by Richard Coulson
I have often urged that our domestic airline routes be privatized, with Bahamasair sold off to an investor-owned company. Recent events show that privatization alone is not the answer for a successful airline business. Sky Bahamas is owned by Capt. Randy Butler and other Bahamians and now seems on the verge of collapse, an unhappy outcome for an airline that was always my favorite choice for Georgetown, Exuma, with three reliable daily round trips.
Capt. Butler puts the blame squarely on Government, pointing at unfair subsidized competition from Bahamasair, as well as wrongful suspension of essential operating license by the Civil Aviation Authority. But any impartial observer cannot avoid speculating about either extreme family misfortunes or bad management practices. The fleet has shrunk to two aircraft making fewer flights, with passenger complaints about delays and cancellations. The once key destination of Freeport was abandoned last year, although Sky’s competitor Western Air operates its principal hub there, with its own terminal facility. Further, Sky’s debt service obligations to Lynden Pindling International for landing fees and passenger charges are only partly paid.
As the continued license suspension has killed off operating revenue for several weeks, it’s hard to see how Sky can survive unless helped by “strategic investors”, who Capt. Butler claims are in negotiation. Any such result may not restore Sky as an independent operation, but leave it simply swallowed up as part of a bigger airline, possibly Western, as neither American nor Delta are likely interested in offering a bailout.
Government quite rightly will remain aloof from direct aid to Sky Bahamas’ owners but will want to see a solution giving fair employment to the trained pilots, flight attendants, ground crew, and mechanics who served Sky so well. And the decks will then be cleared for arranging a Bahamasair privatization using local capital and expertise.
First published in The Tribune, and is posted here with the kind permission of the author.
Mr. Coulson has had a long career in law, investment banking and private banking in New York, London, and Nassau, and now serves as director of several financial concerns and as a corporate financial consultant. He has recently released his autobiography, A Corkscrew Life: Adventures of a Travelling Financier.
