Air Calédonie director asks government for bail out

By Andrew Curran.

Air Calédonie director Daniel Houmbouy has told a government committee that the domestic airline expects to start insolvency proceedings this week.

Houmbouy told a New Caledonia’s legislature (known as the Congress) committee, that the court will decide whether to liquidate Air Calédonie or give it time to submit a restructuring plan.

Air Calédonie went public with plans to file for insolvency in late March after a month-long blockade of four of the five domestic airports that the airline normally flies to.

Ile de Pins Airport blockade ends, but others continue

The blockade of Ile de Pins Airport (ILP) has recently ended, but blockades remain in place at Mare (MEE), Lifou (LIF), and Ouvéa (UVE) Airports.

The blockades have cost Air Calédonie around XPF10 million (USD96,500) per day.

Already, half of the airline’s 220 employees have been placed on involuntary unpaid leave. Of the remainder, Houmbouy said the company currently could not meet April’s payroll obligations.

“Other employees will have to be laid off as well,” he said.

According to the Les Nouvelles Calédoniennes outlet, the Congress is considering a XPF300 million (USD2.9 million) financial contribution, which would about cover the losses caused by the blockades. However, officials have not made a final decison.

“The question is whether the elected officials are willing to do so,” said Houmbouy.

The government has previously planned to tip in subsidies of XPF500 million (USD4.8 million) this financial year. But that was before the blockades crippled the carrier.

New Caledonia Government not budging on Magenta

Protesters are trying to reverse a government decision to switch Air Calédonie’s Nouméa operations from Magenta Airport (GEA) to La Tontouta Airport (NOU).

But last week, New Caledonia’s president, Alcide Ponga, said those plans hadn’t changed.

However, Houmbouy is counting the government figuring that bailing out Air Calédonie is a more politically palatable option than allowing the airline to fold.

Air Calédonie plays an important public service role linking New Caledonia’s outer islands to the mainland, where Nouméa is located.

Air Calédonie’s shareholders include the New Caledonia Government (52.45%), the Loyalty Islands Provincial Government (26.21%), the North Provincial Government (14.55%), and the South Provincial Government (5.16%).

Having government support and financial assistance locked in will make it easier to convince the court to allow the airline to formulate a restructuring plan.

If the court agrees, it will be the second time in less than three years that Air Calédonie has been restructured.

Photo: AI-Generated.

Contact the writer: andrew@aerosouthpacific.com