Soon Caribbean Airlines passengers will be able to fly on the first of the airline’s brand new Max 8 aircraft, but the real beneficiary of the move could be CAL’s bottom line with significant cost savings from lower fuel consumption, less maintenance costs and importantly, less carbon emission.
Two weeks ago, the national airline took possession of its spanking new Boeing 737 Max 8 aircraft.
It is the first of several Boeing 737 Max 8 leased by the airline and it touched down at the Piarco International airport, bearing registration 9Y-CAL.
The decision to continue the planned acquisition of the planes were questioned in 2019, after a recurring failure was found in the Manoeuvring Characteristics Augmentation System (MCAS) which caused two fatal accidents, Lion Air Flight 610 in October 2018 and Ethiopian Airlines Flight 302 in 2019.
The two crashes lead to a total of 346 people deaths and the grounding of the aircraft.
However after hundreds of tests, the aircraft was recertified for use in mid-2020.
Corporate communications manager for Caribbean Airlines, Dionne Ligoure said there were numerous benefits for the airline’s operations which would be realised by the transition to the Max 8 aircraft.
In an email to the Business Guardian she said there would be annual operating cost reduction, driven by savings on fuel and maintenance through the use of the aircraft.
The airline’s use of the Max 8 would also lead 16 per cent reduction in carbon emissions and fuel consumption.
Ligoure also pointed out, “40 per cent lower noise level compared to the 737-NGAs at November 23, 2021 the global (based on airlines operating all over the world) 737-8 fleet surpassed 600,000 total flight hours, averaging more than 1,300 flights a day.”
She said, “The aircraft is being prepared for induction and entry into service in 2022. These aircraft are leased specifically, operating leases and the total cost of ownership is less.”
She confirmed that pilots would also receive specialised training for the new planes. CAL’s corporate communications manager said, “Caribbean Airlines has worked with the regulators and Boeing, as well as our pilots, safety and maintenance teams to ensure the safe induction of the aircraft. All Boeing 737 pilots will complete the approved training, including computer-based training, classroom briefings and rigorous 737-8 simulator training before the aircraft is placed into service.”
Training would also be provided for maintenance staff as well, she said.
“Our maintenance engineers and technicians were trained by Boeing and certified by the independent regulators as approved to service the aircraft. Our cabin crews have also been fully trained on the aircraft type, to ensure that our customers continue to enjoy our authentic Caribbean service levels,” she said.
Overall, she explained it was simple and more cost efficient to introduce the Max 8 to Caribbean Airlines’ fleet.
“The aircraft which are operating leases, will be less costly to operate than the NG’s. Additionally, they have more seats and greater range, which along with the savings on fuel and maintenance will provide the opportunity for improved earnings,” she said. As for the airlines performance, since the reopening of borders and the resumption of routes out of T&T, Ligoure said there had been little change in terms of the projections the airline had seen and the interest in flights currently.
She said, “For September 2021, IATA reported ‘air travel picked up in September, after a slight deterioration in the previous month, but remained well below pre-crisis levels. Industry-wide revenue passenger-kilometres (RPKs) fell by 53 per cent compared with pre-crisis September 2019, vs a 56 per cent contraction in August.”
She continued, “In month-on-month terms, RPKs rose by 18 per cent—a robust improvement but from a very low base.”
The International Air Transport Association (IATA) report continued: No improvement in global international travel: “The contraction in global international RPKs stabilised in September, at -69 per cent below 2019 levels. Traffic developments were muted across all regions.”
T&T’s borders were reopened on July 17, 2021 after being closed since March 2020.
However, worldwide travel has still been on a go slow, as numerous countries have varying restrictions concerning entry and quarantine regulations, relating to vaccinated or unvaccinated entry.
The recent emergence of the Omicron variant of the coronavirus, has once again prompted several countries to impose restrictions on travel to and from specific countries.
The airline has in recent months added additional flights to routes or added new routes as it has attempted to navigate a trying period which it expects will persist into 2022, with hope that there would be improvement in 2023.
“Passenger demand globally, is suppressed and is expected to remain so for the next two to three years. In spite of the challenges, Caribbean Airlines is committed to its objective of connecting the region. Since the reopening of borders at its southern base in T&T, the airline has used a phased approach to reintroduce its commercial schedule. Alongside flights to its regular markets, some additions to the network include weekly service between Trinidad and Dominica and twice weekly service between Trinidad and Eugene F Correia, Georgetown, Ogle, Guyana,” she said.
“Also, by the end of 2021, the airline would have reintroduced service between Trinidad and Cuba, Jamaica, Suriname and a seasonal operation to Fort Lauderdale.
“Caribbean Airlines Cargo, which remained extremely active throughout the pandemic, now includes operations to Dominica, Barbados, St Vincent, Grenada, New York, Toronto and Miami,” said Ligoure.
She stressed that with the success of Caribbean Airlines Cargo, the airline was encouraged to increase capacity, which it did.
“Earlier this year, cargo capacity was increased to Kingston, Jamaica where all-cargo flights operate each Sunday, Tuesday and Thursday using a 767 aircraft. An additional all-cargo flight out of Trinidad every Monday was also launched,” she said.
Ligoure noted that while those increases do indicate some level of increased activity on that front, the airline is still navigating a difficult period as are much of the aviation sector. Earlier this year, the airline announced it had lost TT$326.6 million for the first half of this year.
The airline also announced that it had no choice but to retrench workers, with 450 workers initially expected to be sent home.
The airline confirmed its revenue fell by $2.2 billion in 2020, just a year after it recorded an operating profit of $76 million in 2019.
It was the second consecutive year the airline made a profit after it saw a $42 million profit in 2018 after consistently operating at a loss since 2011.