Low fare airline likely to start service here before Xmas

REDjet, the Caribbean’s first low fare airline, was formally launched in Barbados over the weekend and promises to build “air bridges” throughout the region by offering consumers rock-bottom prices.

Barbadian Minister of Tourism, Richard Sealy (centre) and REDjet Chairman/ Chief Executive Officer Ian Burns (right) standing with staff at the launching of the new low fare carrier on Saturday

Over the last few months Guyana has been among several CARICOM states which have been discussing proposals with REDjet officials, Ian Burns, Chairman of parent company, Airone said.

Guyana and Haiti, Burns said in Barbados on Saturday, have given “conditional approval” for REDjet operations to commence in their territories in the near future. The response, he added, has been especially good in Guyana.

Last Monday a REDjet team met with President Bharrat Jagdeo to discuss proposals for the new air service. These discussions have been going on for the last five months.

When questioned further about the current state of proposals in Guyana and asked for an estimated time for service to commence, Burns declined to comment noting that key discussions were still happening and he could not release any more information on the project at this time.

However, Stabroek News understands that the service is expected to become operational in Guyana and sister territories before the busy Christmas season commences.

During the last four years, Burns explained, the company has worked closely with the region and invested millions into creating an airline based on a simple model which has been born in the Caribbean, for the Caribbean.

This new low fare service, he said, will give consumers more options and will solve the connectivity difficulties of the Caribbean. Air fare costs he said will be reduced by more than 60%. All flights on any REDjet route will start at US$9.99 (before tax); a cost which he believes will definitely encourage island hopping and give a major boost to the declining intra-regional tourism.

Since 2006, he noted, there has been a steady decrease in intra-regional tourism and the industry has lost more than BD$200M in recent times, Burns said referring to Barbados’s situation.

REDjet is already fully staffed and all the mechanisms are in place to begin operations in Barbados, Burns said. There are also other representatives doing ground work and establishing the foundation for bases in other countries including Guyana. However, the company is still awaiting approval of their licence from the Barbadian Civil Aviation Authority.

REDjet has invested over BDS$10M in Barbados, purchased two aircraft and is still developing its corporate offices, call centre and first aircraft base there. It has also created 75 jobs and promises to employ more than 100 persons directly or indirectly.

The projected results of REDjet’s investment in Barbados over the next five years, Burns further said, would be a 2% increase in GDP growth, over US$50M per annum in revenue and more air links for trade, investment and education. Similar benefits will flow to Guyana and other countries which will be a part of the REDjet link.

Tourism

Barbadian Minister of Tourism Richard Sealy described the REDjet venture as “an endeavour that is considered to be one that will remove us from the madness” of flight connections and airfare hassles.

With the effects of the global economic downturn still being felt by many, he said, this is the right time for the Caribbean to get a low fare carrier. Sealy further noted that REDjet’s decision to make Barbados their home base shows that they have confidence in its economy.

The company, he said, will be a Pan-Caribbean low fare operator and will eventually expand its roots to link the Caribbean with Florida.

Intra-regional tourists were found to be the third  largest source market in the Barbadian industry, Sealy noted. It was also the fastest growing market until the economic downturn. However, although there has been a decrease in this market it still maintains its position and REDjet will prompt its growth again.

West Jet, Blue Jet and another Brazilian low fare carrier, Sealy explained, have launched their services in Barbados over the last few years. The airline industry, he said, has to deal with the cost issue and the difficulties which low fare carriers face in offering cheaper prices to consumers must be appreciated.

The government of Barbados, Sealy stated, has given REDjet “lavish concessions” and while he cannot promise the company a decrease in taxation to further aid their efforts he noted that maybe discussions can be pursued with his counterpart in the Ministry of Finance.

REDjet’s introduction into the Caribbean will have a profound impact on the existing competition, Sealy said. Existing airlines will be forced to offer consumers better service at better costs.

This competition, he said, will definitely work in the favour of the consumers and once travelling is made more affordable people will want to do it often and tourism will be the benefactor of this increase in desire to travel.

Low fare service

Surveys conducted in the region over the last four years, REDjet co-founder and Business Development Manager Robert Burns reported, found that only 4% of persons said air travel was good value.

Further it discovered that 93% preferred lower air fares to in-flight movies; 91% preferred lower fares over a “free meal” and 81% preferred to have optional baggage fees instead of compulsory fuel surcharges. The survey also showed that the travelling cost determined the destination of 85% of travellers.

In many cases it costs an additional US$100 or less to travel to the US or Canada so many people choose these destination as opposed to paying almost the same amount to just “hop across” to a neighbouring island.

With REDjet low fare service there are no hidden charges, no compulsory surcharges, the passenger pays only for what they use, there are no stops on the way to a destination and there is no first class.

Tickets, Robert Burns explained, can easily be bought online and then customers have a number of options to pay for them. Guyanese, for example, can book their tickets online and then pay for it using a Bill Direct outlet.

He also stressed that while the airline offers cheap flights it in no way compromises safety. REDjet, he stressed, is committed to maintaining all safety regulations.

Meanwhile, Sales and Promotion Manager Alicia Lynch said that low fare airlines are “no frills” services. There are no charges for extras added to the ticket cost and services like food and insurance are optional.

While there is only a single class type, she explained, passengers have the option of paying a small charge for priority boarding so they can choose their seats. “These priority boarding seats will be limited and seats will not be pre-arranged, you can sit where you want,” Lynch said.

She also noted that while no in flight entertainment will be provided food and beverages will be available for sale at a very reasonable price. The airline will also exercise a strict no waiting and no refunds policy.

“Our promise is the lowest fares, most on time service and less baggage loss,” Lynch said.

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