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Category: Reflections 01 Oct 06

 

This is the third in a series of first person accounts on the dying national airline BWIA, which closes its doors on December 31.

 

This is the story from a former airline manager.

 

“Chronic under-financing and government interference have dogged BWIA since it began as an instrument of the British Government in 1941.

 

“There have been allegations of parasitic relationships, commercial rip-offs, overcharging, ticketing and travel agent scams to the tune of five to seven million dollars a year.

 

“Since 1962, government has failed to get regional support for BWIA (despite its financially disastrous decisions to send flights to St Kitts, and other popular Caribbean destinations) because of its ‘bull in a china shop’ approach to Caricom.

 

“The privatisation in 1995 was undercapitalised. Only ten to 15 million of actual cash investment came from the lead Acker Group and its participants.

 

“The Government ended up with 49 per cent of the airline, including 15.5 per cent employee shares.

 

Debt began piling up

 

“CEO Conrad Aleong had hedged fuel, clamped down on millions of dollars of ticketing and travel scams, but profits morphed into losses.

 

Cost-cutting became essential; management became confrontational with unions. Employees responded with guerrilla warfare.

 

“BWIA share prices dropped drastically (now down from $7 to 30 cents). By the time Aleong departed in 2003, planes had been impounded.

 

“Creditors were owed an estimated $100 million. BWIA limped along. Management was forced to ask employees for concessions.

 

“In 2005, Chairman Arthur Lok Jack’s team was given a mandate by the Government with the following options:

 

“A: Restructure;

 

“B: Shut down BWIA and start the new airline;

 

“C: Shut down BWIA and rely on market to provide uplift.

 

“Option A couldn’t work, since the unions and management couldn’t agree on the “new” contracts.

 

“Option C, although attractive under pure economics, had other implications. It was unacceptable to the Government.

 

“So the Lok Jack committee went with B—the most expensive and hardest option.

 

“Alleged corruption, overstaffing, low wages, low employee productivity, low morale and government interference aside, our collapse is ultimately also due to economic imperatives that are dictated by the population.

 

“Trinidad generates mainly diaspora and business travel. The only reason we have daily London flights is because we piggyback via Barbados, Antigua and St Lucia.

 

“Barbados generates the lion’s share of long haul traffic with its tourist industry.

 

“Yet, Trinis with our big bags object to taking small planes to go to Barbados to get to Miami or London in an ungodly hour, which is the only way the airline can survive.

 

“The traffic to and from NY wants to arrive late in JFK and leave early, so they can be transported by their friends/family without taking time off work.

 

“If you change the timing, the traffic drops. South West Airlines doesn’t go anywhere unless it has at least six flights a day, which one team can handle.

 

“BWIA, on the other hand, has four flights between seven and ten in the morning, and four more between seven and ten in the night. Nothing in between.

 

“Peaks and troughs like that cost you in overtime, underproduction, and inefficient use of resources.

 

“People in the airline industry now facing lay-offs and reapplying to CAL are dying for a leader to come out there, be fearless, truthful and capable.

 

Finally, next week: Staff and management of BWIA respond to the requiem series.

 

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All Articles Copyright Ira Mathur