Bahamasair is burning through $3 million per month as it comes up on almost three months of being grounded because of the coronavirus (COVID-19) pandemic, the airline’s Chief Executive Officer Tracy Cooper told Guardian Business yesterday, adding that the airline will likely suffer a 15 to 20 percent reduction in revenue until fiscal year 2021/2022.
According to Cooper, the airline has earned no revenue since March, but has kept on staff and retained essential airline services while “accumulating more costs” with the “inability to pay for those costs”.
However, Bahamasair has begun assisting government with the repatriation of Bahamians stranded in the United States since this country’s lockdown measures began. Cooper said the airline is happy to be assisting with that exercise. The airline is awaiting government’s final move to open flights to the Family Islands.
Meantime, Cooper said the airline is considering what the new normal for the industry will be in the wake of COVID-19. He explained that while airlines are still considering protocols that could adhere with social distancing needs, the International Air Transport Association (IATA) has decided that airlines do not need to necessarily distance passengers given the makeup of the aircraft environment.
“Social distancing on an airplane has some challenges,” said Cooper.
“Even if we take out a seat between somebody, you’re only talking about a foot and a half.
“But the air movement around the aircraft goes from the ceiling to the floor and the air is constantly pushing down, as well as the air is constantly being filtered through HEPA (high-efficiency particulate air) filters and the movement of the airflow that is being pumped from the outside to the inside on a consistent basis doesn’t allow for the air to be stagnant.
“Therefore, the people sitting in the airplane and facing the seat in front of them and not really facing each other and the airflow going from the ceiling to the floor and the airflow is being filtered all the time, the airflow is actually being moved in and out of the airplane all the time; there isn’t as much consideration within the aviation industry that there needs to be as much social distancing as in the general public where the air is stagnant.”
Whereas airlines have been considering taking the middle seat out of their inventory, Cooper said at current pricing levels, most airlines would only break even using this strategy.
But, given the IATA’s recommendation, Cooper said airlines, globally, could possibly operate at their normal capacities.
According to Cooper, if airlines were to consider social distancing on aircraft, the cost of flights could increase by more than 30 percent.
He said he could not yet say what prices will look like from now until the end of the year.
However, he said it is his hope that Bahamasair’s essential routes to islands throughout The Bahamas will mean the airline will rebound sooner than other airlines.
“We’re hoping that our recovery is not as slow as others, but we are projecting a 15 to 20 percent reduction in revenue streams until the next fiscal year (2021/2022) until things start to normalize.
“Based on the new norm, we will have to adjust. If people are as hesitant to fly as they were before, it lends to the airline having to make decisions from its cost structures well as its revenue streams.”
Cooper said there have been only marginal increases in costs for the airline to prepare itself for business amid COVID-19.