SPIRITS HIGH WITH ARRIVAL OF LOW COST CARRIER

UNCLAS KINGSTON 001318

SIPDIS

STATE FOR WHA/CAR/ (WBENT),WHA/ETRD (MATTINGLEY)

SANTO DOMINGO FOR FCS AND FAS

TREASURY FOR L LAMONICA

E.O. 12958: NA
TAGS: EAIR JM
SUBJECT: SPIRITS HIGH WITH ARRIVAL OF LOW COST CARRIER

REF: A) STATE 83667, B) 04 KINGSTON 3385


1. On May 19, Emboffs attended an Airports Authority of
Jamaica press conference announcing the planned launch of
scheduled flights between the United States and Jamaica by
Spirit Airlines, Inc. (ref A) Prior to the official start of
the conference, Emboffs spoke with Guillermo "Bill" de la
Torre Bueno, Director of Sales Programs and International
Sales, and Marc Cavaliere, Vice President for Sales and
Distribution.


2. Bueno said that the prospects for Spirit looked very good
in Jamaica, especially as they are the first low-cost
carrier to enter the market. His announcement of a USD 99
fare from Fort Lauderdale to Jamaica (with flights to both
Montego Bay and Kingston) elicited expressions of surprise
and delight from the audience, since it is considerably less
than the fares charged by Air Jamaica, American Airlines and
other carriers currently serving the island. Spirit
Airlines will be making two flights daily to Sangster
International Airport in Montego Bay and another two to
Norman Manley in Kingston starting in November.



3. When asked if they planned to extend their low-fare
service to the Eastern Caribbean, where Air Jamaica has
recently announced the cancellation of its routes, Bueno
replied that such matters were confidential. During his
presentation, Cavaliere stressed the idea that Spirit
planned to bring in both business and leisure travelers, and
that they expected to bring in a new demographic of
visitors, rather than cannibalizing existing air travel
customers from other airlines.


4. Comment: Though the USD 99 fare was later qualified as
being an "introductory, off-season" price and does not
include airport taxes and other fees, it will likely remain
significantly less expensive than the fares offered by
Spirit's competitors. Cavaliere appeared to understand the
hurt pride tied up with Air Jamaica's financial woes (ref
B),and his comments seemed designed to make it appear that
Spirit would not be competing directly with Air Jamaica for
customers. The availability of significantly reduced fares
on regularly scheduled Spirit flights may be yet another
nail in struggling Air Jamaica's coffin, and Cavaliere was
attempting to avoid giving the appearance of dancing on the
national airline's grave. End Comment.

TIGHE