Fa­mous for its short, maxi-taxi style hops be­tween Caribbean is­lands, LI­AT (1974) was in many ways the back­bone of re­gion­al trav­el for decades. But on Jan­u­ary 24, 2024, LI­AT (1974) ceased op­er­a­tions, des­tined to be for­ev­er re­mem­bered as the “Leave Is­land Any Time” air­line.

Fast for­ward to Au­gust 6, 2024, and a new air­line would take to the skies. LI­AT20, a com­plete­ly new en­ti­ty with new man­age­ment, was on a mis­sion: con­nect the North­ern and South­ern Caribbean. Its ex­pan­sion was ag­gres­sive, the man­age­ment team seek­ing to re­claim some of the old LI­AT (1974) routes be­fore oth­ers could es­tab­lish them­selves in the var­i­ous mar­kets.

By De­cem­ber 2024, LI­AT20’s in­au­gur­al flight to Port-of-Spain was on the ground, the 12th des­ti­na­tion in the air­line’s net­work. Kingston, Ja­maica, would soon fol­low, along with talks of link­ing Be­lize, Pana­ma, Colom­bia, and Suri­name.

Two years and one re­brand­ing ex­er­cise lat­er, Li­at Air, as it is now called, is start­ing to see the re­sults of its am­bi­tious plans. In an ex­clu­sive in­ter­view with Busi­ness Guardian, CEO Haf­sah Ab­dul­salam said the num­bers are en­cour­ag­ing.

“Gen­er­al­ly, op­er­at­ing for just about a year, we’re just shy of the 60 per cent net­work load fac­tor. And we’re see­ing that grow­ing as well. We’re al­ready see­ing a year-on-year com­par­i­son, we’re al­ready see­ing num­bers that are well over 100 per cent. So, by year-end, we def­i­nite­ly would have, if not hit, at least ex­ceed­ed our tar­gets,” she said.

An av­er­age load fac­tor north of 70 per cent is de­sir­able in the avi­a­tion in­dus­try be­cause it means the air­line is at least break­ing even. Above 85 per cent, and the air­line is in prof­it-gen­er­at­ing ter­ri­to­ry.”

The num­bers, while not ide­al, are al­so en­cour­ag­ing for Li­at Air’s Trinidad ser­vice, with a load fac­tor of ap­prox­i­mate­ly 50 per cent. Li­at Air cur­rent­ly flies non-stop be­tween An­tigua and Trinidad, and di­rect via St Vin­cent and Grena­da. Ab­dul­salam ex­plained that some of the ini­tial chal­lenges the car­ri­er faced when en­ter­ing the T&T mar­ket cen­tred around trav­el agents’ abil­i­ty to ac­cept pay­ments, as they faced cur­ren­cy re­stric­tions.

“Our mode of sales was di­rect­ly through us. As a knock-on [ef­fect], it af­fect­ed the pas­sen­ger num­bers com­ing through,” said the air­line ex­ec­u­tive.

To solve that prob­lem, Li­at Air was in­te­grat­ed in­to the ma­jor Glob­al Dis­tri­b­u­tion Sys­tems (GDSs) three weeks ago. A GDS is a sys­tem used by both trav­el agen­cies and trav­el ser­vice providers. It en­ables au­to­mat­ed trans­ac­tions and pro­vides re­al-time in­ven­to­ry and pric­ing. The re­sult? An uptick in book­ings.

The lack of forex is just one of many chal­lenges air­lines face when op­er­at­ing in the Caribbean. As a Niger­ian com­ing from out­side the re­gion, Ab­dul­salam lament­ed how much tax­es af­fect the fi­nal tick­et price.

Ac­cord­ing to a 2015 Caribbean De­vel­op­ment Bank “Mak­ing Air Trans­port Work Bet­ter for the Caribbean” re­port, gov­ern­ment fees and tax­es on a typ­i­cal re­gion­al plane tick­et range from 30 to 50 per cent of the fi­nal price. In Latin Amer­i­ca, the fig­ure is clos­er to 20 per cent. Ab­dul­salam un­der­stands that tax­es and fees gen­er­ate rev­enue for Caribbean gov­ern­ments.

“Every is­land has got their pri­or­i­ties for what and how they want to dri­ve rev­enues. So, you can’t ar­gue with that. I would rather it wasn’t there be­cause we feel that with low­er tax­es, it means the price point for per­sons with­in the re­gion is much low­er,” she said, adding that, “I’ve seen some of the re­gion­al gov­ern­ments take some in­de­pen­dent moves, if you like, for their des­ti­na­tions. And we wel­come that. There have been loads of stud­ies done on this. It’s noth­ing new, you know. We all know. It’s just that will to go to that next step to make it hap­pen.”

High tax­a­tion can stymie a car­ri­er’s growth, and the so­lu­tion may just lie in what Ab­dul­salam calls co-opet­ing; a “fu­sion of col­lab­o­rat­ing and com­pet­ing” at the same time. She ar­gues that if air­lines were to ap­proach gov­ern­ments with one voice, it would car­ry more weight.

Co-opet­ing al­so ex­tends be­yond lob­by­ing gov­ern­ments to re­duce tax­es. It al­so means agree­ing to work to­geth­er to con­nect dif­fer­ent parts of the re­gion and in­crease air­lift. Li­at Air re­cent­ly an­nounced an in­ter­line part­ner­ship with Suri­name Air­ways. It is al­so in dis­cus­sions with lo­cal car­ri­er Caribbean Air­lines, though Ab­dul­salam was quick to point out that those dis­cus­sions were in the ear­ly stages.

Ac­cord­ing to an ASM in­tra-Caribbean air­lift study, seat ca­pac­i­ty in the re­gion has fall­en by 8 per cent from 2011 to 2025, large­ly in part to the clo­sure of LI­AT (1974) Ltd. How­ev­er, as oth­er car­ri­ers such as Winair, in­ter­Caribbean Air­ways, and Caribbean Air­lines rushed to fill that void, con­nec­tiv­i­ty in the re­gion has grown by four per cent. Li­at Air is fo­cus­ing on its ex­ist­ing routes, which cur­rent­ly con­nect 13 ma­jor des­ti­na­tions across the Caribbean.

“Li­at Air does fly to Ja­maica. We fly to Tor­to­la, Do­mini­can Re­pub­lic, St Mar­tin, St Kitts, An­tigua, Do­mini­ca, St Vin­cent, Grena­da, Bar­ba­dos, St Lu­cia, Guyana, and Trinidad. At the mo­ment, the fo­cus is to con­sol­i­date our re­gion­al op­er­a­tion, in­crease the fre­quen­cies, (and) pro­vide more op­tions,” Ab­dul­salam said.

That be­ing said, ex­pan­sion is not on the back burn­er. On May 1, Guade­loupe will be added to Li­at Air’s net­work. But with the Or­gan­i­sa­tion of East­ern Caribbean States (OECS) still with­out cat­e­go­ry 1 sta­tus, the air­line is ef­fec­tive­ly blocked from start­ing flights to US ter­ri­to­ries like the US Vir­gin Is­lands and Puer­to Ri­co be­cause the re­gion­al reg­u­la­to­ry body does not yet meet the FAA’s high­est safe­ty over­sight rat­ing.

“We’re hope­ful it’s go­ing to be this year,” Ab­dusalam says, re­gard­ing the sta­tus up­grade, though she prag­mat­i­cal­ly ad­mits it could be next year as well. In­stead, the car­ri­er is look­ing south to tap in­to a rise in de­mand from Latin Amer­i­ca, start­ing with Carta­ge­na, Colom­bia.

The air­line us­es a mixed fleet of ATRs and ERJ-145 jets and hopes to in­tro­duce a big­ger nar­row­body jet in the fu­ture. Whether the air­line can fill the seats con­sis­tent­ly is a dif­fer­ent mat­ter. How­ev­er, Ab­dul­salam is con­fi­dent that the air­line will see growth once pas­sen­gers give Li­at Air a chance, and so her fo­cus is on mar­ket share for now, not prof­itabil­i­ty.

“We have a fan­tas­tic air­line. We have fan­tas­tic ser­vice. The qual­i­ty of our ser­vice, I lay bold to say, it’s bet­ter than what you’ll find in the re­gion. Prof­it will come.”