by “Everyone is complaining, it’s not good. Don’t book Air Vanuatu.” Those were the words of a taxi driver in March as he pulled away from Vanuatu’s Bauerfield international airport and into the heart of Port Vila, the Pacific island nation’s maritime capital.
Two months later and the frequent cancellations and delays that have been synonymous with the national carrier for the past year after giving way, the government announced that Air Vanuatu is in voluntary liquidation. In a country where 48% of gross domestic product is derived from tourism, business owners fear that tourism will dominate the airline’s bottom line.
“The livelihoods of thousands ni-Vanuatu and their dependents employed in Vanuatu hotels and resorts are now at risk,” the Vanuatu Hotels and Resorts Association (VHRA) said in a statement. “Vanuatu’s reputation in overseas tourism markets has been severely damaged. Potential tourists are going elsewhere, and wholesalers are selling to less troubled destinations.”
Related: Flights were canceled and tourists stranded as Air Vanuatu went into voluntary liquidation
Before the pandemic, the country of 83 islands welcomed around 90,000 tourists each year, drawn in by its volcanic landscapes, brochure-worthy beaches and rich marine life. The majority came from Australia and New Zealand, and although Virgin Australia flies to and from the archipelago, Air Vanuatu carried the majority of the country’s air travelers.
Joel Slattery, owner of the Moso hotel, which is located on an island of the same name, said that Vanuatu was in the middle of a post-pandemic tourism boom but the continued disrupted operations of Air Vanuatu meant that people were “crossing it off their list as a destination. “. Speaking from the veranda of the resort’s main house overlooking the ocean, Slattery said that in recent months some guests have been forced to abandon their remote-island experience.
In April 2023 the airline’s only jet, a Boeing 737, was grounded in Brisbane. In September 2023, more than 25 flights were canceled over a weekend due to another “ongoing engineering requirement”; and in January this year it was again forced to stay on the tarmac for scheduled maintenance. The necessary parts have not yet arrived.
Boeing warned last year about supply chain issues with parts, which have been harder to find across the aviation industry since the pandemic and the war in Ukraine.
News of the liquidation has already affected hotel reservations as well as employees, said Stella Nomalo, office manager of Hideaway Island Resort and Marine Sanctuary, located on the island of Efate. “Yes [had] cut back on giving the team a lot of work.” Tourism accounts for 35% of employment in the tropical archipelago.
Other factors, such as the cost of living and low tourist season, could also be at play, said Rob Macalister, president of the Vanuatu Tourism Operators Association and managing director of Vanuatu Ecotours.
Related: The cost of paradise: Pacific islands changing the future of tourism
“Despite pressure on the wider industry”, the appointed liquidators – accountancy firm Ernst & Young Australia – said they believed “the outlook for Air Vanuatu is positive” and said services would resume after after safety and maintenance checks. Meanwhile, a flight has been cancelled, throwing off holiday plans.
“There will be some short-term pain – the industry will have a few quiet weeks,” Macalister said. “But in the long term we are going to achieve a stronger destination because we have to address these issues related to our national airline. This is the beginning of that process.”
If Air Vanuatu were to re-emerge, it would have a “reputation for being unreliable”, Rebecca Allen told Britain’s new woman. In May 2023, five months pregnant with a one-year-old baby in tow, she and her husband, Richard, spent five hours in terminal one airport waiting to return to Sydney for a secondary wedding celebration . Their first wedding took place in the beach backdrop of Vanuatu. The jet would not bring them home that day, or the day after.
They missed the celebration and a year later have not received any compensation for the extra three days – which equates to around A$1,000 – they had to spend in Port Vila.
“[I’m] very upset because I won’t get my money back now,” Allen said, adding that it would be a while before she wanted to visit Vanuatu again. “Hopefully another airline can step in.”
Calling the airline “vital to Vanuatu’s economic well-being”, the VHRA called on the government to urgently address “the immediate crisis and find a lasting solution”.
“They could sell part of the airline … they could merge, they could split the airline,” suggested Macalister. In the meantime, it was important to remember that “Air Vanuatu is in crisis, not the tourism industry”.
