Turks and Caicos InterCaribbean Airline on Dec. 17 launches new flights to Guyana with service between Georgetown and Barbados to replace LIAT

Impact of Covid 19 on the Aviation Industry

The devastating and unprecedented impacts of Covid 19 pandemic on the aviation industry cannot be over-emphasized. The emergence of this global emergency saw numerous countries shutting down their borders in response to its arrival.

This was subsequently followed by the introduction of multiple restrictions and regulations that limited the free movement of individuals in an attempt to curb the spread of the virus. Thus, overall air transport market and the airport sectors in particular are among the worse-hit industries due to its global nature.

March 2020, came as a game-changer, when an overwhelming majority of national governments implemented strict confinement measures which eventually resulted in what the IMF termed the “Great Lockdown”— which is the worst economic downturn since the Great Depression of the 1920s. Consequently, the outbreak resulted in fundamental drastic changes in the dynamics of all the demand and supply parameters for air transportation as well as airport infrastructure and services.

Besides the travel bans set up by countries globally, people’s reluctance to travel during a global pandemic has had a damaging impact on the aviation and tourism sectors. Tourists are more likely to postpone or cancel their travel plans in order to minimise the risk of becoming infected.

Air traffic is the lifeblood of the airport business. Therefore, as traffic declines, airports’ ability to collect charges decreases proportionally. As airports have little flexibility in operating expenditures but also have capital costs that are largely fixed, the current crisis represents an unprecedented challenge for the airport industry’s financial viability and business continuity.

About InterCaribbean

Previously known as Air Turks & Caicos, interCaribbean Airways is a Turks and Caicos-based passenger airline that operates from a hub at Providenciales International Airport. It is the national airline of The Turks & Caicos Islands.

Since inception, the Founder and Chairman, Mr. Lyndon Gardiner a Turks & Caicos Islander, opined that interCaribbean has been aggressively broadening its scope across the region in the last decade.

In commenting on the actualization of his vision to become a household name in Caribbean travel, Founder and Chairman, Mr. Gardiner, states, “Building interCaribbean into what it is today has taken the full dedication of my entire team. The direction of the last 10 years culminates in introducing these new services to deliver a Caribbean-born and grown airline and become a leader in the region.

It is my desire that every budding entrepreneur follows their calling and works towards their dreams. I did not start out imagining what we have become today, but continually calibrated and maximized every potential opportunity to grow this company. Our goal now is to fully consolidate ourselves in the region and become a globally recognized brand.”

The CEO, Mr. Trevor Sadler, further stated that ‘the Chairman long held a vision for a connected Caribbean, and with this launch connecting our presence in the Eastern Caribbean, the vision is being realized’.

The airline offers scheduled domestic and regional services from its hub at Providenciales, Turks & Caicos and Tortola, British Virgin Islands, to multiple destinations. The airline was launched in 1991 as a charter airline under the name Interisland Airways but became fully operational by 1999.

In 2003, the airline entered scheduled services and rebranded as Air Turks & Caicos. Ten years later (in 2013), in order to reflect its intention to offer flights across the Caribbean, the airline rebranded again to interCaribbean Airways, as it is to date. Following the Coronavirus pandemic in 2020, the airline is looking forwards to welcoming travellers back to the Caribbean once again, and is committed to the safety of its passengers.

InterCaribbean Airways serves about 27 destinations in 15 countries across the Caribbean skies. In June 2019 it added the larger and faster Embraer EMB145 Regional Jet aircraft to its fleet, increasing its passenger and direct flight capabilities.

In addition to the EMB145 Regional Jets, the airline currently operates eight 30 passenger Embraer E120, one 18 passenger executive Embraer 120 aircraft all equipped with lavatories, a galley and flight attendant service.

InterCaribbean Airways is the leading regional airline serving intra Caribbean flights to more destinations across the Caribbean islands than any other airline.

Visit interCaribbean.com to learn more about the company and its operations.

About LIAT:

LIAT Ltd, also known as Leeward Islands Air Transport Services and operating as LIAT, is a regional airline headquartered in Antigua and Barbuda that operated high-frequency inter-island scheduled services to 15 destinations in the Caribbean. The airline’s main base was V.C.

LIAT was Founded by the late Kittician, now (Sir Frank Delisle) in 1956 and began flying with a single Piper Apache operating between Antigua and Montserrat. With the acquisition in 1957 of 75 percent of the airline by the larger, better known BWIA, LIAT was able to expand to other Caribbean destinations and to obtain new aircraft types, such as the Beechcraft Bonanza and de Havilland Heron.

Hawker Siddeley HS 748s later came in 1965, due to the airline’s decision to phase out the Herons. In 1968, LIAT was operating some flights via an agreement with Eastern Air Lines to provide passenger feed at its U.S. based air carrier’s hub in San Juan, Puerto Rico and was flying “Eastern Partner” service between San Juan and Antigua, St. Kitts and St. Maarten.

LIAT grew exponentially in the 1980s and by 1986, many daily flights were operated to Luis Muñoz Marín International Airport in San Juan, Puerto Rico, as well as other regions that the airline had never flown to. Faster de Havilland Canada DHC-8-100 Dash 8 turboprops were acquired in order to reduce flight times systemwide.

In November 1995, LIAT was partially privatized, to save it from bankruptcy once again. LIAT also began operating the larger 50-seater de Havilland Canada DHC-8–300 Dash 8 turboprop.

In June 2013, LIAT received its first ATR 72 series 600 aircraft (registration V2-LIA). The airline completed its transition from the Dash 8 fleet to an all-ATR fleet in 2016.

LIAT, The Caribbean Airline, operates a modern fleet of ATR 42 and ATR 72 aircraft across a regional network of 18 destinations. It is owned by regional shareholders, with the majority being the Governments of Barbados, Antigua & Barbuda and St. Vincent & the Grenadines.

What happened to LIAT airlines?

LIAT, The Caribbean Airline is currently under Administration and is restructuring to better serve the Caribbean. The Administrator is Mr Cleveland Seaforth of BDO Antigua and Barbuda. LIAT suspended its operations in March 2020 after many Caribbean islands shut down their airports as part of measures to curb the spread of COVID-19.

The airline owed creditors in excess of XCD100 million East Caribbean dollars (USD27 million). In view of the increased debt and the economic impact from the pandemic, LIAT in July received a stay from liquidation when the government of Antigua and Barbuda secured an order for its administration.

On 27 June 2020, the Antiguan prime minister Gaston Browne announced that LIAT would be liquidated following increased debt and the economic impact of the COVID-19 pandemic. The airline will be reformed into a new entity which will continue to provide connections between the Caribbean islands.

The struggling Caribbean airline is working to rebuild its network after suspending all flights in March 2020 as it sought protection from creditors. According to the Prime Minister, the current LIAT will be replaced with a much leaner LIAT that will retain the LIAT brand.

The CEO noted that the airline’s Management and Board of Directors will continue to monitor the situation and will review the decision in July as more information becomes available. The airline acknowledged that while the extension was extremely difficult, it was necessary as the airline works towards a feasible restart.

“COVID would have actually, let’s say, increased the losses exponentially, so whereas in all of 2019, LIAT made a loss of about XCD12 million Eastern Caribbean dollars (USD4.44 million), that was within the means of the shareholder governments to subsidize,” Browne said.

With most Caribbean Island states having closed their respective borders to international commercial traffic, LIAT’s operations have been severely curtailed. To make matters worse, it has still had to make leasing payments on two of its five ATR42-600s and all five of its ATR72-600s.

“You would have found that since COVID, the planes have been grounded, they have to pay the lease payments and they are not getting any revenue,” he added.

LIAT’s shareholders include; 11 Caribbean states of which Barbados, Antigua & Barbuda, Dominica, and St. Vincent & the Grenadines are the largest while the remainder – Guyana, Jamaica, St. Kitts & Nevis, Montserrat, St. Lucia, Trinidad & Tobago, and Grenada – holds minority stakes alongside various banks and labour unions.

Browne said that during an upcoming shareholders meeting, while a vote would have to be taken in favour of winding down the airline, a similar one – albeit focussing on establishing a new replacement carrier – would have to follow shortly after to ensure connectivity among the islands.

“A decision will have to be made to collapse it and then maybe the countries within the region will have to come together to form a new entity,” Browne added. “Back in 1974, when LIAT 1974 Ltd was collapsed, my understanding is that it took a day to start the operation of a new entity.”

“It may be a little more difficult to get it done within 24 hours, and I do understand that there are a number of stakeholders that we have to satisfy, especially creditors, and I believe that we could do a work out with the various creditors and to literally get some arrangement in which they can accept that we are not conveniently closing LIAT 1974 Ltd. The governments cannot go any further with it.”

Browne conceded that creditors, which include staff and lessors, among others, would have to accept that their claims will have to be reduced if a new carrier is to be borne.

“And these creditors, including the staff of LIAT, have to understand that there will have to be some level of cooperation to include possibly some cuts on their liabilities in order to facilitate the creation of a new, viable and sustainable entity,” he said.

Its restructuring plan requires a re-investment of XCD108 million (USD39.9 million), with the Antigua and Barbuda government prepared to underwrite up to 50% of the required recapitalisation. The remaining XCD54 million (USD19.9 million) is to be raised from the private and public sectors.

As part of the process, the governments of Barbados and Saint Vincent and the Grenadines agreed to sell their shares to Antigua. In August, Browne reported interest from other regional airlines and governments, as well as an unnamed entity from Africa. And at the same time, the airline’s administrator temporarily laid off about a quarter of its remaining 166 employees.

interCaribbean new Flight services with new Aircrafts

interCaribbean Airways is the leading regional airline serving intra Caribbean flights to more destinations across the Caribbean islands than any other airline.

As the Caribbean aviation industry wobbles back to normalcy following Covid-19 recession, interCaribbean Airways has now fully replaced its bankrupt rival LIAT, to fill the market gap.

The Turks and Caicos Islands-based interCaribbean hit the headlines throughout the region last month when it launched weekly flights between Barbados and Guyana, a route which was originally served by LIAT.

Besides Guyana, interCaribbean now also operates twice-weekly flights between Barbados and Antigua including, the country where LIAT head office is based.

LIAT went into administration as its debt skyrocketed amid the curfews and lockdowns imposed in response to the COVID-19 pandemic. On 27 June 2020, the Antiguan government announced that it would liquidate LIAT’s assets as it reportedly owes US$27 million to creditors.

As the region’s tourism industry resumes full operation, interCaribbean is phasing out its legacy small aircrafts and acquiring LIAT’s ATR 42 passenger planes. The new aircrafts provide significantly more passenger and baggage room on board as well as hiring LIAT’s pilots.

Most of its flights are scheduled in a way that passengers can catch British Airways and Virgin flights bound to faraway destinations.

The new connections consolidate the growth of InterCaribbean in the region giving for the first time a truly Caribbean integration with interCaribbean services connecting Havana to the West, Antigua and Barbados to the East, and now new services South to Guyana.

The service includes a total of 12 weekly flights between Barbados and Georgetown including connecting flights to St Vincent, Antigua, Grenada, Dominica and Saint Lucia.

An onward flight via Barbados to Antigua will continue to Turks and Caicos and then head to Havana.

“With the open-for-business efforts of this government, we were able to put everything in place, and we are here to make the announcement, and make the service a reality from December 17th,” said interCaribbean Founder and Chairman Lyndon Gardiner.

Minister of Public Works, Juan A. Edghill welcomed the airline to the Guyana market at a ceremony hosted at Dukes Lodge in Georgetown on November 5th, 2021.

Minister Edghill said there is insufficient connectivity between Guyana and the rest of the Caribbean, and the Guyana government is therefore pleased with the additional airline joining its friendly skies.

InterCaribbean is phasing out its legacy small aircrafts, acquiring LIAT’s ATR 42 passenger planes and is hiring LIAT’s pilots. The new aircrafts provide significantly more passenger and bag is hiring LIAT’s pilots age room on board.

The carrier is known for connecting passenger services. In other words, most of its flights are scheduled so that passengers can catch British Airways and Virgin flights bound to distant destinations.

Thus, interCaribbean now operates ERJ145 48 seat jets, EMB 120 30 seat Turbo aircraft, and now ATR42 48 seat aircraft connecting the Turks & Caicos Islands, Antigua, The British Virgin Islands, Puerto Rico, The Dominican Republic, Cuba, Haiti, Guyana, Jamaica, The Bahamas, Barbados, Dominica, St Lucia, St Vincent and the Grenadines, Grenada and St. Maarten. Domestic flights are operated in The Turks & Caicos Islands.