Monday, Jul 22, 2019
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Low passenger load factor continues to plague Bahamasair

Despite an increase in passenger counts, Bahamasair is still operating at cripplingly low cabin loads, which according to Minister of Tourism and Aviation Dionisio D’Aguilar will prevent the airline from breaking even unless something drastic is done.

Passenger counts at Bahamasair stood at 853,000 in 2018 and are expected to grow to 945,000 in 2019, the minister noted. Still, he said the load factor remains one of the biggest problems for the airline.

“The load factors are still relatively low at 60 percent and in order to break even we’d have to get it to 80 percent,” D’Aguilar told reporters before the weekly Cabinet meeting at the Churchill Building Tuesday.

“So, I’ve challenged Bahamasair to see what we have to do to get our load factors up. It is kind of difficult because Bahamasair has a commitment to the Bahamian people to do certain routes and not all of those routes yield high occupancy levels.”

This comes as Bahamasair has projected that its annual net loss will decrease from $24 million in 2018 to $21.9 million in 2019, and decrease even more to $16.9 million in 2020.

“Bahamasair has lost money every single year since it’s been in operation, we’re trying to mitigate that,” D’Aguilar said.

 Another issue affecting the airline’s bottom line is higher global fuel prices, the minister said.

“Bahamasair obviously is challenged every time fuel prices go up. In many instances the tickets, especially domestically, are fixed, so this becomes a real challenge for Bahamasair in terms of minimizing losses,” he said.

“I don’t really know what the solution is in terms of how to address that, because we have a commitment to the Bahamian people to maintain the prices domestically.

“Domestically the prices are fixed, internationally we are really driven by our competitors, so you have to look and see what your competitors are doing and what they’re pricing at. You can’t be out there in left field saying it costs me this much to run the airline, so therefore I’m going to charge this ticket, not taking into consideration what your competitors are doing.”

The government increased its subsidy to Bahamasair for the 2019/2020 fiscal year to $22.4 million, up from the $13.4 million this fiscal year.
 

 

Paige McCartney

Business Reporter at The Nassau Guardian
Paige joined The Nassau Guardian in 2010 as a television news reporter and anchor. She has covered countless political and social events that have impacted the lives of Bahamians and changed the trajectory of The Bahamas.
Paige started working as a business reporter in August 2016.
Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News
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