Brent Hannon/TAIPEI
Taiwan's Civil Aeronautics Administration is expected to ground domestic carrier U-Land Airlines this month if it fails to pay the $760,000 it owes in airport fees.
The CAA, which is also threatening helicopter operator Asia Pacific Airlines over an outstanding $35,000, has rescheduled U-Land's debt several times but is no longer willing to do so, says Yeh Yung-ching, chief of operations, air transport division.
"We will stop U-Land from using all domestic airport facilities, and in the long term we will stop all their flights," he says. The CAA does not believe U-Land can pay off its debt.
According to U-Land's corporate planning section, its parent company, Rui Lian Construction, will try to pay the money as soon as possible, but airline business is being hindered by a decline in local travel.
Taiwan's passenger traffic fell by more than 10% last year, according to CAA figures.
U-Land has six Boeing MD-80s, three of which are on lease to Air Philippines. The carrier has been in financial trouble since it was grounded for a day in October after cheques to creditors from its parent company bounced.
Analysts have been predicting a shake-out among Taiwan's domestic carriers. This month China Airlines' (CAL) directors approved the merger of subsidiaries Mandarin Airlines and Formosa Airlines. The newly merged Mandarin will take over domestic routes and CAL will fly international services.
Source: Flight International
