Posted on

Cost of the LIAT charter from Jamaica should not be more than US$25,000

Cost of the LIAT charter from Jamaica should not be more than US$25,000

Share

Editor: I read with interest the article on repatriation of students from Jamaica. I do not want to dwell on the “politics” of who should be responsible for their return cost. I do however question the amount quoted by LIAT for the flight. Here some numbers that are easily checked on the Internet

When determining the operating cost of an aircraft it is divided into two parts:

1. Direct operating cost – is normally determined as a $ cost/hour. The major elements are : Fuel, Engine reserves, Routine and recurring maintenance, Crew, Navigation charges, Landing and Handling charges.

2. Indirect operating costs – is normally calculated on an annual basis. The total cost is then divided by the number of hours flown/year to find the hourly cost. The major elements are:- Aircraft lease/loan costs (payments), Insurance, Ground operations and staff, buildings. There are many other elements that are included in this area.

Due to the situation, LIAT is to all intents and purposes grounded. They still operating the occasional flight, but the CEO in her letter has stated these are freight or humanitarian in nature. This basically means that LIAT is still paying all the “Indirect Operating Costs” of the airline. So, for the purposes of calculating the cost of sending an aircraft to collect Vincentians only the “Direct Operating Costs” should be used. Maybe the students could be asked to contribute.

Here is the information that I believe should be used to calculate the cost of assisting the students

Distance SVD to Kingston 950NM (direct) call it 1000NM to allow for indirect routing

Cruise speed 260 knots
Flight time 3.8 hours call it 4.00 hours each way i.e. 8.00hrs
Fuel burn (cruise) 250 gals/hr (1,680lb/hr)
Fuel cost US$5.50/gal (approximate check with Rubis),
Fuel cost/hr $1,375/hr
Total fuel cost $11,000

Since the repatriation of the students is “mission of mercy”, so to speak, and LIAT is owned by Governments, only Direct Operating Costs should be used plus:

Landing fees in Jamaica. (Should be waived at Argyle as it is SVG government)
Handling Fees

Crew costs – this may be a consideration as methods of paying salaries varies
Positioning sector SVD to ANU – approx. 1 hour + $1500

Add on 20% for other expenses.

The total should not exceed $18,000. So, round it up to $25,000.

If the students are now asked to pay $450 each (the normal single fare) everyone should be happy. Government win some popularity points and LIAT is not out of pocket.

WIN, WIN

LAST NEWS