By Vanessa C Rolle, Guardian Staff Reporter
Bahamasair will release 150 persons, which will account for approximately $3.5 million annually in savings, announced Minister of Works and Utilities Bradley Roberts on Tuesday night.
Addressing the 47th Annual Convention of the Progressive Liberal Party, at the Wyndham Crystal Palace Hotel this week, Mr Roberts said also that the airline’s board of directors is proposing pay cuts, amounting to $1 million annually, to bring management and pilots’ salaries in line with the current industry standard.
Speaking on Tuesday’s theme, “Restoring the Infrastructure and Economy”, the Works and Utilities Minister told delegates that overstaffing has always been a problem for Bahamasair, with a current staff count of 716 persons.
It is the Board’s recommendation, said Mr. Roberts, that this figure be reduced by 150 persons, bringing the staff count down to 564 persons. There are approximately 45 Bahamasair employees who have reached the age of 55 and over, and therefore qualify for early retirement from Bahamasair, he said.
The proposal is to absorb the remaining persons in various areas in the Public Service, he said. Mr. Roberts said that throughout the airline’s 29 years in existence, it has incurred expenses far in excess of the revenue it receives.
Consequently, Bahamasair has an accumulated a current deficit in excess of $315 million, and at the end of July 2002 the shareholders deficit stood at $78.0 million, share capital at $9.2 million and an invested, or paid-in capital of $227 million. Mr Roberts said that although the airline continues to operate at a deficit, it enjoys an enviable safety record, and enjoys and open sky arrangement with North America and many other countries.
The present Board of Directors was mandated to restructure the airline so that it would become a profitable entity within two years, and after a careful review of the operations at Bahamasair, the Board has presented government with a set of bold initiatives which should turn the company around, he said.
Bahamasair’s routes will also be realigned to allow sub-carriers to operate on its behalf, continued Minister Roberts. “Whilst the government is prepared to allow sub-carriers to service these routes on behalf of Bahamasair, it is the government’s intention to ensure that the same high operating standards Bahamasair offers is continued by the sub-carriers.
By discontinuing its service to low-density routes, the company will be in a better position to concentrate on high-yield destinations like Marsh Harbour /Palm Beach, Cap Haitien, Haiti, Havana, Cuba, Orlando and the Freeport to Miami routes,” the Minister said. Bahamasair will also lease two additional Dash-8 aircraft by the end of November, which is expected to improve the company’s annual revenue base by some $5 million and ease the flow of traffic experienced during the Thanksgiving and Christmas seasons.
The Board is also seeking government’s approval to offload its two outdated B737-200 aircraft and replace them with the lease of newer and more cost-efficient B737-300 aircraft to provide lift in Freeport, as well as to meet peak demands placed on Bahamasair’s existing routes, the Minister announced. “It is noteworthy that the 737-200 that the company presently owns utilizes some 5,000 lbs of fuel per hour while 737-300 series will burn approximately 2,500 lbs of fuel per hour. Projections on fuel savings alone indicate that the newer 737-300 series will benefit the company by deriving some $9.0 million per annum in revenue,” he said.
Bahamasair is presently holding discussions with a number of major carriers with the view of code sharing to allow easier connections with other international carriers and Bahamasair and subsequently improved lift and revenue, Mr. Roberts said.
“The present Board of Directors have forecasted that with the implementation of the initiatives I have just shared with you, the airline can theoretically achieve profitability and solvency within two years,” he said.
