CDB – Air Transport the Matic Study May 2015
MAKING AIR TRANSPORT WORK BETTER FOR THE CARIBBEAN © Caribbean Development Bank ISBN: 978-976-95695-6-0 978-976-95695-5-3 May 2015 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electric or mechanical, including photocopying, recording or otherwise without the permission of the publisher. Published by: Caribbean Development Bank Printed by: Caribbean Development Bank The views expressed in this book, as well as any errors of commission, or omission, are the sole responsibility of the authors, and do not necessarily reflect the opinion of the Caribbean Development Bank. FOREWORD iven the geographical spread of the Caribbean, air transport is vital in linking families and communities, as well as supporting economic activity. Most airlines based in the GCaribbean have regularly made operating losses, although this is not a phenomenon unique to the Region. Across the globe, competition in the industry has intensified over the years. Deregulation has generally benefitted passengers at the expense of legacy airlines, with low cost carriers exploiting opportunities for growth. Passengers’ expectations of low fares have increased, while many of the costs of providing air transport, particularly fuel, have gone up. The worsening economics are exacerbated in the Caribbean, where economies of scale seem elusive at best. Globally, airlines have had to adapt. They have done so in a number of ways, for example, through closer cooperation to reduce costs and/or increase passenger numbers and revenues. Three major world alliances, Star Alliance, One World and Sky Team, have emerged.
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