Royal Tongan Suspends Bookings

[Convict]

Heard on the TV One News tonight.
Royal Tongan Airlines has suspended bookings for all its flights. Has the Sultan run out of patience?

[Wirraway]

Sat "The Age"

Royal Tongan Airlines' aircraft grounded
April 24, 2004 - 8:30AM

Royal Tongan Airlines was grounded on Friday after Royal Brunei Airlines seized its only operating aircraft, a Boeing 757, aviation industry sources said.

The government-backed airline operated the aircraft daily between New Zealand, Australia and Tonga, and also ran services to the Cook Islands and Hawaii.

The source said the airline, which flew its last service Thursday, owed "a lot of money and had numerous creditors".

The aircraft, which flew in Royal Tongan colours but was owned by Brunei, was now being stored in the Air New Zealand hanger at Auckland International airport.

The improvised Tongan kingdom chartered the aircraft in November 2002 in what was initially a deal between King Taufa'ahau Tupou IV and the Sultan of Brunei, but it caused a severe drain on government finances.

The government did not revealed how it was being funded but the main source of money was from the governments Tonga Telecommunications Commission.

Last year commoner politicians in Tonga leaked a report for the Tongan government by the accountancy firm KPMG Financial Advisory Services, which said the airline had forecast a 65 per cent load factor but was running at only 34 per cent.

KPMG said the airline would have to put 10 million US dollars - or 13 per cent of the government's budget - immediately into the airline to keep it flying.

Neither the Tongan government nor the airline were commenting Friday.

Tonga is a Polynesian archipelago about 1,770 kilometres (1100 miles) northeast of New Zealand with a population of about 110,000.

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[Blown Seal]

The move to get the 757 in the first place is not something you would be teaching management students. The old cliche "you've gotta crawl before you can walk" rings oh so true in this case. Hopefully for the airline and the country the CEO is removed as well. The financial drain and strain he has placed upon this already very poor country is bordering on criminal financial mismanagement.

[Plas Teek]

criminal financial mismanagement

Just like the rest of their Govt.

[lame]

Air NZ looking to help stranded passengers

SATURDAY , 24 APRIL 2004


Air New Zealand today said it was looking at ways to help travellers stranded over the grounding of the plane used for Royal Tongan Airlines' international routes.

The Boeing 757, leased from Royal Brunei Airlines, was understood to have been prevented on Thursday from operating yesterday's service from Auckland to Tonga.

Air NZ said it working with Tongan authorities to help stranded passengers, but details had yet to been confirmed.

Meanwhile, a spokeswoman for the financially-troubled Royal Tongan Airlines said the reason the plane did not take off was because of a mechanical problem.

She did not know what the problem was, but the airline was hopeful of taking some passengers back to Tonga this weekend if the necessary parts arrived.

However, she admitted that the prospect of further flights "does not look good".

"We can only wait and see. We're hanging in there."

Kalafi Moala, the editor of Auckland-based newspaper Times of Tonga, estimated that about 200 passengers had been waiting to fly out of Auckland airport.

He expected a similar number would have been stranded in Tonga.

He said a permanent grounding of the Boeing 757 would cause significant disruption as May to July was the busiest period for travel to Tonga.

There were festivals marking the birthdays of the King and the Crown Prince, while June was the month of church conferences.

"People will have booked all the way through to July," he said.

"Another airline will have to step in. Air NZ flies there anyway, but will probably have to put on extra flights."

Royal Tongan Airways flew four times a week between Auckland and Tonga.

The airline's troubles were revealed in an investigative report by accountants KPMG in June last year.

Its budgeted loss for the year ending June 2004 was $NZ13.2 million, according to the report, but industry sources believed it was far higher, up to $47.5 million.

Mr Moala said the airline's problems spelt economic disaster for Tonga, because the airline had borrowed from both Tonga Telecommunications and the Government.

[welcome_stranger]

It looks like the ADF charter on the 18th and 19th, going Auckland to Dili and then return via Brisbane, happened just in time.

Wonder who the DoD is going to sent the cheque to?:O

[belowMDA]

Hopefully this situation may provide the tongan people with some more motivation (if any is needed) to seriously question the monarchy in their country. The whole system of government there seems to be corrupt in some form. I believe that the CEO of RTA is the King's son who just so happened to go to school with the Sultan of Brunei or his son. So being "mates" one offers the other a 757 to lease (no doubt one that they couldn't find any work for) and no doubt says all those other nations around you will be envious ie Cook's and Samoa. But hold on they couldn't make a 732 work for them so how can they find work for a 757 and sucessfully compete against an airline like Air NZ. But to admit that you made a mistake or were corrupt in your dealings would be to lose face so they plod on and get emergency loans to keep paying the Sultan (who I reckon probably isn't too hard up for cash) for his 757. Another example of the madness going on is the decision to sell the Islander that serviced Eua. At 13 NM away a far better suited aircraft to the route than a Twin Otter but "we must save face we must fly only turbine aircraft". So any way, the whole country ends up going broke just because corrupt royals cannot admit they were not so smart in making some decisions. If they were a little smarter then they might try and get all the nations around them: Fiji Samoa and Cook Is and get some commonality in their fleets and have a parts and engineering pool amongst themselves. 737NG S340s and Otters and Islanders. might make life a little easier on themselves. But then pigs might fly!!!!!

[Animalclub]

belowMDA
They tried that with the airline that became Air Pacific... and it didn't work. Some countries were crying out for such as daily services when there was work for just a weekly service... and so on.
How many times have I heard a Head of Government of a South Pacific nation say that his ambition is to get a national airline. How many work without "loans" (read gifts) from other nations? How many have ceased to exist when key positions are localised? But they are beautiful countries.
I could go on.

[Blown Seal]

Below MDA,

The king's son is actually the Chairman of the Board, not ceo, who is an ex NZ CAA inspector/ Air NZ QA manager. However you are correct, corruption is rife throughout the kingdom. Having spent a little time in PNG there are some unfortunate parallels between the two countires. And the situation here is only getting worse.

Mid last year when discussing foreign aid for South Pacific nations the Australian Gov't strongly suggested the formation of a "Regional" Airline for the countries that cannot (obviously see RTA) afford to run their own international operations. The benefits of getting some profit by sharing a company compared to massive losses going it alone is just common sense. Unfortunately common sense isn't that common. Especially in the South Pacific where it seems more important to play "who has the biggest..." between nations, a throwback to tribal rivalry.

Back to RTA for a moment, unless the government give a fairly large, immediate cash injection the whole airline will cease operations by the end of May, just before the Church conference, the busiest time of the year. Hopefully there is some money left in the piggy bank for the govt to hand out.:{