Mandarin Air suspends Saipan flights • Carrier cites FAA regulation, low market demand as reasons

Mandarin Airlines will cancel its flights to the Northern Marianas due to revenue losses incurred since November 2000 after the termination of charter agreement with Tinian Dynasty Hotel & Casino.

Mandarin Air Saipan Station Manager Charlie Ling said Saipan-Taipei flights will be suspended beginning March 24 until June this year to prevent more losses, projected to reach $20,000 per roundtrip.

Mandarin Air decided to suspend operations between Saipan and Taipei despite the recent signing of an agreement with Mobil Oil Marianas, granting a 10-cent reduction on aviation fuel for the carrier beginning May.

The suspension also came amid pledges made by the CNMI government in terms of releasing about $100,000 in additional funds to finance tourism promotion in Taiwan.

The Air Service Committee of the Strategic Economic Development Council believed increased promotional activities in Taiwan will help Mandarin Air lure more Saipan-bound passengers from that country.

The additional funds for promotions and Mobil Oil’s decision to cut aviation fuel rate for Mandarin Air apparently failed to convince the carrier to sustain its Saipan services, mainly because of the $12,000 losses incurred each flight since November last year.

The scheduled suspension of flights will also enable Mandarin Air to improve its Federal Aviation Administration compliance with ETOPS.

FAA regulations require air carriers to be on top of its maintenance operations and ETOPS upgrading will commence this month through May, Mr. Ling explained.

Once the upgrading is complete, Mandarin Air will be able to service Saipan-Taipei route again, using its own aircraft this time. Present flights are being serviced by its parent company, China Air.

Mandarin Air has a fleet of five Boeing 737-800 aircraft. It services the Taipei-Saipan route with about nine flights per month.

With Mandarin Air’s decision to temporarily suspend its Saipan services, the Northern Marianas will lose about 30 flights and more than 4,300 tourists.

In January, Mandarin Air enplaned 822 passengers and deplaned 708 while February enplanement reached 886 and deplanement, 872. Mandarin Air records disclosed an estimated 62 percent and 65 percent passenger load for the last two months.

Mr. Ling pointed out that the continued economic recession and rising unemployment in Taiwan have aggravated the declining tourism market.

Mandarin Air officials decided to suspend operations from March to June because these months are believed to be the leanest and slowest season for tourism.

Mr. Ling said the 10-cent aviation fuel price rollback granted by Mobil to the carrier is a welcome development, but added that the suspension was inevitable.

He also assured that the flight suspension is only temporary to prevent aggravated revenue losses and that flights will resume after maintenance operations during the summer season.

At present, Mr. Ling said aviation fuel prices are pegged at $1.35 per gallon and Mandarin Air refueling quantity per round trip flight is 4,000 gallons.

Once the agreement with Mobil takes effect, Mandarin Air will save $400 per round trip flight and $3,600 aviation fuel savings per month.

“It’s not that big but definitely it is an achievement and it will help Mandarin Air,” he told reporters in an interview.

The rollback was one of the three major points raised by Mandarin Air to sustain the Taipei-Saipan route which was adversely affected by Tinian Dynasty’s decision to terminate its charter agreement with the carrier.

Tinian Dynasty stopped chartering 138 seats per week which covered an estimated 44 percent of the total salable seats. Apart from Tinian Dynasty, another major seat buyer stopped chartering 100 seats per flight last month. (EGA)