Exploratory talks were held in Anguilla on Tuesday, November 11, between public and private sector representatives and a representative from the Puerto Rico-based Seaborne Airlines about possible scheduled air services to the island.
The talks were led by Mr Ben Munson, Vice President, Airline and Airport Services, who was introduced by Mr Haydn Hughes, Parliamentary Secretary, Tourism. Mr Munson, who presented an initial proposal, is expected to submit a formal one to the Anguilla Government for further discussion with the hotel and tourism sector probably within a fortnight.
Seaborne Airlines operates a fleet of domestic seaplane and landplane carriers from Puerto Rico. The company has scheduled flights to the US Virgin Islands, BVI, the Dominican Republic, Dominica, St Kitts and the French West Indies. Seaborne is now considering adding Anguilla to its list of landplane destinations, with plans to use a 34-seater aircraft to fly to the island on Mondays, Wednesdays and Saturdays.
Mr Munson told representatives of the Tourism Board, the Hotel and Tourism Association and a group of small property owners/operators, that the annual operating cost of the air service to Anguilla would be US$750, 000. Further, in order that there could be a profitable operation of Seaborne Airlines, the Anguilla private sector would be required to come up with a guaranteed minimum revenue provision sum of US$500,000 in the first year. While the Anguilla Government would facilitate the operation of the airline, the understanding is that the Government would not be in a position to assist in contributing to the airline’s revenue guarantee.
This would be a similar arrangement to one which the private sector entered into with the American Eagle some years ago. The departure of that American Airlines-operated service from Anguilla, and other islands, has created a window of opportunity for the provision of connecting flights, at the San Juan hub, for such carriers as Seaborne Airlines in collaboration with its partners.
The proposal was the subject of much discussion between Mr Munson on behalf of the airline, and the Anguilla hotel and tourism representatives who are waiting to see Seaborne’s forthcoming written offer.
Mr Munson told media representatives that the proposed air service to Anguilla was targeted for the first half of 2015. The airline would be, in his words, “providing connections to the multiple partners that Seaborne has in San Juan”.
He acknowledged, however, that there was “a mix of islands that we serve whether or not they have revenue guarantees or no guarantees in place.” He added that taking into consideration Seaborne’s operational annual cost to Anguilla of US$750,000, “the desired guarantee for the first year of service would be 500,000 and then it would go down to zero by year three.”
Mr Keithley Lake, President of the Anguilla Chamber of Commerce and Industry, told the media representatives that while the Government could not legally be involved in the revenue guarantee, it could provide support in a number of ways to reduce the burden on the private sector. “We will have to see what the written proposal is going to be so that we, as a group, and all the different stakeholders, can sit down and try to get the best deal for Anguilla,” the Anguillian Attorney-at-Law said.
The Chamber President thought there would not be any difficulty in Anguilla filling up a 34-seater aircraft. “The problem, however, is that the schedule needs to be adjusted,” he added: “If Anguillians can go to Puerto Rico and come back the same day, I think you would see a big difference in this problem.”
Mr Delroy Lake, President of the Anguilla Hotel and Tourism Association, commented to the media that “air access has been probably the most discussed topic in tourism over the past four years, as it is a necessity to Anguilla.” He said it was possible for the private sector to be able to provide the necessary revenue guarantee for Seaborne to operate in Anguilla.
Mr Lake added: “Unfortunately, missing from this meeting are the four top players, but we have already started to engage them. They are Viceroy, Cap Juluca, CuisinArt and Malliouhana – and access to Anguilla is important to them.”
Mr Hadyn Hughes, Parliamentary Secretary, Tourism, told the reporters: “The meeting was convened by me so that we could have direct face-to-face discussions with the Vice President of Seaborne Airlines and the industry partners. A number of these airline companies seek minimum revenue guarantees, and as a Government we cannot engage into minimum revenue guarantees.”
Mr Hughes recalled that in the past the private sector had indicated that it would be inclined to enter into minimum revenue guarantees with airlines. He said, however, that it was accepted that such a course of action would depend on the routes and schedules providing the best opportunities for the Anguillian market.
The questions to be answered are whether the Anguilla private sector will provide the required revenue guarantee of US$500,000 to ensure Seaborne Airlines’ proposed flights to the island, and whether the frequency of the scheduled service is in the island’s best interests.
