Trinidad-based Caribbean Airlines is planning a major restructuring as the pandemic decimates revenues. The carrier is planning to cut its workforce by 25% and reduce its 17-strong fleet. The decision comes on the back of another major loss for the airline, forcing long-term changes. Let’s find out more.
According to Newsroom, Caribbean Airlines is planning a major shake-up in the wake of weak first-quarter results. The airline, which is the flag carrier of Trinidad and Tobago, Jamaica, and Guyana, saw its revenues fall by a massive 75% during Q1 of 2021. This resulted in a loss of TT$172.7mn ($25.4 million) for the quarter, aided by steep cost cuts made in the last year.
However, Caribbean Airlines is now preparing for its post-pandemic new normal. To this end, the carrier will cut around 450 jobs, which represent 25% of its overall workforce. Several planes could be also be leaving the fleet, although the exact number remains unknown. Moreover, the carrier’s route map could be shrinking too, as it looks to exit unprofitable markets.
In a statement about the upcoming restructuring, the airline said,
“These steps include major cost reductions in all areas of the airline’s operations, specifically its human resource complement, its fleet and other assets, and its route network…Since the beginning of the COVID-19 pandemic and the suspension of operations at its base in Trinidad and Tobago, the airline has seen passenger numbers plummet, and flight numbers reduced to less than 10% of normal operation.”
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Caribbean Airlines operates a fleet of 17 aircraft, consisting of seven ATR 72s and 10 Boeing 737-800s, according to ch-aviation. While the turboprops make short-haul journeys between neighboring islands, the 737s are responsible for short- and medium-haul routes to the US, Canada, and other popular destinations in the US.
Currently, four planes remain parked, three 737s and one ATR 72s. These are some of the oldest in the fleet, the narrowbodies being over 21 years old and the ATR almost 10 years old. These four aircraft could be the ones returning to lessors, although more details are yet to emerge.
Not coming back
Even though Caribbean Airlines has expressed support for Trinidad and Tobago’s decision to reopen its border, it doesn’t expect to see aviation traffic bounce back to pre-pandemic levels in the short term. This is in line with estimates from other experts, who only expect to see travel reach 2019 traffic by 2024 for international flights.
For the Caribbean region, air traffic is critical for social and economic reasons. If tourists don’t return, job losses and shutdowns in the tourism industry will continue to mount. However, as borders begin to reopen, there seems to be a chance at a modest recovery in the coming months and years.
What do you think about the future of Caribbean Airlines? Let us know in the comments!