Paul Lewis/WASHINGTON DC
Air transport in the West Indies has claimed yet another victim with the suspension of services by Air Jamaica's sister carrier Eastern Caribbean Express (EC Xpress) in the face of cut-throat competition from BWIA subsidiary BWee Express and Liat.
"This is a business decision based on the fact that the Eastern Caribbean is flooded with capacity. We've been concerned for months and things are not changing. If conditions improve we'll be back. This is a suspension, not a closure," says Keith Pope, EC Xpress president.
In the meantime the St Lucia-based carrier's three leased Bombardier Dash 8-100s will be redeployed by Air Jamaica Express at its Montego Bay hub. The 37-seat turboprops will be used to expand services to the Dominican Republic, Grand Cayman, Haiti, Havana and Nassau.
EC Xpress has been operating for only around a year and claims to have carried 75,000 passengers in its first eight months. Pope says that, since the start of the year, airfares have dropped 30% as the result of BWee and Liat redeploying capacity and the launch of the Carib Sky Alliance.
The decision to stop flying comes only five months after Trinidad and Tobago-based Air Caribbean went into receivership. Observers have blamed the airline's failure on aggressive competition from BWIA, designed to push Air Caribbean out of business.
EC Xpress' demise comes on the eve of BWIA cementing an alliance with Liat, in which it has a 29% stake. The two carriers signed a memorandum of understanding last December and "we're now working on implementing it and working out areas of common resources," says Garry Cullen, Liat's chief executive officer.
Liat's planned tie-up with BWIA and its earlier Carib Sky Alliance forms part of a wider plan to put the financially struggling Antigua-based carrier back on its feet. It also needs to persuade the government to convert $10 million of debt into preferential shares.
There have been calls for start-up Caribbean Star to merge with Liat to strengthen the local airline industry against outside competition.
Source: Flight International
