A sad return to monopoly

Whatever the loyalties Caribbean people may have for Caribbean Airlines, the news of Redjet's withdrawal must be a source of great disappointment. In its brief life, the upstart airline succeeded in rattling CAL enough to stir it out of the complacency that comes from living on monopoly power within any market. 

For too long, the travelling public of the Caribbean has had to pay the price of an airline that enjoys the luxury of infinite support by the taxpayers of Trinidad and Tobago. Left to fend for itself, CAL would long ago have paid the ultimate price for the multiplicity of management mistakes that have kept it a burden on taxpayers, notwithstanding the current management's declaration of some rather bemusing profits.

In a free enterprise environment like the English-speaking Caribbean, it is particularly galling to see an entrepreneurial initiative like Redjet fall prey to a monopoly that has succeeded in muscling it to the point of extinction, not because of superior service at a superior price, but because of its easy access to the Treasury.

The great fear of the regional travelling public now must be that with Redjet out of the picture, CAL will return to its old ways, holding the public to ransom in the way that monopolies, especially state monopolies, are wont to do.

Like so many of our State enterprises, CAL is not subject to the kind of regulation and supervision that is required for accountability and consumer protection, especially when the enterprise involved is a monopoly. In this regard, a vigilant public and consumer power may be the most effective strategies in keeping CAL accountable and on its toes.

As for Redjet, it is not the first airline to fall victim to the high financial demands of the inter-regional airline market. Several have passed this way before, all of them enticed by the possibilities of serving this archipelago of islands where inter-island communication is a challenging fact of life. But as this neophyte competitor has discovered, there is a yawning gap between paper economics and actual economics when it comes to the Caribbean.

It must have seemed like a fairly straightforward proposition to Redjet to enter the region with a cut-price strategy and take CAL to the cleaners. But it clearly did not bargain for the cultural complexity of Caribbean markets that can be price resistant, even defiant.

Whatever its warts, CAL is the inheritor of a proud BWEE tradition. Its safety record and reputation for Caribbean warmth have earned it a place in the hearts of all Caribbean people, even when they are minded to unleash their anger and acerbic wit on it. In evaluating the impact of the withdrawal of Redjet, we hope CAL will resist the temptation to crow and focus, instead, on learning the lessons taught by the enterprising team of youthful entrepreneurs who, for the short time they were here, managed to sizzle the market.

Source:  http://www.trinidadexpress.com