EZjet today insisted that it has not shut down.
In a detailed statement a day after the Guyana Civil Aviation Authority (GCAA) suspended its licence, EZjet laid the blame for its woes mostly on Swift Air which it had been wet-leasing aircraft from.
It related details of a showdown at Piarco, in Trinidad on November 7 when it attempted to stop Swift Air from abandoning its passengers on the island. EZjet failed to stop Swift Air from leaving.
EZjet also said that it has to collect US$2.5M in ticket monies which are with travel agents.
It vowed to come back better and said that internal reorganization has to occur first.
The GCAA suspended EZjet’s licence after learning that the US Department of Transportation had suspended the carrier’s licence on Thursday.
Real problems for the 11-month-old carrier developed last month when its owner and chief financier, Sonny Ramdeo was accused in a civil suit in the US of defrauding his former employer. Industry sources say this event prompted a loss of confidence in the carrier which unleashed a series of issues with creditors and service providers.
The government yesterday announced that it has entered into talks with Caribbean Airlines to fill the breach left by EZjet.
The EZjet statement follows:
“The story behind the suspension”
By now rumors are spreading all over the media and social networks about EZjet’s current state of operations. EZjet wishes to present the relevant facts. First and foremost, EZjet has NOT shut down. We were forced to cancel all flights because Swift Air – who owns and operates the aircraft – took off without any notification and left EZjet without a carrier. In response to instructions received from the U.S. Department of Transportation (DOT) and the Guyana Civil Aviation Authority (GCAA), EZjet suspended its operations.
Several factors led to the suspension of services. On October 23, 2012 Swift delivered to EZjet a notice of cancellation. EZjet responded to Swift Air disputing the notice of cancellation. The notice of cancellation indicated that EZjet owed Swift Air money, when in fact Swift Air owed EZjet over US$630,000 in open invoices as well as another US$200,000 for amenities provided to passengers such as hotel, meals, and other charges relating to delays that were attributed to Swift Air. EZjet has consistently asked Swift Air to pay these invoices as the funds were needed to pay for EZjet’s continued operations. As of today Swift Air has not paid ANY of EZjet’s invoices nor has it received a response to the dispute relating to the notice of cancellation.
Swift Abandoned Passengers
On Friday November 2 and Saturday November 3, Swift Air abandoned EZjet’s passengers at the JFK airport and then in Georgetown to take another job of flying the Boston Celtics basketball team within the United States using EZjet’s fuel and airport services. No advance notification was provided to EZjet and we could do very little to avoid this action of Swift Air. Swift felt there was no need to inform EZjet and its passengers of its actions. They did not want the DOT to learn of this cancellation and now EZjet is paying the price for Swift Air’s action.
On Wednesday, November 7, Swift Air put out already onboard passengers at Port-of-Spain, and then stranded JKF-bound passengers in Georgetown, in order fly their empty aircraft to Buffalo, New York, again utilizing EZjet’s fuel and airport services to do so. After the aircraft took off, Swift Air contacted the US DOT and TICO (in Canada) and notified that they intend to stop flying. No advance notification was provided to EZjet.
On Thursday November 8, the DOT delivered to EZjet an email indicating that “EZJet Air has failed to act consistently with the requirements of 14 CFR Part 380. In the circumstances presented, we are requiring that EZJet Air Service Express must immediately cease advertising and operating flights filed under PC 12 119.” The DOT issued this after receiving false and misleading information from Swift Air. Swift lied to the DOT in order to protect themselves from the liability of having to return all U.S. passengers that they took to Guyana.
According to the DOT, in accordance with CFR 14 Part 380.12 and 34, they should have also been notified by both parties regarding this cancellation. Consequently, they were consulting with the US DOT General Counsel’s office as to whether this notice will be accepted after the fact.
EZjet has written to the DOT stating the facts and challenging Swift Air and is currently awaiting a reply.
Payment and Financial Differences
The media carried allegations of Swift Air, without any foundation or facts, that EZjet did not pay them. While Swift Air claims it has not been paid, EZjet believes Swift Air owes EZjet over US$800,000+ relating to various charges that remain unpaid. EZjet paid US$89,000 to Swift Air within the past week as the carrier requested, and EZjet offered to pay US$205,000 more to Swift Air on Wednesday of last week, providing only that Swift Air would state whether it planned to continue or stop flying. There was no answer. While Swift Air’s executives, on one hand, were advising EZjet about flying the next flights, on the other hand, Swift Air’s crew quietly deplaned and stranded EZjet’s passengers then flew their empty aircraft to the US on Wednesday. Their action was unknown to EZjet’s management.
In a similar situation to EZjet, on April 6, 2012, Saipan Air entered into an Aircraft ACMI Charter Agreement with Swift Air relating to the charter of two Boeing 757-200 aircraft and one Boeing 737-400 aircraft. The aircraft were to be delivered to Saipan Air on or before July 1, 2012, to transport tourists from China to various locations in Japan and China to and from the CNMI.
On June 24, 2012, Saipan Air received a letter from a Swift executive – the same who wrote EZjet’s termination letter – dated June 21, 2012, stating that “Swift hereby provides notice to Saipan Air that the agreement is hereby terminated and canceled without further notice or effect.” On June 27, 2012, Swift Air filed for bankruptcy petition. This is the same stunt Swift pulled on EZjet.
It needs to be known that four executives of Swift Air, the supposed partner of Saipan Air Inc., received large bonuses and other payments from Swift Air prior to the company’s filing of bankruptcy protection. Two of these executives were directly overseeing EZjet’s flights. The amended $50-million racketeering lawsuit still named the four executives as defendants along with 10 unnamed co-defendants for allegedly conspiring to obtain money and other property from Saipan Air Inc. The lawyer exposed the alleged large bonuses in the Saipan Air Inc.’s filing in federal court of its first amended complaint against the four executives.
Swift and EZjet show-down at Piarco
There was a show-down in Port-of-Spain on Wednesday November 7. Whist Swift was attempting to fly off with all their crew onboard, EZjet’s management advised the handling company at Piarco not to pushback the aircraft as Swift Air was escaping and leaving our passengers stranded. EZjet’s management gave order to block the aircraft from flying off and told Swift Air that they will not be pushed back until they fly all of our passengers back to Georgetown and complete other obligations to our passengers. Swift managed to utilized another service provider in Trinidad to push back the aircraft and flew off to the US, stealing fuel paid for by EZjet, stranding our passengers and jeopardizing all of our other flights. It was that day that EZjet learnt that Swift Air informed the DOT that that was their last flight. EZjet knew nothing of this. And the DOT took action against EZjet without as much affording us the courtesy to reply to Swift Air’s letters and actions.
Swift Air replaced Dynamic Airways after Dynamic suspended its operations owing EZjet over $1.5 million dollars which includes an $800,000 cash security deposit. EZjet is in the process of seeking legal action against Dynamic Airways for recovery of the sums owing.
The second reason that led us into this situation is poor collection of ticket sales. Currently, over US$2.5 million are held among several travel agencies. These monies were collected from passengers but not yet handed over to the airline. This put a financial strain on the airline that is requested to pre-pay for its flights and fuel.
We want to make it very clear to all of Guyana and our passengers in the US, Canada and Trinidad, that it was not EZjet but Swift Air that led us down this road.
To our passengers, EZjet cares deeply about all of you. We changed the entire landscape just to bring you the best prices and benefits which before you did not enjoy. We are the reason many people flew for the first time and why many of you can fly as many times as you want. We bore all the high prices without any financial assistance from anyone just to make flying affordable to everyone. We never meant for this to happen. We tried our best to avoid it. And we are hurt about the way the situation has turned out.
In order to better serve you and avoid the mistakes of the past, we need time to make changes internally. Regrettably, those changes cannot be made under these present circumstances. We need time to do this. For this reason, we have, most regrettably, suspended the operations. All passengers will be given full refund for the unused portions of their tickets. We know this is an undesirable outcome and we humbly apologise for it. We are asking the passengers to be patient with our staff and bear with us as we process the refunds. To get their refunds, passengers need to contact our Headoffice at 23 Brickdam, Georgetown or call us on 225-7597, 225-9791, 225-7585 or 225-7599 or email us at email@example.com
We will take time to regroup and come better. And by this we mean that plans are being explored to recommence operations soon. This is in light of the fact that carriers have already hiked up their airfare prices by some 30% to 50% since EZjet’s suspension. We value you our passengers. We thank you for your loyalty to us and for staying with us even in trying times over the year. Because we value you, we want to continue serving you. We are going to make those changes necessary to serve you better. We are going to come again.
Thank you for choosing EZjet as your preferred carrier. We will see you again and look forward to your continued support.