The Caribbean Needs Interline Agreements, Not More Fishermen

Following the pandemic, and the shutdown of the 1974 iteration of LIAT, available seating capacity within the Caribbean aviation sector grew rapidly, with a number of regional carriers announcing new routes and filling the void left by other operators. Fast forward a few years later, and we are already seeing the first victims of this over-expansion.

Over the past two years, regional carriers have been forced to revisit their schedules, reducing capacity across the board. Of all the brands, Caribbean Airlines was forced to make the biggest changes, announcing sweeping route cuts and reductions across its network following poor financial performance.

Looking back, when some of these routes were announced, I really wondered what was their rationale behind them. Were airlines simply trying to fill the void left by old LIAT? Were they shooting darts at a map? Or did they know something we did not?

Focusing again on Caribbean Airlines, some of the routes they targeted ended up being serviced by up to four competing airlines. Sounds great, right? The real-world numbers said otherwise as some of the carriers struggled badly to fill seats on these flights.

Realistically, travel within the Caribbean is a very complex issue. For starters, taxes and fees contribute anywhere from 30 to 50% of ticket prices. For example, a one-way flight from Barbados to Dominica costs almost as much as a one-way flight from Barbados to Miami. Even after decades of complaining, there has been very little done to make travel within the region more affordable.

Can more be done to reduce the cost? Maybe? On the flip side, it’s hard to make a comparison with airlines flying across the United States. These carriers can afford to offer bottom of the barrel prices, as they usually make up the bulk of their profits on premium transcon, and international transatlantic and transpacific flights. Nonetheless, Caribbean governments should consider offering discounted rates for Caribbean-born nationals as a way to at least incentivize a bit more travel within the islands.

Rising fuel prices over the past few years has also contributed significantly to the problem, making profitability within the region much more difficult. While some airlines have the privilege of deep pockets to dig into to sustain loss-making routes, others were forced to draw the line and retreat in order to stop excess cash burn. There’s really not much that can be said about this as fuel prices could take years to return to pre-pandemic levels with so much going on across the world.

Then there is the mere fact that there are only that many passengers can you fly from point A to point B. Regardless of how many options you offer, and how cheap ticket prices could be in theory, you cannot look beyond the fact that there will only be X number of passengers to fly per month. Some routes do very well, while other connections are simply not commercially viable and may only exist as an essential service.

With so many fishermen and a limited number of fish to catch, why not focus more on interlining rather than competing? Interlining is an agreement that lets airlines carry passengers, baggage, or cargo across each other’s flights as part of a single connected journey, often on one ticket.

Let’s say I wanted to fly to Anguilla from Trinidad, an interline agreement between Caribbean Airlines and Anguilla Air (for instance) would mean that passengers could book a single ticket, with an aircraft transfer in St. Maarten or Antigua. Things like checked bags would be handled in the background, while re-checking in at the connecting airport would be done away with since you would be flying on a single ticket.

Interlining does have drawbacks, such as compromising on branding, sharing revenues with participating airlines, and dealing with mixed fleeting issues, but given the tricky situation in the region, what else is there to do? Would airlines rather operate flights that that are 3/4 empty in the name of having bragging rights for a route? Or would they be better off intertwining their networks for the greater good? When you only have X number of passengers to serve, compromises have to be made with the hopes of offering better pricing and a generally easier travel experience. There is also the opportunity to link more country pairs that would otherwise be unfeasible if done with a non-stop flight.

From what I understand, some carriers are already working on this, but I think it is something that others should seriously consider for the betterment of the overall network.

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