Shelley Harris
Saturday, October 2, 2021
In 2010 there was no commercial or economic case for the Twin Otter acquisition. There were not nearly enough passengers (15,000 total arrivals) to make it a viable business and no lender would give a commercial loan with the returns that were forecast but the intention was that with a very large subsidy for years to come the Airline would eventually break even.
- Fly MontserratMontserrat Airways would like to re-open the debate on access policy with some corrections of the misinformation that has been circulating so that its position is clear - the Company wishes to support the island in its economic development, and it has nothing against Twin Otters as long as it is the right Twin Otter and there is financial support for an operation. The time is right for a re-look at the access policy. With passenger numbers so low there is no pressure and plenty of time to plan.
There have been many comments that Nigel Harris and FlyMontserrat promised to get a Twin Otter. This relates to policy back in 2009 when the Airline and the Montserrat Development Corporation (MDC) signed a Memorandum of Understanding (MOU) in which the MDC invested in Montserrat Airways and the funding would be used to procure a Computer Reservations System for scheduled services. This was accomplished and MDC became a shareholder. The MOU also agreed that a second investment from the MDC would follow in 2010 to enable the Airline to acquire a Twin Otter.
At the time Winair was being heavily subsidised by the Government of Montserrat for its route Antigua to Montserrat as well as FlyMontserrat receiving a more modest sum for its Islanders. Arrivals by sea at the time were only 2,000 per year.
In 2010 there was no commercial or economic case for the Twin Otter acquisition. There were not nearly enough passengers (15,000 total arrivals) to make it a viable business and no lender would give a commercial loan with the returns that were forecast but the intention was that with a very large subsidy for years to come the Airline would eventually break even.
In 2010 the number of passengers was declining further. And it was ashing which adversely affects turbine aircraft (Twin Otters) more than piston aircraft. It was agreed to delay the second part of the MOU with policy switching to a ferry and the second investment from MDC for the Twin Otter project never happened.
We reconfirm our position that there is no economic sense in having a Twin Otter because it will need massive subsidy but if there is the political will and the Government can financially support the operation, so it breaks even, then we are happy to run it. Nothing has changed there.
With total passenger arrivals in 2019 at about 20,000 there were still no-where near enough passengers for a viable Twin Otter service. With arrivals in 2020 at 6,000 and for 2021 expected to be about 3,000 there aren’t enough for the Islanders. However, it is an opportune time to re-open the discussion, so a plan is in place for when numbers improve.
