MPs voted to give national carrier Cayman Airways an extra $13.3 million to “meet uncontrollable cost pressures and unexpected expenses”.
The request was tabled by the Ministry of Tourism and Trade Development and debated in the 30 June session of the Finance Committee as part of the $134 million in supplementary spending requests.
Increased costs
Deputy Premier and Minister for Tourism Gary Rutty told committee members that the $13.3 million requested was made up of various items including $5.3 million due to the increase in the cost of fuel, $2.3 million to fix an engine issue that saw one of the airline’s planes out of service for three months and $5.5 million due in part to increased ground handling and security costs, a rise in training costs and a rise in the cost of airline food.
The cost of cleaning the planes has also increased, said Rutty, and there were other one-off costs such as $250,000 to market the new Grand Cayman – Austin, Texas route, which launched in May.
On questioning by MPs, Rutty revealed that the airline’s income had remained broadly in line with the previous year, but a predicted rise for 2026 had not materialised, even with May being the highest ever May on record for Cayman Airways in revenue terms. In response to a question about the recently-axed Cuba route, Rutty said that the Havana flight had been operating at a 24% load factor, with just 30 to 40 passengers, with the airline making a $2,000 loss on each journey.
Opposition Deputy Leader Kenneth Bryan questioned why the airline’s board was asking for more money to cover a shortfall in predicted revenues in the first quarter, when there was the rest of the year yet to come, and given May in particular’s strong performance.
“Why are you asking for more money for the first quarter when you have the rest of the three quarters left of the year, and your team is now saying to you [that] you had the best record in Cayman Airways history in May in making money?” he said, adding later, “I’m here to make sure that the government’s finances are reasonably being requested.”
Independent MP for Bodden Town West Chris Saunders joined the debate to say, “We know that even if you have record revenues in May, it does not translate to record profits. All it means is that you’re just losing less money in that month because pretty much Cayman Airways loses money every single month.”
Subsidy need
Saunders added, “We knew coming in last year, when we saw the budget, Cayman Airways did not get sufficient funds to start this year in terms of the subsidy, we knew that. So frankly I expected you to come for more money … but I guess it is still early in the year, and we’ll see what is happening. At a minimum we just need to get the public to understand that the days of making money on transportation in airlines in the Americas is over. It’s not happening anymore.”
In response, Rutty said that there had been an 83% increase in fuel costs, which had not been budgeted for. He said that the airline was currently working on ways to increase revenue, including launching its own rewards loyalty programme and credit card, adding, “Cayman Airways is such a valuable asset … and I know that whatever we can do to make it more affordable for the people of this country, we will do.”
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