Airline crisis could hurt CI

There is a danger that foreign air carriers could heavily reduce or cut service to these islands because of the aviation crisis, Minister for Tourism Charles Clifford has admitted.

‘We have constant dialogue with the foreign airlines serving Cayman and so we monitor that really closely and I think at this point they are very comfortable with their load factors, but of course this is an airline crisis,’ said the Minister.

The airline crisis, driven by crippling fuel costs, is seeing American Airlines reduce service out of its San Juan, Puerto Rico hub by 50 per cent, which will hinder tourism for the Eastern Caribbean. Fewer flights to Puerto Rico could also affect cruise tourism to the home port, making it harder for passengers to get there to start their cruise.

Other major airlines such as Continental and United have announced they are pulling planes and staff in a bid to tighten their operations. Continental Airlines just announced discontinuing service between its hubs and various cities, including international destinations.

The Minister noted a recent emergency Caribbean Tourism Organisation meeting he attended in Antigua on the airline crisis.

‘The presentation that we had in Antigua by the consultants hired by CTO was that this crisis is likely to last between four and five years and indeed the experts in the field have indicated that this is in fact the worst crisis the airline industry has seen in 30 years, so this is worse than 9/11 in their view.’

The situation is difficult to predict, but there is somewhat of a danger some of the foreign carriers could severely cut flights or pull service to Cayman, he said.

‘One thing that we do know is that because the global airline industry is in such a difficult position, it is critically important that we continue to support Cayman Airways and position Cayman Airways so that they can continue to guarantee reliable and affordable air transport to the Cayman Islands,’ he said.

The Minister noted that those other islands that don’t have national flag carriers are desperate at this point.

‘Their economies are going to be in serious trouble. They are doing what they can to mitigate against that, as they should, but it’s a very serious situation.’

And the flight cuts seem to be coming in the Eastern Caribbean despite a growth in tourism this year in islands such as Puerto Rico, St. Lucia and Antigua.

With airlines in the US cutting domestic flights and staff, it remains to be seen how flight cuts will progress and if the Cayman Islands’ air service by foreign carriers will be affected. For now, it appears that the foreign carriers that service these islands have not cut down on service here because of the airline crisis and none of them indicated following questions sent by email from the Caymanian Compass that they have immediate plans to do so. Some will cut service because of the slow season, which generally goes from May through November.

American Airlines has three flights a day between Grand Cayman and Miami and is planning to cut this to two flights soon because of the slow period, said spokesperson Minnette Velez.

British Airways offers a London/Grand Cayman service four times a week. Spokesperson Michele Kropf said they have not cut flights because of hurricane season, but they will be reviewing their capacity throughout their network for this winter.

Spirit Airlines has two non-stop flights per week between Grand Cayman and Fort Lauderdale. ‘Spirit has not announced or made any decisions regarding any system-wide capacity reductions. However, Spirit does plan to continue growing its operations in the Caribbean and Latin America and to remain the largest carrier at Fort Lauderdale,’ said spokesperson Misty Pinson.

And despite the downturn in the US economy, with less US residents expected to travel, a plus for the Cayman Islands, a high end tourist destination, is that industry experts, such as Christopher Hart, a professor at the Cornell University School of Hotel Administration, have said that wealthy travellers are still willing to travel to the Caribbean.

Immediate Past President of the Cayman Islands Tourism Association Karie Bergstrom noted earlier this year that as the US faces an economic downturn, the industry needs to be creative to attract visitors. But, she added that huge opportunities exist based on the weakened US dollar because Americans are not looking to European trips, but to the Caribbean where their dollar value hasn’t changed.

CITA recently advised that advanced bookings suggest relatively strong summer and fall seasons in 2008.

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