Solomon Airlines CEO accepts PM’s reform challenge
By Andrew Curran.
The CEO of Solomon Airlines has welcomed calls by the country’s newly installed prime minister to “think big” and fast-track a strategic roadmap for the state-owned carrier’s future.
Late last week, Prime Minister Matthew Wale and Finance Minister Gordon Darcy Lilo met with the airline’s board and management. According to the prime minister’s office, the pair said urgent reforms were needed at the airline.
“We want Solomon Airlines to succeed, but we must act decisively,” Wale said. “You need to think big and stop undermining the industry.”
“Domestic airfares are too high, freight costs are excessive and flight schedules are inconsistent. These are issues that must be addressed.”
Directness is welcome, says Solomon Airlines CEO
Wale was only elected prime minister in early May. He shares his recent appointment with Solomon Airlines CEO Matthew Findlay, who only started in the role in March.
“I welcome the Prime Minister's and Finance Minister's directness,” Findlay told Aero South Pacific. “They are right to have the highest expectations of Solomon Airlines, and right to ask us to think bigger, move faster, and bring forward a clearer strategic roadmap.”
Earlier this year, Findlay’s predecessor, acting CEO Paul Abbot, said Solomon Airlines was in trouble, with 90% of routes failing to come close to covering even their direct operating costs and passenger traffic in long-term decline.
“At Solomon Airlines we are at a crossroads, potentially at the final decision point concerning the future of the airline,” Abbot said.
But the airline takes its role connecting Solomon Islanders to each other and to the world very seriously. Abbot said the swathe of unprofitable routes were “a vital connection for the people of the Solomon Islands”.
At the time, Abbot was campaigning, unsuccessfully as it turned out, against an application by Qantas for greater capacity on the Honiara (HIR)–Brisbane (BNE) route.
Findlay says the airline continues to face domestic losses, international pressure, high fares, reliability issues and high freight costs. Nonetheless, he agrees with the prime minister that the Solomon Islands deserves a high-standard national carrier.
“We do not shy away from the realities raised,” Findlay said. “They are all live challenges, and they sit squarely on our desk to fix.”
“Solomon Airlines exists to serve the nation and reform of a national carrier is never simple, particularly across a 1,000-island archipelago, but it is necessary, and it is overdue.”
Small carrier with a propensity to take a chance
Solomon Airlines flies to 22 airports across the Solomon Islands and seven international airports. It operates a fleet of five aircraft, comprising two A320-200s, two DHC-6-300 Twin Otters and one DHC-8-100.
Despite Wale’s comments, Solomon Airlines has not stood still in recent years, especially considering it is a small operator. Before Abbot and Findlay held the top job, the airline stepped into the vacuum created by the liquidation of Air Vanuatu and launched international flights from Port Vila (VLI) and Espiritu Santo/Luganville (SON), services that continue today.
Under Abbot’s watch, the airline announced plans to scale up its international flying. At the end of this month, Solomon Airlines will also begin services between Honiara (HIR) and Port Moresby (POM). In July, the airline will launch twice-weekly return flights between Port Vila and Christchurch (CHC).
In January, Abbot said the international expansion was a case of “adjusting operations to meet opportunities for new business whilst serving our national interests”.
In April, with the airline’s fuel costs up 70%, one of Findlay’s first tasks was to trim domestic and international flight schedules.
However, a robust and profitable international network is critical to Solomon Airlines because the revenue cross-subsidises its largely unprofitable domestic services. That is why Abbot pushed back so strongly against the Qantas application and why the new international routes were quarantined from the April cuts.
Findlay says the threatened supply of aviation fuel became a major focus for the airline, but that issue is now slowly easing.
“We are intently focused on creating a clear strategic roadmap for the airline's future,” the CEO said. “We discussed at length with the prime minister and finance minister the need for strong partnerships with the financial and operational depth we require as part of our path to sustainable, lower-cost domestic and international operations, while keeping prices as low as possible.”
Lilo told the airline’s board and management that one possible solution was the development of “strong, strategic partnerships”.
“We need partners with deep financial capacity,” the minister said.
“This is work our board and management will accelerate to bring forward the comprehensive plan the Prime Minister has asked for,” continued Findlay. “We accept the challenge, and we intend to meet it.”
Acting Solomon Airlines Board Chairman Baoro Laxton Koraua also acknowledged the concerns raised by the prime minister and finance minister, saying restructuring the airline was necessary.
Photo: Solomon Airlines, Solomon Islands Prime Minister's Office.
Contact the writer: andrew@aerosouthpacific.com