bhxdtw
Posts: 1035
Joined: Mon Feb 21, 2005 7:28 pm

Air Jamaica = Financial Losses

Thu Apr 13, 2006 10:27 pm

Hi Guys !
Saw this on JM and thought you might find it interesting..  Smile
Does this mean that JM may cut back etc i.e will they pull any routes ?
I always thought that JM were in a good financial position ??
Didnt they plan to serve MAN at one point or did they start it then pull it.
My memory escapes me, im sorry.
Well at least the losses are down from the previous figures !!


Air J still expected to rack up significant losses

The government is projecting the national airline Air Jamaica to earn more than US $400 million in revenues this financial year.

A report on public sector entities tabled in Parliament on Wednesday states that based on strategies to be pursued by the airline during the year, it will realise US $433 million in revenues compared to US $385 million last year.

Air Jamaica's operating expenses are expected to decline by US $20 million or four per cent from the previous year.

Reductions are expected in aircraft lease, costs associated with the grounding of aircraft for maintenance last year, rental of aircraft spares and professional fees.

But these changes will not take the airline from a loss position.

Air Jamaica is expected to suffer a net loss of $74 million down from $135 million during 2005/2006.
 
gayrugbyman
Posts: 1046
Joined: Sat Jul 23, 2005 4:43 am

RE: Air Jamaica = Financial Losses

Thu Apr 13, 2006 10:37 pm

MAN to MBJ/KIN ended early lat year, hurricanes and visa restrictions imposed on Jamaican nationals were muted at the time.

Carried good cargo loads from MAN though. Was twice a week.
 
bhxdtw
Posts: 1035
Joined: Mon Feb 21, 2005 7:28 pm

RE: Air Jamaica = Financial Losses

Thu Apr 13, 2006 10:48 pm

Quoting GayrugbyMAN (Reply 1):
Carried good cargo loads from MAN though. Was twice a week.

Yeah I imagine the Cargo loads would be healthy.

I figure it would be one of the routes where even if the pax loads were low, the flight would still be profitable simply for the cargo.
Though I imagine there would be high amount of tourist and expat traffic using the service.
Im suprised JM doesnt fly elsewhere in Europe..
 
luv2fly
Posts: 11056
Joined: Tue May 13, 2003 2:57 am

RE: Air Jamaica = Financial Losses

Thu Apr 13, 2006 10:56 pm

Quoting BHXDTW (Reply 2):
I figure it would be one of the routes where even if the pax loads were low, the flight would still be profitable simply for the cargo.
Though I imagine there would be high amount of tourist and expat traffic using the service.
Im suprised JM doesnt fly elsewhere in Europe..

Remember until recently JM was owned by Butch Stewart who also owns the Sandals Resort Chain of properties. So he main focus was having JM fly to the Islands that had his resorts.
You can cut the irony with a knife
 
bhxdtw
Posts: 1035
Joined: Mon Feb 21, 2005 7:28 pm

RE: Air Jamaica = Financial Losses

Thu Apr 13, 2006 11:08 pm

Quoting Luv2fly (Reply 3):
Remember until recently JM was owned by Butch Stewart who also owns the Sandals Resort Chain of properties. So he main focus was having JM fly to the Islands that had his resorts.

So with him gone, will JM spread their wings and try and initiate new routes abroad ? Of course when their finances permit ?
 
luv2fly
Posts: 11056
Joined: Tue May 13, 2003 2:57 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 1:37 am

Quoting BHXDTW (Reply 4):
So with him gone, will JM spread their wings and try and initiate new routes abroad ? Of course when their finances permit ?

So far no, they have scaled back and reduced frequencys.
You can cut the irony with a knife
 
commavia
Posts: 9651
Joined: Mon Apr 25, 2005 2:30 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 1:48 am

My solution to this problem:

Recapitalize Air Jamaica by getting government money and control out of the company. The government should divest itself of the company and sell it on the open market.

Then, merge Air Jamaica with BWIA to form a single carrier called 'Caribbean Airways' with hubs in Montego Bay and Port of Spain.

The airline could consolidate on A340s for longhaul flying. Caribbean could fly daily MBJ-LHR, 3x weekly KIN-LHR, 3x weekly MBJ-MAN, and daily POS-LHR (POS-LHR via BGI or ANU ex per week each). For shorthaul flying, the airline would consolidate on the A320/A321 family of aircraft for flights within the Caribbean basin and to North America.

Furthermore, Air Jamaica Express and Caribbean Star could be merged into a single unit, Caribbean Connection, to act as a feeder for Caribbean hubs based on a fleet of Bombardier Q prop aircraft.
 
luv2fly
Posts: 11056
Joined: Tue May 13, 2003 2:57 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 1:59 am

Quoting Commavia (Reply 6):
Recapitalize Air Jamaica by getting government money and control out of the company. The government should divest itself of the company and sell it on the open market.

You got that right, the one thing under Stewart was that the whole flying experience was better, from check in until the flight he really changed the employees around.

Quoting Commavia (Reply 6):
Then, merge Air Jamaica with BWIA to form a single carrier called 'Caribbean Airways' with hubs in Montego Bay and Port of Spain.

This is something that if it happened would greatly benefit both carriers.

Quoting Commavia (Reply 6):
The airline could consolidate on A340s for longhaul flying. Caribbean could fly daily MBJ-LHR, 3x weekly KIN-LHR, 3x weekly MBJ-MAN, and daily POS-LHR (POS-LHR via BGI or ANU ex per week each). For shorthaul flying, the airline would consolidate on the A320/A321 family of aircraft for flights within the Caribbean basin and to North America.

I would agree almost 100% here though I would take MBJ-LHR to 5 trimes a week and same with POS-LHR at least until fuel prices drop. That would also allow the carrier to keep fares high by controling seats into the Island.
You can cut the irony with a knife
 
captaink
Posts: 3987
Joined: Wed May 23, 2001 10:43 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 2:12 am

Quoting Commavia (Reply 6):
My solution to this problem:

Recapitalize Air Jamaica by getting government money and control out of the company. The government should divest itself of the company and sell it on the open market.

Then, merge Air Jamaica with BWIA to form a single carrier called 'Caribbean Airways' with hubs in Montego Bay and Port of Spain.

The airline could consolidate on A340s for longhaul flying. Caribbean could fly daily MBJ-LHR, 3x weekly KIN-LHR, 3x weekly MBJ-MAN, and daily POS-LHR (POS-LHR via BGI or ANU ex per week each). For shorthaul flying, the airline would consolidate on the A320/A321 family of aircraft for flights within the Caribbean basin and to North America.

Furthermore, Air Jamaica Express and Caribbean Star could be merged into a single unit, Caribbean Connection, to act as a feeder for Caribbean hubs based on a fleet of Bombardier Q prop aircraft.

Hmm a dream of many in the caribbean but no likely to happen. BW on the other hand has undergone some changes, got a heavy investment of cash, a new CEO, and POS is up to CAT1 so we may somethings from them.

JM had quite a fiasco early last year when their fleet (most of their A320 series fleet) was grounded. After than some routes were cut like MAN, UVF etc....

Now JM is making some changes to their schedules. Eg. JFK/GND/JFK 4X a week as compared and old routing like JFK/GND/BGI/MBJ and MBJ/BGI/GND/JFK. Lets see what happens with them. I don't feel confident when the governments of these airlines run things, cause it is usualy just a mess. BW has been going through the same drama for many years, nothing ever really changes. What i can say though is that the governments of JCA, and TNT woudl never let the airlines go under.

P.S. LIAT is more likely be pulled into any kind of alliance than Caribbean Star.  Smile
There is something special about planes....
 
jmbweeboy
Posts: 146
Joined: Fri Feb 03, 2006 1:38 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 3:39 am

A few comments on the various postings heretofore:

1. The financial plan for Air Jamaica is to lose money for another 3 years,
albeit less as time goes along.

2. Butch Stewart was just a sugar daddy to Air Jamaica, operated it for 10 years as a hobby

3. New president is Michael Conway of America West, that should mean something.

4. Recently resumed 3XWeek New York-St Lucia service is running so well, 100% load factors every flights, rumour has it daily service coming real soon.

5. Air Jamaica/Bwee Merger ? Nobody more than JMBWEEBOY would like
to see that happen but each operation has to get itself in order first,
two wrongs don't make a right!

JMBWEEBOY
 
commavia
Posts: 9651
Joined: Mon Apr 25, 2005 2:30 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 5:19 am

Quoting JMBWEEBOY (Reply 9):
Air Jamaica/Bwee Merger ? Nobody more than JMBWEEBOY would like to see that happen but each operation has to get itself in order first, two wrongs don't make a right!

Definitely agree with that. Both have to get their houses in order. However, I think that having two primary regional airlines both flying longhaul to Europe that aren't able to take advantage of synergies and economies of scale is inefficient. Melding the marketing base of Air Jamaica and BWIA would improve their ability to channel more traffic volume and drive higher unit revenues. In addition, as I said, the economies of scale and efficiences from combining the two would make the combined carrier more productive.
 
usxguy
Posts: 919
Joined: Wed Jan 25, 2006 1:28 pm

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 5:53 am

don't forget that Mike Conway is in charge of JM now... former N7 leader and HP...
xx
 
acvitale
Posts: 1911
Joined: Sat Aug 18, 2001 8:25 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 6:52 am

Conway buried HP and N7 in bankruptcy. Not a good omen.
 
captaink
Posts: 3987
Joined: Wed May 23, 2001 10:43 am

RE: Air Jamaica = Financial Losses

Fri Apr 14, 2006 7:13 am

BW has that ex CEO from SN Brussels, lets hope he does a better job.

Combining the two airlines would indeed cover the caribbbean. But BW and JM doesn't really step over each others toes. The only route that they seem to do that is Sothern Caribbean/New York. London? JM basically has those airplanes filled with Jamaicans, tourists and maybe a few passengers connecting from other islands. I have never checked in a passenger GND/MBJ/LHR when worked in GND. BW now has MAN and LHR passegers from the lower caribbean islands, locals and tourists alike. JM goes to a host of other US destinations that BW doesn't. BW only serves JFK, IAD, MIA and YYZ in North America.

Now BW has a lot of caribbean routes that JM doesn't fly, so there is not competition between the two. They both can survive without merging if they can make their current route network work. Combining though would almost double their coverage. I wish that would happen, but as mention very unlikely.
There is something special about planes....

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