AIR Jamaica recorded a 40 per cent drop in revenues to US$154 million ($13.2 billion) in 2010 whilst operating with less passenger seats filled than the year before, just released data indicates.

Its the third consecutive year of revenue declines for the airline which reduced its plane count in preparation for divestment last year, according to preliminary data released by the Planning Institute of Jamaica (PIOJ) obtained by the Business Observer. The profit or loss of the airline was not disclosed.

However, it stated that the airline’s occupied seats or passenger load factor, a key measure of efficiency dipped to 67 per cent in 2010 from 74 per cent in 2009. It meant conversely that roughly one-third of available seats were unfilled in 2010, an increase from one-quarter unfilled in 2009. All other basic operational statistics showed declines year on year but the PIOJ, the government’s planning arm, contextualised the airline’s declining performance.

“The operations of the airline must be viewed against the background of the preparation for and the eventual transfer as well as the continuing impact of the global recession on travel. As a consequence, the airline continued the shedding of routes which started in 2009,” stated the PIOJ in its annual Economic and Social Survey (ESSJ) 2010, which annually compiles sectoral data for analysis.

It added that the airline started 2010 with 11 routes but terminated six during the year. Those terminated included Orlando, Baltimore, Havana, Curacao, Chicago, and Grenada while operations continued on New York, Philadelphia, Fort Lauderdale, Nassau, and Toronto routes. “Three fewer aircraft provided service compared with nine in 2009… All indicators of the airlines basic operating data recorded declines.”

In May 2010, after protracted negotiations, Air Jamaica and Caribbean Airlines (CAL) began operating as one Caribbean airline.

Under the agreement, the Jamaica government owns 16 per cent as part of the conditions for the airline taking over the lucrative routes of the cash-strapped Air Jamaica. The acquisition is to have grown Caribbean Airlines assets by 2010 to US$500 million. Shortly after the acquisition, Air Jamaica switched its fleet from seven Airbus A-320s, one A-321 and one A-319 to a full line of Boeing 737-800s. The switch harmonised both airline fleets.

Earlier this year, CAL told the Business Observer that it expected to cut Air Jamaica’s maintenance costs by half due to switching from Airbus to Boeing planes. Most recent data indicates that maintenance costs at Air Jamaica is the fourth-highest expense behind employee costs, aircraft lease and aircraft fuel and oil based on financials. Specifically maintenance of the airline stood at US$54.56 million in 2006, US$63.7 million in 2005 and US$58.8 million in 2004 according to the Jamaica Public Bodies published by the Ministry of Finance.