New pan-Micronesian airline proposed for Pacific Islands

By Andrew Curran.

A Guam-based consulting firm with a defunct website has released a discussion paper proposing a jointly owned pan-Micronesian airline. The release coincides with the Pacific Islands Forum leaders' meeting underway this week in Palau.

Tewid Meresbang, CEO and co-founder of Pacificnesian Equities, told Micronesia’s The Kaselehlie Press that he had sent the unsolicited preliminary proposal to government ministers from small island nations across Micronesia attending this week’s meeting.

The proposal suggests that Palau, the Marshall Islands, Kiribati and the Federated States of Micronesia consider jointly establishing a regional airline that would fly an east–west corridor from Koror (ROR) in Palau through Yap (YAP), Chuuk (TKK), Pohnpei (PNI) and Kosrae (KSA) to Majuro (MAJ) and Tarawa (TRW).

Additional routes would branch off, linking Koror with Guam (GUM) and Majuro with Honolulu (HNL).

The Pacificnesian Equities plan proposes one leased regional jet, nominating the A220-100 or B737-7 as suitable aircraft, and two turboprops, such as ATR42-600s. The plan suggests it would cost between USD15 – 35 million to establish the airline and another USD20 – 45 million annually to keep operating.

A plan to take on United’s Island Hopper flights

Acknowledging that the proposal is an AI-assisted preliminary concept without the regulatory, engineering or financial analysis that would form part of a formal feasibility study, the mooted airline would take on United Airlines’ longstanding Island Hopper flights, which have drawn ongoing criticism for their high fares and sole-operator “take it or leave it” operating model.

In contrast, the Pacificnesian Equities plan proposes capping round-trip fares for Micronesian residents at USD400, with foreigners paying more, and using the higher fares charged to foreign travellers, cargo revenue and government subsidies to cover the remaining operating costs.

The proposal calls this strategy “a combination of aggressive cross-subsidisation via premium cargo, a two-tier pricing model and structured intergovernmental underwriting.”

It also flags Compact of Free Association funding, international development assistance and tourism levies as potential sources of revenue.

Pacificnesian Equities describes itself as a Guam-based consulting firm working on equitable and sustainable development projects in Guam. Its website is inoperative, but it does have an active Instagram account. According to his LinkedIn profile, Tewid Meresbang, who founded the consulting company in 2022, formerly worked for the US Coast Guard, most recently as Head of Department, Procurement and Contracting.

Reports release coincides with Pacific Islands leaders' meeting

The Smaller Island States Leaders meeting in Palau over the weekend, ahead of the larger Pacific Islands Forum leaders' meeting, nominated reliable and affordable air and sea transport as one of its key priority areas.

The Smaller Island States member nations include the Cook Islands, Federated States of Micronesia, Kiribati, Nauru, Niue, Palau, the Marshall Islands and Tuvalu.

Surangel Whipps Jr., President of Palau, assumed the Chair's role over the weekend, taking over from Taneti Maamau, President of Kiribati.

Whipps supports of the idea of more competition and reduced travel costs in the region.

“The high cost of flights, you need competition,” he told local outlets attending the event.

However, Whipps suggested an alliance of existing airlines in the region could be a better option than starting a new carrier from scratch.

“One of the things that we’ve noticed is that as the world, the big airlines have created all these alliances, Pacific carriers are not part of any of these alliances,” he said. “Maybe we need to build our own alliance and be able to work together to leverage that capability.”

“We have Air Niugini, Solomon Airlines, Fiji Airways, Nauru Airlines. Why don’t we have one Pacific alliance? These are things that we have to work on together.”

The Pacificnesian Equities operating model similar to One Pacific Airways’ model

The Pacificnesian Equities plan is not dissimilar to the operating model of another would-be Micronesia-based start-up, One Pacific Airways, which is eyeing a similar route network using a small fleet of E145s.

That carrier, still without regulatory approval or aircraft, harbours ambitions to be in the air by the end of 2026.

The Pacificnesian Equities proposal also has a less costly Plan B strategy, which would involve the various Micronesian governments establishing a virtual airline brand and wet-leasing aircraft from an existing operator to operate the flights.

Aside from United’s Island Hopper service, Koror in Palau is connected to North Asia and Australia by a handful of carriers. But the remainder of the Micronesia region is home to some of the world’s most poorly connected capital cities. 

As Aero South Pacific’s Country Briefs reveal, the four airports in the Federated States of Micronesia are wholly reliant on the Island Hopper flights, while Majuro in the Marshall Islands is also linked to the equally isolated Tarawa in Kiribati and Yaren (INU) on Nauru via Nauru Airlines services, and Fiji Airways flights also link Tarawa to Nadi (NAN).

In addition to a lack of choice and frequencies, current airfares within Micronesia are among the highest in the world when measured on a per-kilometre basis.

Photo: AI-Generated.
Contact the writer: andrew@aerosouthpacific.com