CAL pins market hope on Max-8 planes and palates, but mum on reset cost

Caribbean Airlines Limited, CAL, is touting a refreshment of its fleet of airplanes, an instalment payment plan for tickets, and a reintroduction of popular Caribbean foods on its flights as lynchpins of a reset of its operations.

This recalibration comes after years of financial woes and service handicaps at the airline were made worse by the travel industry fallout caused by the COVID-19 pandemic over the past two years.

However, the regional carrier says it will not be divulging how much cash it will be spending on the fleet and service reorganisation or the source of financing, describing the numbers and source of cash as being competitively sensitive information.

Aviation trade publications are reporting that CAL has already taken possession of four Boeing 737-Max 8 aircraft, the controversial planes that featured in several crashes and were grounded worldwide, but have since been cleared for flying. Head of public relations for the Trinidad-based airline, Dionne Ligoure, told the Financial Gleaner via email that eight of the leased 160-seater aircraft are to be added, replacing the airline’s 737-800 Next Generation planes in a jet fleet renewal.

“Our new 737-8 aircraft offers a wide range of benefits for our customers and the environment. Fuel and maintenance costs are lower; each plane has 10 more seats than its predecessor; and the aircraft offers state-of-the-art technology and an upgraded level of comfort in every cabin, including in-seat power for mobile devices, a new sky interior, sleek, modern seats, and more,” Ligoure said.

She didn’t give a timeline for the completion of the fleet renewal, but an online site that tracks plane orders says delivery of the other four is expected by mid-year.

Since the start of the year, CAL has been promoting its ‘REset Expectations’ campaign designed to grow passenger traffic and turn around the loss-making airline that reported more than US$109 million in losses for 2020, and US$48 million for the first six months to June last year. Amid the haemorrhaging of cash, the airlines has been kept afloat by loans and by financing from its major shareholder – the government of Trinidad & Tobago, which owns 84 per cent of the carrier, with the remaining 16 per cent held by the Jamaican government.

Hunting external funding

A year ago, CAL was said to be hunting external funding, with the blessings of the Trinidadian government, after a 2020 US$65-million loan, guaranteed by Port of Spain, and another US$75-million debt the government said it was paying on behalf of the airline, proved inadequate to stem the tide of financial loss and keep the airline going.

“We offer an authentic Caribbean travel experience that is unmatched. In keeping with our ambition to reset expectations for 2022, we have introduced a pre-order meal service that allows customers to reserve meals up to 36 hours before flight departure,” said the CAL PR head.

“In the coming months, we will also reintroduce Caribbean Café, our on-board snack cart filled with goodies from across the region,” she said.

The plate enticements are among operational changes prompted by the pandemic fallout, and which the airline’s officials said are aimed at ensuring the business’ sustainability in 2022 and beyond. The airline has been cutting costs and says it has completed a staff-trimming exercise it embarked on last year, in which fewer workers were let go than initially planned. It didn’t give the initial estimate for the staff cuts.

“Following extensive consultations with employees and employee representatives in the various locations that Caribbean Airlines operates, 280 employees were separated from the company — significantly fewer than previously estimated — as part of the company’s restructuring exercise,” Ligoure said.

The categories of workers axed were not stated, with the CAL PR handlers citing company confidentiality policies for the non-disclosure. Just shy of 100 employees were also temporarily laid off for an extended period, with these workers now said to be back to full employment.

“We are determined to offer greater value to our customers, and equally committed to reassert this airline as the leader in regional aviation. With our renewed focus on the customer experience and investment in innovative technology, customers can look forward to improved products and services, advanced levels of comfort, and even greater efficiency and service that are all part of our refreshed brand,” the CAL spokeswoman said.

In the hunt for more passengers, CAL has introduced a ‘Caribbean Layaway’ plan that allows for ticket payment in two tranches.

The Trinidadian government also appears to be opening up new routes for the airline, inking a new air service agreement with Qatar just last week.

“Several tourism and aviation forecasts, including by IATA, have indicated that air travel is unlikely to return to pre-pandemic levels before 2024. However, Caribbean Airlines will continue to focus on our customers and to reignite the passion for travel,” the airline spokesperson said, when asked about the plan to grow passenger numbers.

huntley.medley@gleanerjm.com