(Trinidad Guardian) Caribbean Airlines (CAL) lost an estimated $15 million during the two-day flight disruption of its operations over the weekend, according to sources within the airline.
While the final costs are still being tabulated—from chartering aircraft, compensation, to providing accommodation and meals for stranded passengers in T&T and the region, to the legal cost of seeking an injunction against its union—the reputational damage to the airline cannot be quantified.
The airline said it’s a “shame” that 60 domestic and international flights had to be cancelled during a busy travel period.
In a statement yesterday evening, the airline apologised to thousands of passengers stranded throughout the Caribbean and in T&T and put the blame on its pilots.
CAL said the disruptions were caused “by a high volume of sick calls (93) from pilots” prior to them having to report for duty for their respective flights.
“The unavailability of these pilots, combined with the short notice, made it impossible to recover,” the company said.
CAL said in response to this “critical situation”, the airline immediately wet-leased two aircraft, obtained accommodation for stranded passengers and took legal advice.
CAL noted that it was granted an injunction from the Industrial Court of Trinidad and Tobago against the Trinidad and Tobago Airline Pilots’ Association (TTALPA) to bring a stop to the disruption early yesterday morning.
TTALPA was instructed to direct workers/employees to immediately report to duty following the injunction.
TTALPA chairman Mark Moore told Guardian Media that as instructed by the court, he sent out a communiqué and ordered all members to report to duty once they were medically fit.
TTALPA is currently in negotiations with CAL for 2015-2020 period.
Guardian Media was told that pilot salaries account for 70 per cent of the cost of running CAL, while they comprise five per cent of the total staff.
“The pilots’ actions were deliberate, malicious, inconsiderate and directed to inflict pain and suffering to our passengers. They set about to destroy the airline’s reputation, customer confidence, our brand and loyalty,” one CAL executive told Guardian Media.
CAL said it is very saddened by these developments.
“Over the years, we have been witnessing with great pride the significant strides the airline has made, thanks in no small part to the unwavering support of the taxpayers of Trinidad and Tobago. This support has enabled us to enhance our services, expand our route network, and continually improve the travel experience for our valued customers,” the airline said.
“The events over the past few days have put a significant damper on what have been very positive developments for Caribbean Airlines, and that is a shame.”
CAL said the rest of its team—ground staff, front-end personnel, cabin crew, reservations call centres, maintenance, and management—were as per usual fully prepared to ensure the smooth functioning of its flights.
“Despite our meticulous planning and state of readiness, we could not have anticipated or adequately prepared for these unfortunate events. We thank the entire team for their continued commitment during what was a very difficult period,” it said.
“We deeply regret the distress caused by these disruptions, which were beyond our control, and the subsequent impact on your very important travel plans. We accept that this is a significant setback in our relationship with you. However, we are resolute in our commitment to restoring the trust and affection upon which this most valuable relationship is based, and in so doing, ensure that your future travel experiences are as smooth and pleasant as you rightfully expect.”
Young knocks pilots over disruption
Meanwhile, Minister of Energy and Energy Industries Stuart Young yesterday condemned the action by the pilots.
Speaking at the opening ceremony of a community centre in Cascade, Young placed blame for the shutdown of CAL’s operations squarely on the shoulders of “a handful, a literal handful of individuals who thought that was the way to treat citizens of Trinidad and Tobago”.
“You must understand with an airline we have a wide, wide, customer net of international travellers as well and when you trace that back it is all about entitlement. There is a limited pot that’s the treasury and there are so many persons that have to be looked after, the vulnerable, the aged.”
He reflected on the fact that Government had to use taxpayers’ money to keep CAL afloat during the years of the pandemic. However, he said as difficult as it was for Government, the money was pumped into CAL “because we believed as a policy, we should keep a national airline … going”.
“Citizens let us not fall into those traps because we must always think of the others in our society and not only see what is in front of us right here,” Young added.
In a press release yesterday, the newly formed Tobago People’s Party (TPP) said it stands united with the residents and visitors to Tobago who endured the immense inconvenience caused by the disruptions to domestic and international flights operated by CAL.
It blamed Central Government for the lack of effective leadership and proactive measures taken.
“The people of Tobago, and Trinidad and Tobago by extension, deserve better than this, and it is high time that those who are charged with this responsibility of maintaining connectivity between the islands, the region and the world at large, address this critical issue with the urgency it demands,” the TPP release read.
The People’s National Movement’s (PNM) Tobago Council, in a statement, also said the recent cancellations had caused significant inconvenience to Tobagonians by disrupting the movement of people between the islands, causing deleterious impacts to the local economy.
It called on Caribbean Airlines and the pilots to prioritise the well-being of the travelling public, the tourism sector, and the broader economy.
Airline’s financials
Despite meetings its operational expenditure, CAL still receives a subvention from the State.
In his 2023 budget presentation, Finance Minister Colm Imbert had identified CAL as a better recipient of Government’s “subsidy.”
He said then: “Subsidy of Caribbean Airlines, to keep the airline flying to maintain our connectivity with the rest of the world, at a cost of $700 million per year. It is noteworthy that when the pandemic struck in 2020, even though Caribbean Airlines reduced its operating costs as best as it could and rationalised its staff to the bare minimum, just to keep the airline in the air, the Ministry of Finance was still asked to subsidize the operations of Caribbean Airlines for a 3-year period, until it got back on its feet, by arranging financing to the tune of up to US$300 million or TT$2 billion. So far, we have provided the required support.”
According to the Draft Estimates of Recurrent Expenditure for fiscal 2023, CAL is expected to receive $85,635,130 from the Ministry of Finance for the fiscal year, a reduction of $9,364,70 from fiscal 2022 of $95 million.
Caribbean Airlines posted a loss of TT$172.7 million for the first quarter of 2021. In 2020, the airline posted an operating loss of TT$738 million.
Guardian Media understands that CAL, which was set up debt-free, owes over a billion in debt.
According to the Auditor General’s 2021 report, the Government has acted as guarantor of four loans for CAL — a US$75 million loan ($504,455,772.11) loan from First Citizens, a US$55 million loan from First Citizens, a $436,495,800 million loan from ANSA Merchant Bank and a $443,626,560 loan from ANSA Merchant Bank.
Imbert, who is acting Prime Minister, has not commented on the matter.
