Air Pacific

Air Pacific charts its future course as a rebranded Fiji Airways when MD Dave Pflieger departs

Air Pacific takes delivery of its first of three new A330-200 aircraft on 19-Mar-2013, heralding the start of a new era as  a rebranded Fiji Airways. But the carrier will chart its new course without inspirational MD Dave Pflieger who is returning to the United States when his three year contract ends in May-2013.

Mr Pflieger will be a tough act to follow, having delivered a quite remarkable turnaround of Air Pacific’s fortunes during his tenure. Mr Pflieger led a 360 degree review and restructure of an ailing Air Pacific, financially putting the carrier back on its feet by reversing record losses, re-equipping its wide-body fleet and culminating in the airline rebranding to its 1960s name, Fiji Airways, in Jun-2013.

Mr Pflieger will take up a new position as president and CEO of United States regional carrier Silver Airways based in Florida. His departure is a potential risk to Air Pacific’s expansion plans, particularly in the valuable United States market where Mr Pflieger’s American airline background meant he was well placed both to understand and implement connections and leverage the codeshare agreement with American Airlines which was signed in Dec-2011.

Fiji's Air Pacific, revived and rebranded, is ready to embark on a new future

Air Pacific believes it is almost ready to take the fight back to its Australian and New Zealand rivals with a revitalised staff, an overhauled in-flight product, new identity and distinctive traditional livery on a new fleet of A330-200s in 2013.

Financially Fiji’s national carrier, which will revert to its original name of Fiji Airways, is back on its feet, recovering from a record loss to return to profit this year, and with arch rival Virgin Australia focused on a bigger battle for the Australian domestic market, Air Pacific/Fiji Airways could look to recoup some of the more than 50% market share it has lost in recent years.

But Managing Director Dave Pflieger, a former senior executive at Virgin America, warns that the 46% Qantas-owned airline still has a long way to go as it works its way through the final phase of its three-stage transformation programme. Key risks remain, including an uncertain global economy, volatile fuel costs and the threat of renewed competition. And somewhere along the line, the commercial/political/legal squabble with Qantas needs to be resolved.

Qantas-Air Pacific used as proxy fight between Australia and Fiji

Qantas and Air Pacific have been caught in a proxy fight between their home countries as Australia condemns the ongoing lack of democracy in Fiji since military leader Frank Bainimarama took control of the island nation last decade. Bainimarama in turn has had the civil aviation ministry pass a decree requiring, amongst other statutes, Fijian airlines to have local citizens comprise two-thirds of the board. Fiji has a 51% stake in Air Pacific while Qantas holds a 46% stake and accounts for four of the nine board seats.

While it is apparent Qantas will have to relinquish a board seat to comply with the new regulations, the carrier for some years has been seeking to sell its stake – and would surrender all board seats – but Fiji is unwilling to spend the AUD15 million that Qantas' stake is valued at. Fiji is also irritated that Qantas' LCC Jetstar serves Fiji, to Air Pacific's detriment, although Virgin Australia has significantly more capacity.

Air Pacific ‘will not fail’ as restructuring continues; ownership questions remain

Air Pacific, Fiji’s national carrier, stated that despite recent challenges and a number of restructuring changes, it aims to return to profitability and maintain operations. High fuel prices and increasing competition from LCCs, including Virgin Australia and Jetstar, has hurt Air Pacific, with the airline reporting its largest full-year loss last year at FJD90 million (USD51 million).

LCCs ready for take-off; carriers prepare for Boeing B787 deliveries

LCC start-ups dominated airline news this week. Air Canada revealed it is drawing up a business plan to launch an LCC in response to its fast-growing low-cost rivals such as WestJet, Porter Airlines, Air Transat and Sunwing in the Canadian market, according to reports.