More LIAT job cuts coming following closure of POS office; unprofitable routes to go

LIAT said on Tuesday it will cut unprofitable routes if some countries refuse to give the airline the kind of assistance they offer to foreign carriers. And the airline also confirmed that more jobs cuts are coming.

Chairman Dr Jean Holder made the comments in St Vincent following a shareholders' meeting to discuss the airline's balance sheet and future operations attended by the prime ministers of St Vincent, Barbados and Antigua.

LIAT is projecting a loss of US$1.5 million for 2010 and has hinted of job cuts. The trimming started in Trinidad and Tobago last week when the airline shut down its offices in Port of Spain and advised customers to go to its website or to travel agents for assistance.

Holder did not confirm media reports that further staff reductions are coming. However he gave strong hints that it cannot be business as usual.

“Nobody wants to lay off staff...It’s the most painful thing for those who manage a company, but at the same time we cannot operate with a complement of staff which is in excess of what the company needs,” he said.

Prime Minister Gonsalves of St Vincent, who chaired the meeting, told reporters LIAT could save up to US$3 million a year by closing city ticketing offices across the region, as it did on January 28 in Trinidad.

He noted that it doesn't necessarily mean staff from those offices would lose their jobs. “You may be able to use staff in other parts of your operation, say at the airport."

He added, "Some may be willing to go; some may have an interest in migrating, for instance; some may want to go off and study and they’d like to take their golden handshake, but you will save a lot of the fixed costs, so these are practical matters which any company would have to be looking at very seriously,” he said.

Commenting on the financial situation Holder said, “LIAT does have to address some cost-cutting issues if it’s going to survive in the face of upcoming competition.”

LIAT has complained that several countries provide revenue guarantees to foreign airlines that fly to the region, but have strongly resisted doing the same for the regional carrier.

“When we’ve done a cost benefit analysis of a particular service and it does not profit us, especially if the person is not a shareholder in the company, then we will not be able to continue that service without assistance,” the airline chairman said.

“So what I’m saying is that there’s going to be very much a new approach to how we do business in the region because the competition is coming and it’s coming heavy as far as we can see,” Holder added, noting that LIAT is engaged in a strategic planning process.

“We’ve had a number of proposals put on the table which suggest that LIAT cannot continue to do the same thing it has been doing forever and expect a different result...We’re discussing how to change this airline to do things like lowering the cost of travel and at the same time giving satisfaction and…staying in business,” he said.

Holder said the price of fuel has also been a problem for LIAT with a cost of more than US$100 a barrel in 2010.