AIR & SEA
Turbulence Ahead
2007 Air Pacific’s Toughest Year
Fiji national carrier Air Pacific in 2007 had the hardest 12 months of its 65-year history, says airline chairman Nalin Patel in the airline’s 2007 annual report.
The group’s pre-tax operating profit was just F$2.5 (US$1.6) million for the financial year ending March 31 2007, compared to $19.9 (US$12.7) million for the previous year. Operating profit after income tax for the same period was F$17,000 (US$10,929) compared to F$13.3 (US$8.5) million in the previous financial year.
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Tourism arrivals were affected by competition from other Pacific Island and Asian destinations, uncertainty over the introduction of the hotel turnover tax, and travel warnings by foreign governments in the lead up to the May 2006 general election and subsequent coup of December 2006.
The airline says the political turmoil cost it an estimated F$70 (US$45) million in the review period.
Without being specific, Patel says “restructuring against a substantially changed competitive background is being considered,” possibly hinting at a movement away from full-service routes and reconsideration of destinations served.
Air Pacific CEO John Campbell says fuel costs in the year under review ballooned by F$36.5 (US$23.4) million over the comparable period in 2006. He also has a dig at the Fiji government, writing, “Other cost increases have been driven by higher fees and charges from (largely) monopoly providers including airports, government enroute charges, and the Government of Fiji’s increased charges for aviation regulatory overview from CAAFI, customs charges and immigration fees imposed without consultation or negotiation.”
Campbell says the continued loss of experienced pilots to Middle East airlines and bird strikes causing engineering troubles is also adding to costs.
He says the Business Class market virtually collapsed, the decline in tourism, drop in export crops and departure of citizens and expatriates has affected its freight business, and that the Fiji-Japan route “has performed poorly and continues to struggle.”
“We shall continue to support this market but ultimately, if it continues to reflect deep losses, we will be forced to make the difficult decision to withdraw from the route,” Campbell says.
Air Pacific points to one trend it believes will continue; the “last minute” booking of flights by Australian and New Zealand travelers looking for a good deal.
Briefs
Taipei-based Far Eastern Air Transport is looking into expanding its flight schedule between Taipei and Palau from four to seven flights a week. It gave this signal while announcing it will launch charter flights from Taiwan to Shikoku in southeastern Japan March 28.
Continental Micronesia has announced flight schedule changes to its one-stop Island Hopper flight between Guam and Honolulu. The Island Hopper will operate twice a week on Tuesdays between June 10 and August 12 and on Saturdays beginning June 14 and ending August 16. “The new timing on the one-stop will continue to let passengers make their connections onward to U.S. Mainland cities, and in some cases, the timings allow for better connections,” said Continental Micronesia Asia and Micronesia Director for Sales and Marketing David Kendell.
Brisbane - based airline SkyAirWorld has promised cheaper and competitive airfares when it begins operating the five times weekly Brisbane-Honiara route starting in March. Solomon Airlines and Our Airline are currently servicing the Honiara-Brisbane route.The E–190 jet SkyAirWorld will use on the route had been leased by Solomon Airlines but was grounded dispute between the two parties.
Philippine Airlines has reiterated its commitment to expansion in Guam and other parts of the U.S. despite restrictions imposed recently by American aviation authorities. PAL will not alter aircraft orders from Boeing and Airbus despite the flight restrictions. The airline plans to use the Airbus jets to raise its flight frequencies to Saipan, Palau and for daily flights to Guam.
Four Papua New Guinea aircraft crash sites have not been inspected by air safety investigators due to a lack of funds. A PNG Transport and Civil Aviation Department worker asking for anonymity told The National that there are not enough funds to send out the investigators, and in particular to hire the helicopters needed to go to remote areas. The crashes occurred between October 2006 and last month.
