(Jamaica Observer) Low-cost Caribbean airline carrier REDjet, which last month began flying from Barbados to Jamaica, Trinidad, Guyana and Antigua, is looking to add new routes as it begins to fine-tune its operations.
On the 20th of November, REDjet launched its inaugural flight from Port of Spain, Trinidad & Tobago, to Kingston Jamaica. The next day it flew from Trinidad to Barbados and the following day it flew nonstop direct from Guyana to Antigua, the first time that route has ever been flown.
In effect, the airline opened up three new routes rather quickly and is looking to expand on those. It has already lined up flights to St Lucia and is now contemplating operations in Latin America.
Speaking to Caribbean Business Report from the airline’s headquarters in Barbados, REDjet’s chairman Ian Burns said: “The real key thing is that we have now linked the northern Caribbean to the eastern and southern part of the region with a nonstop all-jet service. We made the promise that we would reduce the cost of flights in the region by 60 per cent and we have done so. If you look at the prices in the region there has been a fantastic reduction. One can fly from Jamaica to Barbados round-trip for just US$200.
“From Barbados to Guyana the fare is between US$100 and US$120 including taxes. A round-trip from Trinidad to Barbados will set you back about US$90. The great thing about linking the Caribbean is that you don’t need visas, you just grab your passport and away you go. We are now linking the Caribbean in a very affordable way.”
A helping hand to Caribbean students
Burns points to the travel bill of students of the University of the West Indies (UWI) and notes that is yet another hardship they have to bear on top of high fees and the rising cost of living. He declared that as far as air travel is concerned, REDjet is now able to cut airfares by over 50 per cent for students.
Already REDjet is allowing students in the region to travel with two free bags. He insists that even with baggage, students would still see a 50 to 60 per cent reduction in airfares. He believes those savings can go back into education and during recessionary times students need every penny that they can get.
Targeting the Spanish speaking region
REDjet has considered going into Suriname, but is aware that it already has a national airline. Countries that do have a national carrier will no doubt prove difficult for REDjet to go up against.
The airline’s ambitions do not reside just in the English-speaking Caribbean. It sees plenty of opportunities in the Spanish-speaking side of the region and has set its sights there. “If you are going from English-speaking countries into Spanish-speaking countries, then you have to make a sizable investment in the sense of changing systems, language and specifications on all aircraft designated for those destinations. We are now in the process of doing all that. We have a critical plan in place for the Spanish-speaking countries of the region. The populations are obviously bigger than the English-speaking Caribbean countries and we think we can make our presence felt there,” explained Burns.
More airlift needed for the Caribbean
Many have declared that the Caribbean Single Market and Economy (CSME) and Caricom as a whole has been most disappointing and indeed may well become a failure. One of its shortcomings has been its inability to effectively link the region by air travel which stymies the search for employment opportunities and leisure travel. The linchpin of both the social and economic benefits of the CSME was to be good air links, but after fifty years this has not yet materialised.
On this issue, Burns said: “Most of the countries of Caricom have made it clear that they need more airlift as a key driver of stimulating social and economic growth. What people have not agreed upon is, how are they going to do it? What is plain to see is that the incumbent airlines do not have the capacity to increase the amount of airlift in the region and have been unable to do so for the last 40 years. In fact, it has retracted, so one clearly sees that new airlines in the Caribbean are needed. We need people with a new approach and a new product. The Caribbean region has fallen way behind in competitiveness over the last 20 years, and the cost of air travel has been a major factor here. That’s why many people, both in and out of the region, find it difficult to do business there. Here I’d like to think that REDjet is a catalyst for serious change. When one looks at communication, Digicel came in ten years ago and nothing has come in afterwards. We want to re-energise the airline business in the Caribbean.
“Recently the minister of finance of Barbados was talking about an inner and outer Caribbean. I think that is a retrograde step to say that; after all, Barbados is responsible for the CSME. The region is supposed to be a single market, not an inner and outer disparate entity. What we are finding over the years is that decisions are being made based on what countries in the Caribbean cannot have airlift. Barbados is now deciding which countries around it can have low-fare airlift and I don’t think that is right. You shouldn’t be able to determine for another country whether they can or cannot have a lowfare carrier. Clearly not every country can afford to start an airline because the markets just aren’t big enough. When you have an airline , you have a responsibility to the region and to the consumers not just in your own country. That has to be taken into consideration far above any narrow sense of agenda such as protection of a local airline.”
Red tape eating away at REDjet’s initial US$8-million investment
REDjet’s Barbados partner, the chairman of Williams Industries, Ralph “Bizzy” Williams, has said that excessive delays and suffocating red tape had eaten away at the initial US$8 million set aside for operating expenditure. Now with 100 staff members and three routes secured it finds itself financially constrained and unable to aggressively go about taking market share.
“The money had to be used in all of the delays that took place while we were waiting for permission to fly. We had to use it to pay staff and keep things going though we were not flying…. I am going to lose millions of dollars.
“I believe the technocrats decided that the politicians were wrong in designating REDjet as the national airline of Barbados, so the politicians had to wait on them to proceed; they are the ones who sabotaged us,” Williams is reported to have told the Barbadian press.
Wherever REDjet has gone, it has been met with resistance and a surfeit of bureaucracy that is an abject lesson in how to prevent foreign investors coming to your shores. So what are Burn’s thoughts on this matter?
“Decision making throughout the Caribbean is unbelievably slow and people seem afraid to make decisions. This prolonged decision-making process causes frustration and heightens tensions and leads to the wasting of money. Obviously decisions have to be considered and measured but it has to be much speedier than what currently pertains in the Caribbean. It should be a much more open and transparent process.
“You have people hiding behind closed doors. No one will tell you what level of subsidy Caribbean Airlines and Liat got last year and yet this is taxpayers’ money and taxpayers are entitled to know these things. Governments here tend to adopt this clandestine approach to taxpayers’ money and I don’t think that is right. The taxpayer and consumer should be given far more consideration. Today people want more information and that should be embraced. It’s not the government’s money, it’s the taxpayers’ money and they want to know how it is spent. We have experienced some horrendous delays with governments which have cost us a fortune. For example we have been looking at four routes over the last two years which has meant that Barbados has lost 125,000 passengers which means US$58 million could have entered the economy which will not come back. Now that doesn’t just hurt Barbados, it hurts its neighbours as well.”
Getting a hard time from the competition
REDjet’s CEO added that he is fully aware that many other Caribbean carriers do not want REDjet in the region and regard it as a threat to their business. He mentions that a CEO of one of the key regional carriers came on television and said REDjet has forced it to reduce its fares on certain routes.
“Now that’s something they shouldn’t be announcing with a heavy heart. It’s something that they should be striving to do. It should be one of their internal objectives. To say that you have been forced to reduce fares is symptomatic of the attitude that has prevailed and why airfares are so high in the region,” said Burns.
