in Nassau. And how about the prop blade that came off or the engine that caught fire on the flight from Eleuthera?

Bahamasair is not safe.

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whybahamas 5 years, 5 months ago

Yes, I knew about that. Which is why I personally was looking for alternatives. But now they are getting new aircraft.

Edit

Also, how can you compare the Bahamas to those countries?

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newcitizen 5 years, 4 months ago

They are actually buying used aircrafts

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newcitizen 5 years, 4 months ago

The government has proven time and time again that they have no idea how to run a business. Every year taxpayers are being saddled with hundreds of millions of dollars in costs due to the government wasting their money on inefficient and unprofitable businesses. And they are inefficient and unprofitable because the government does not understand how to operate them. It is time to sell off Bahamasair.

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ohdrap4 5 years, 4 months ago

and, while i mind them paying bahamar and clico i do not mind paying for bahamas air because private operators crash all the time

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themessenger 5 years, 4 months ago

Amen NewCitizen! I wonder if any of these advocates of a government run Bahamasair have stopped to consider the over half a billion in taxpayers money which has already gone to subsidize this albatross since its inception and which we will never recover, with another 20 million again allocated in the current budget. This country has been writing blank checks for Bahamasair long enough,the time to privatize done come and gone, we'll never see it under this administration.

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LatoyaRoberts 5 years, 4 months ago

Everyone just keeps rambling on saying private airlines crash all the time, but what you have to look at is a airline government own or private can crash at anytime, everything on that aircraft can be up to date a serviced and you still can have a incident, weather it being a pilot error or a malfunction of the aircraft.

Reference the indecent with sky bahamas that happened at MMH, a weather related indecent plus a poor runway condition

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