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Thread: CAL and Air Jamaica, What's in the future? Should Air JA been left alone?

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    Question CAL and Air Jamaica, What's in the future? Should Air JA been left alone?

    Rowley: Air Jamaica bleeding T&T ‘like a chop neck’



    May 13, 2013 at 11:35 PM ECT

    Opposition Leader Dr Keith Rowley said yesterday Air Jamaica was bleeding Trinidad and Tobago “like a chop neck”.

    “Right now nobody knows what the Minister of Finance is doing by bankrolling CAL. All he is doing is giving them permission to go and borrow money short term. As of now we don’t know how much money they have borrowed and they writing off $200 million and the CAL board is having a generally good time as you see in the behaviour of (vice chairman) Mohan Jaikaran,” Rowley said.

    He said the airline was now “absolutely bankrupt”.

    Rowley who recalled that he had always opposed the Air Jamaica/Caribbean Airlines merger, said as a backbencher in the last PNM administration, he took strong objection to that Government buying into Air Jamaica and had warned that it could come to no good.

    He was responding to a Sunday Express exclusive story which disclosed that CAL was facing a potential $200 million write-off, after having already been given a $100 million write-off.

    He said it was after serious investigation and study by the International Monetary Fund (IMF) that that international body had advised Jamaica to get rid of its airline.

    “Jamaica needs Air Jamaica more than we do, and if the IMF could have told Jamaica to get rid of that expense, what in God’s name was Trinidad and Tobago Government doing taking up that airline?” he asked.

    Rowley said despite his persistent objections, this People’s Partnership Government came into office and proceeded to buy Air Jamaica.

    Rowley said when he raised issues about what was happening in CAL in the last no-confidence motion last year, not a single Government spokesperson responded to anything he said about CAL.

    “Look at what is happening in CAL today. Imagine you are running a jet airline with multi aircraft going to international areas and you take the cash flow, the working capital for the country, and go and buy jet prop aircraft to go and fly to Tobago, Grenada and Barbados. You have to be crazy,” he said. He said nobody buys planes today as everyone is into lease arrangements.

    Noting that the last chairman, Arthur Lok Jack, had stated that the previous board had left over $100 million in CAL’s account, Rowley said: “Today they are borrowing $40 million by the piece. $40 and $50 million, paying high interest rates for short-term borrowing to keep the airline afloat, while the Minister of Finance is absolutely silent.”

    He also noted that the situation with CAL was now compounded by the legal issue because St Vincent is prepared to push the matter of Trinidad and Tobago being in breach of the Caricom treaty by subsidising CAL and not subsidising anybody else (ie LIAT) with whom CAL is competing in the region.

    He said if this matter goes to the Caribbean Court of Justice, this country would not have a leg to stand on “because we are subsidising an airline which is competing with other airlines in the region who are not part of the subsidy”.

    He said the law (revised Treaty of Chaguaramas) requires that the country either stops the subsidy or makes it available to the other regional airline.
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    Sagattarius notorious saga's Avatar notorious saga is offline
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    DON’T BLAME ME

    Former CAL chairman files claim in court on role in airline’s performance



    May 13, 2013 at 11:34 PM ECT

    Former controversial Caribbean Airlines (CAL) chairman George Nicholas says he’s not to blame for the company’s present financial state.

    The six-year-old airline, of which Nicholas was the chairman for 16 months, has been in the red for the past three years and has suffered millions in losses and write-offs during the same period.

    Nicholas’s response was in a statement of case he filed in the High Court against publisher Maxie Cuffie, for a column Cuffie wrote in the Trinidad Guardian on April 21, 2013 titled “CAL Heads for Another Crash”.

    Cuffie’s column had followed a Sunday Express exclusive that CAL had an accumulated debt of $1.4 billion and was seeking a loan to stem its debt.

    Nicholas took offence at Cuffie’s statement that Prime Minister Kamla Persad-Bissessar had appointed him (George) as chairman, “someone with no significant track record other than employment in the family firm, but stuck with him when from the outset, George Nicholas 111 proved himself manifestly unequal to the task. The absence of aptitude for the job was demonstrated in public spats with the Ministers of Finance (then Winston Dookeran) and Works and Transport (then Jack Warner) whose opinions were ignored as the PM continued to show favour to the neophyte chairman”.

    In his statement of case, Nicholas claimed Cuffie ignored the accomplishments of CAL under his chairmanship.

    From November 2010 to April 2012, the period during which CAL was under Nicholas’ tenure, he identified his achievements as:

    1. Growing the company from circa $600 million to $3.4 billion within 16 months—this notwithstanding having the fuel hedge retroactively increased by 50 per cent by Cabinet in or about November 2011 after billions of tickets were sold premised on the unadjusted subsidy.

    2. Crisis management of an aircraft incident in Guyana. (In July 2011, CAL’s flight BW 523 crash landed at the Cheddi Jagan International Airport in Timehri, Guyana, and the aircraft split into two. All 163 passengers survived.)

    3. Winning the best airline in the region for two years—2011 and 2012—beating over 40 competitors.

    4. Making CAL the State’s second largest revenue earner.

    5. Acquiring two fleets of aircraft (ATR and 767-300s and 8 737-800 aircraft).

    6. Reacquiring the London to Port of Spain route.

    Nicholas stated Cuffie “ignored the recently published reports of the financial and investment successes of the publicly listed company Mora Ven Holdings Ltd of which the claimant (George) is the executive chairman. Mora Ven Holdings Ltd registered a 90 per cent increase in revenue for the first quarter of 2013 and over 500 per cent increase in profit before tax; its Solaris Renewable Energy division formed in 2010 is now present in ten countries and has active interest in Africa.”

    He stated Cuffie’s column “was written in such a manner as to present the current financial situation of CAL as entirely attributable to the claimant, whereas in fact and in truth such is entirely false”.

    The former chairman, in his statement of case filed by Lionel Luckhoo in the civil court on May 7, 2013, included his resume to substantiate the quality of his character and business acumen. His lists CAL in his professional background (November 3, 2010 to date) and itemises his success as:

    1. Significant revenue growth in a competitive market place, year on year.

    2. System wide service upgrades.

    3. Air Jamaica merger and that brand’s profitable turnaround and on time record.

    4. Produced a strong EBITADA result for the first three months.

    5. An eight-digit improvement in net results for the first three months.

    6. Motivating 1,860 employees in 18 destinations through a nimble management structure.

    Nicholas resigned from the cash-strapped national carrier in April 2012 over what he said were statements about his performance by his then line authority, Transport Minister Devant Maharaj.

    He ended his tenure at CAL via letter to corporation sole, then finance minster Winston Dookeran. He was swiftly replaced by Rabindra Moonan.

    The former chairman has not commented on the airline’s activities except to lash out at Dookeran after he revealed CAL’s unhealthy financial state in Parliament last May. He said Dookeran “had failed his people
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    JA Soca Ambassador socapineman is offline
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    What are the real issues here ?

    To me it seems that we have a lot of mismanagement, clearly you have executives that have no business know how......the majority of airlines lease airlines like Rowley stated vs. Buying them now due to the massive tax write off.

    It seems to me that CAL if any should be in the Black, then again we have no idea what are the true motives here.

    Rowley seems more emotional and thinking small minded vs being a top a toppa executive, given the former Air Jamaica routes, CAL would of been foolish not to go after Air Jamaica ......at the end of the day if they didn't and less say JetBlue took it over......then they being larger than CAL now would compete with them for customers in those routes and most of the Caribbean , so JetBlue would eventually put Cal out of business due to economy of scale!

    So clearly IMO Rowley is speaking from I love T&T ...vs a business model of not being taking over or being bankrupt , they CAL had to go ahead with this.

    IMO like most P.M. It seems to me that most C.E.O.s in the Caribbean are crooks also.

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    Registered User iPicong's Avatar iPicong is offline
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    From what I remember reading it was a bad deal they made for AJ.........clearly nobody else really wanted AJ in the state it was in..........add that is not that they don't know how to manage a business is that they take advantage with the freeness because of the government subsidies and bailouts that come no matter what........airline business's tough deses days period because it turn into a monopoly now.........things not gonna change.......it seem like they had it figured out up until they bought AJ
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    Norman SWAGGERIFIC is offline
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    Quote Originally Posted by iPicong View Post
    From what I remember reading it was a bad deal they made for AJ.........clearly nobody else really wanted AJ in the state it was in..........add that is not that they don't know how to manage a business is that they take advantage with the freeness because of the government subsidies and bailouts that come no matter what........airline business's tough deses days period because it turn into a monopoly now.........things not gonna change.......it seem like they had it figured out up until they bought AJ
    AJ deal in itself was not a bad deal, it was not ideal but not bad

    its the wanton wastage and mismanagement by those thiefing indians, giving free money for chutney fete, giving free joy ride for their families, typical of them to run state companies into the ground.

    the whole CAL board need to go, privatise this damn company and give back Jamaicans they airline which their govt cannot run with state funds cuz they dont have it.
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    JA Soca Ambassador socapineman is offline
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    Quote Originally Posted by iPicong View Post
    From what I remember reading it was a bad deal they made for AJ.........clearly nobody else really wanted AJ in the state it was in..........add that is not that they don't know how to manage a business is that they take advantage with the freeness because of the government subsidies and bailouts that come no matter what........airline business's tough deses days period because it turn into a monopoly now.........things not gonna change.......it seem like they had it figured out up until they bought AJ
    No.....it was a good deal for them, again this is basic business practice.

    CAL hands were force...they had to buy AJ to protect their interest in the region, the only other way for CAL to benefit was for the greedy foolish Govt of Jamaica to sell it to the pilots, that would of been the best outcome for cal vs. An established airline buying them.....they then would go after cal profitable routes......this is not what is good for TRinidad vs their best interset.

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    Norman SWAGGERIFIC is offline
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    Quote Originally Posted by socapineman View Post
    No.....it was a good deal for them, again this is basic business practice.

    CAL hands were force...they had to buy AJ to protect their interest in the region, the onlyv other way for CAL to benefit was for the greedy foolish Govt of Jamaica to sell it to the pilots, that would of been the best outcome for cal vs. An established airline buyi g them.....they then would go after cal profitable routes......this is not wbat is good for TRinidad vs their best interset.
    dude, you really think the pilots could run an airline? BTW it is interesting that Air Jamaica, BWIA/CAL barely ever make a profit in its history. from the 1960's to now

    Speaks of the incompetence of our third world mentality, where we just cant get nothing right.

    CAL started fresh just a while ago, and posted a profit under Manning now they over a billion TT in debt

    money going for chutney, money for joy ride, half empty flights, all this on the backdrop of subsidized fuels and high flight prices, so somebody tell me whats going on.

    CAL and CNMG bleeding the treasury and like Caroni 1975 Ltd, they have to go NOW!
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    Registered User iPicong's Avatar iPicong is offline
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    Quote Originally Posted by socapineman View Post
    No.....it was a good deal for them, again this is basic business practice.

    CAL hands were force...they had to buy AJ to protect their interest in the region, the onlyv other way for CAL to benefit was for the greedy foolish Govt of Jamaica to sell it to the pilots, that would of been the best outcome for cal vs. An established airline buyi g them.....they then would go after cal profitable routes......this is not wbat is good for TRinidad vs their best interset.
    It would have been the best outcome for the region if a real business minded group from outside the Caribbean bought AJ.........Swaggabuller does have a point with AJ and CAL not being profitable and they suck overall.......I have experienced both over the years andnitnhas gotten from bad to worse........lets be real.......3rd world jackasses should not be running serious business.........the Caribbean need a airline from the outside with high standards and reasonable prices so that the others will fall in line.......CAL control focked everything up over the past 2 years..........and we almost at rock bottom now.......right now my travel plans over the next few moths have tickets on EVERY airline $200-$300 over the average I been paying in the past.......imagine it's $400+ to fly from island to island.......madness
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    JA Soca Ambassador socapineman is offline
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    Quote Originally Posted by iPicong View Post
    It would have been the best outcome for the region if a real business minded group from outside the Caribbean bought AJ.........Swaggabuller does have a point with AJ and CAL not being profitable and they suck overall.......I have experienced both over the years andnitnhas gotten from bad to worse........lets be real.......3rd world jackasses should not be running serious business.........the Caribbean need a airline from the outside with high standards and reasonable prices so that the others will fall in line.......CAL control focked everything up over the past 2 years..........and we almost at rock bottom now.......right now my travel plans over the next few moths have tickets on EVERY airline $200-$300 over the average I been paying in the past.......imagine it's $400+ to fly from island to island.......madness


    You are missing the point.....or maybe you just don't want to knowledge it, their hands were force, they CAL did what they had to do to protect their interest in the region.


    I will not sign off on the fact that blacks or caribbeans in general don't know how to run a business......I would agree that they are crooks with small vision. Unlike their peeks they elsewhere they know how to utilize the capital markets
    . They steal also....but they are using a different business model, stock options, mergers, etc......to steal.


    You tell me what airline is not in trouble.


    Anyway....to fix this problem for the small minded ppl...CAL should sell off AJ so that all the citizens of T&T who was against this feel better. Then get the Japanese or Chinese since most blacks cater to them...let them come into the region and also buyout CAL........then everyone will be happy.

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    Sagattarius notorious saga's Avatar notorious saga is offline
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    Quote Originally Posted by socapineman View Post
    You are missing the point.....or maybe you just don't want to knowledge it, their hands were force, they CAL did what they had to do to protect their interest in the region.


    I will not sign off on the fact that blacks or caribbeans in general don't know how to run a business......I would agree that they are crooks with small vision. Unlike their peeks they elsewhere they know how to utilize the capital markets
    . They steal also....but they are using a different business model, stock options, mergers, etc......to steal.


    You tell me what airline is not in trouble.


    Anyway....to fix this problem for the small minded ppl...CAL should sell off AJ so that all the citizens of T&T who was against this feel better. Then get the Japanese or Chinese since most blacks cater to them...let them come into the region and also buyout CAL........then everyone will be happy.
    Pineman most people was against this because they saw what happened with BWIA, CAL is just the same picture in a different frame. BWIA/CAL couldn't fix their own problems, how exactly would they solve Air Jam? many people in T&T saw this fiasco waiting to happen and in just the short term their visions were absolutely on point. CAL should have never get entangled with AJ. drop prices, make couple deals and compete with whoever bought AJ. if you could take the gamble buying AJ, what's the difference with taking a risk with what you had before? let someone else deal with AJ problem and fix your own. this is not a we for we but instead don't try to save another sinking ship when your ship have a hole too.
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    JA Soca Ambassador socapineman is offline
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    Quote Originally Posted by notorious saga View Post
    Pineman most people was against this because they saw what happened with BWIA, CAL is just the same picture in a different frame. BWIA/CAL couldn't fix their own problems, how exactly would they solve Air Jam? many people in T&T saw this fiasco waiting to happen and in just the short term their visions were absolutely on point. CAL should have never get entangled with AJ. drop prices, make couple deals and compete with whoever bought AJ. if you could take the gamble buying AJ, what's the difference with taking a risk with what you had before? let someone else deal with AJ problem and fix your own. this is not a we for we but instead don't try to save another sinking ship when your ship have a hole too.
    Ok...I hear you, do you hear me ?


    Forget about most ppl in Trinidad or Jamaica. We are running a business....ok AJ is up for sale....we CAL have a niche market in that region....we are on the board and have to vote yes or no.....ok now to your question...how would they solve AJ issues...they can't, once you buy them it is now your problem, hence if we on the board and did nothing....lets say Jetblue comes in paint the airline up even nicer, massive routes given what and where AJ routes were......then it would be just a matter of time before Jetblue control the region and put CAL out of business, sure the botton line is to be in the black, but you need to defend your turf .....if you don't see it this way...please outline what you would of done.

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    Norman SWAGGERIFIC is offline
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    Quote Originally Posted by socapineman View Post
    Ok...I hear you, do you hear me ?


    Forget about most ppl in Trinidad or Jamaica. We are running a business....ok AJ is up for sale....we CAL have a niche market in that region....we are on the board and have to vote yes or no.....ok now to your question...how would they solve AJ issues...they can't, once you buy them it is now your problem, hence if we on the board and did nothing....lets say Jetblue comes in paint the airline up even nicer, massive routes given what and where AJ routes were......then it would be just a matter of time before Jetblue control the region and put CAL out of business, sure the botton line is to be in the black, but you need to defend your turf .....if you don't see it this way...please outline what you would of done.
    The idea that you are purporting is not ideal for business and competition.Manning had visions of one super Caribbean airline with the control of the market in all the CARICOM countries. Now, keep hearing people talking about the need for a national or regional airline, up to now no one is articulating this so call need. The outside airlines will always be able to service that need, just like Digicel and others came in to corner the telecom market.
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    Sagattarius notorious saga's Avatar notorious saga is offline
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    Quote Originally Posted by socapineman View Post
    Ok...I hear you, do you hear me ?


    Forget about most ppl in Trinidad or Jamaica. We are running a business....ok AJ is up for sale....we CAL have a niche market in that region....we are on the board and have to vote yes or no.....ok now to your question...how would they solve AJ issues...they can't, once you buy them it is now your problem, hence if we on the board and did nothing....lets say Jetblue comes in paint the airline up even nicer, massive routes given what and where AJ routes were......then it would be just a matter of time before Jetblue control the region and put CAL out of business, sure the botton line is to be in the black, but you need to defend your turf .....if you don't see it this way...please outline what you would of done.

    CAL helping Air Jam is like you drowning and I helping you but both of us can't swim, wouldn't both of us go down?

    You looking at it as Jet blue taking over the region, I looking at it as may the best man win for the region. CAL or Air Jam eh lining my pockets, the big boys taking the money and jumping ship, the mentality of islanders is always my island vs their island. this from my island so it should'nt go down but yet the people who lining their pockets laughing all the way to the bank.
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    Get your passport & come ! EloquenceInc is offline
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    Quote Originally Posted by notorious saga View Post
    Pineman most people was against this because they saw what happened with BWIA, CAL is just the same picture in a different frame. BWIA/CAL couldn't fix their own problems, how exactly would they solve Air Jam? many people in T&T saw this fiasco waiting to happen and in just the short term their visions were absolutely on point. CAL should have never get entangled with AJ. drop prices, make couple deals and compete with whoever bought AJ. if you could take the gamble buying AJ, what's the difference with taking a risk with what you had before? let someone else deal with AJ problem and fix your own. this is not a we for we but instead don't try to save another sinking ship when your ship have a hole too.
    I agree with this, and I will say there is a cultural element to Air Jamaica that is all about nothing having to do with business that the Trinis I am sure did not understand, and therefore could not capitalize on.

    Any other business in Jamaica I wouldn't say that, but there are people who are fanatically loyal as Jamaicans to Air Jamaica and fly nothing else...I was never like that because every single time I go to look up a flight they are not the cheapest one...but hey.

    And then what Caribbean totally ignored doing was using Air Jamaica to branch back out into places where there are Jamaicans, but no airline headed nonstop to Jamaica. People are PISSED of late that it always takes a connecting flight to head to Ja. Airtran and Delta have nonstop flights out of Atlanta to Montego Bay, but most of the time the best prices are American Airlines and Spirit (even with the nickel and diming on the bags), and for them you have to connect in Miami or Fort Lauderdale (not sure how they work out of New York since a ton more Jamaicans located there so maybe they have direct flights).

    Caribbean Airlines should have had AirJ flying out of airports not currently served by Caribbean Airlines, and if it was even ONE nonstop flight per day or a couple per week, guaranteed they could have made some money off it.
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    Get your passport & come ! EloquenceInc is offline
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    But since it not working out, and apparently no one knows how to get Air J to make money...sell it to the highest bidder.

    From what I read they shortchanged the Ja masses with the surprise changes to flights and I think the pilots were saying they get shortchanged too...some kind of bait and switch went on. Trinis were not happy about them buying AirJ, Jamaicans were not happy about them buying AirJ...they bought it to have a monopoly in the region which is selfish and now I'm reading they are breaking a regional treaty law by having even subsidized CAL to begin with, giving unfair competition to other carriers.

    Caribbean is still a good concept but they need to find a niche and offer things the other airlines are not offering. Because these days people pockets talking to them and the customer service with Caribbean Airlines leaves something to be desired...is only if they are the cheapest headed to somewhere like Trinidad that I use them. American Airlines is usually where it's at for flights to Jamaica.

    The key to me is, if you are not going to be fanatical about the best customer service, then be fanatical about efficiency and price. Caribbean works out cheapest to places like Trinidad a lot of the time, but they are not efficient and not the best customer service. They are never the affordable option to Jamaica, which provides no incentive to bother with their substandard customer service, and their efficiency is not hot either...
    Who has eyes to see, let them see...

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