Aviation: Cabo Verde Airlines Announce Indefinite Suspension of Salvador Route

cabo cape Salvador pandemic

The national carrier of West African island nation, Cabo Verde Airlines (CVA) has announced that from March 1, 2020, the route between its island of Sal and Brazil’s Salvador da Bahia will be suspended indefinitely.

The announcement which was issued in a press release on Friday 14, 2020 cited “a wider restructuring and the addition of new destinations.”

According to the statement the national airline, “due to the expansion and launch of new destinations in 2020 to Europe and Africa,” the airline had decided to “restructure its air routes, suspending indefinitely the Salvador da Bahia – Sal – Salvador da Bahia route” from the beginning of next month.

Cabo Verde Airlines is now controlled by Icelandic investors led by Icelandair, and currently serves several destinations in Brazil, including Recife, Fortaleza and Porto Alegre, all of whose services “will continue to operate normally,” the statement reads.

The statement also noted that “All passengers affected by cancellations will be accommodated on flights from Recife or Fortaleza,” and added that “Passengers who do not accept [these] options will be entitled to full reimbursement of their tickets, in accordance with the company’s passenger protection plan.”

Media reports in Bahia had in recent hours reported the possibility of Salvador losing its CVA connection, saying that state government officials were trying to negotiate with the company to persuade it to reverse the decision.

In March 2019, the Cabo Verde state sold 51% of the then public company TACV for €1.3 million to Lofleidir Cabo Verde, a company owned 70% by Loftleidir Icelandic EHF and 30% by Icelandic entrepreneurs with experience in the aviation sector.

Loftleidir ended up with 36% of the new CVA and its partners 15%, with the Cabo Verde state retaining 49%.

The company links the archipelago of Cabo Verde, from its hub on the island of Sal, with Dakar, Lisbon, Paris, Milan, Rome, Boston, Washington and Lagos, in addition to the four current destinations in Brazil, while new routes to Toronto (Canada) and Porto (Portugal) are under consideration.

Earlier in the week, Lusa reported that the Icelandair group expects the Cabo Verde airline to report a profit in 2021, but that it needs to secure long-term financing – information contained in the Icelandic air group’s 2019 report and accounts, released on 7 February.

Icelandair notes that according to the CVA business plan, losses “are expected” in the first two years after the acquisition and profits only in 2021. The document also states that CVA’s operating results in the last quarter of 2019 “were below expectations”, without giving any figures.

“The CVA is looking for long-term funding,” it states. “If long-term funding is not guaranteed, this could negatively affect the operation.”
Icelandair group report insists that the company sees its investment in CVA as “a long-term development project” and that “there are opportunities” to transform the country into a hub between the African, American and European continents “and at the same time develop Cape Verde as a tourist destination.”

Cabo Verde’s government is still undertaking the process of selling 10% of CVA shares to workers and emigrants and the remaining 39% to other investors, on the stock market.

In the first eight months after privatisation, CVA carried almost 200,000 passengers, up 85.4% from the same period of 2018, according to company officials.

Source: Macau Business News

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