Winair aircraft deal
to be finalised soon
AIRPORT--The sale and leaseback of aircraft of Windward Islands Airways International Winair is almost a done deal, said Managing Director Edwin Hodge on Tuesday.
So far the airline has received three engines from Canadian Company Unity Group, formerly Erwin Aero, and there are three more to go, said Hodge. Winair has to change five engines this year, but has no financial means to do so.
Winair is also in the process of selling two of its Twin Otters to the Canadians. Unity Group will buy the aircraft and take care of the engines. The third Twin Otter has already been leased. A fourth Twin Otter, currently in the hangar, will be refurbished and become operational in October.
Winair had no other choice than to lease engines and now also its aircraft to keep operations going, explained Hodge, clarifying Tuesday’s statement by chairman of Winair’s dismissed board Reinier Heere, who said the carrier had had to resort to this alternative when its owner, the Central Government, refused to make investments in the financially troubled company.
Hodge explained that Winair had managed to temporarily defer making costly investments to replace engines in the past by using the two engines from a Twin Otter aircraft that had almost reached the end of its economic life. When the need again surfaced for “new” engines, the company had no other options left.
“The engines had to be replaced and Winair has no money,” said Hodge, noting that one engine costs a minimum of US $270,000, excluding the freight and other costs. Weighing its options, Winair then moved to look into the lease of engines per hour. That option didn’t prove viable, as it also would have been too costly.
Winair then looked to the manufacturers of the Twin Otter engines, Pratt & Whitney, the company powering nearly half of the commercial aircraft in the world. Hodge said Pratt & Whitney was in principle willing to help investing in new engines. However, it wanted a guarantee from the Central Government. The latter said no. It was then that Winair had to turn to its last option: sell and lease back.
The developments have no effect on Winair’s daily operations, assured Hodge, who was cautiously optimistic about the summer traffic. “The figures are looking good, but it is too early to say if we will meet our budget or surpass it,” he said. Winair is bracing itself for the slow season that follows the summer months. September is traditionally the hardest month.
Heere confirmed that making a deal with the Canadians had been the only way to keep Winair in the air. He added that leasing engines was a very common practice internationally. He blamed the Central Government for not investing in the company.
Heere, on the board for more than 10 years and chairman for the past three years, also criticised the June 21 letter of Winair’s shareholder representative Minister Roland Duncan, in which he requested the board to immediately make their positions available.
Heere said members of the board, all working without financial compensation, had spent a lot of time and effort on the company. “We believe Winair is good for St. Maarten and a necessity for Saba and St. Eustatius,” he said in an interview from the Netherlands. He said the board had cut cost where possible and there had been discussions with various possible investors. “Without any cash injection, we managed to break even.”
Heere said he was especially “at a loss” where it concerned Duncan’s decision to seek an additional director to deal with the airline’s commercial/marketing aspect. “Winair has no more planes, no more routes available and already operates with a loss. With what money are they going to pay a next director?”
He said the board had even fired the financial director in the past because he was earning a “very high” salary, a burden the company couldn’t carry. He said that situation had been solved by giving the local chief of the administration more responsibility. Accountant Martin Hassink was hired on a part-time basis to help.
Heere said he would be responding to the Minister shortly. He thanked the board.
At least one board member, Marco London, expressed his concerns over the Minister’s decisions in Tuesday’s edition of The Daily Herald, as did a former trustee and chairman Michael Ferrier of the privatisation committee that Duncan dismantled.
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