Sea Passion Group, the firm that operates Palau Pacific Airways (ED, Koror) and Sea Passion Hotel in Palau, has confirmed the carrier will cease all operations next month in light of intense competition as well as China's decision to shun the Pacific island state diplomatically.
Founded in 2014, Palau Pacific Airways operates a single B737-800, chartered from Slovakia's Air Explore (ED, Bratislava), to run regular passenger flights between Palau and Hong Kong Int'l.
However, according to the Island Times, the group said in a letter to the Palauan Congress that some competitors, who only operate during peak seasons, have reduced their prices to “unmaintainable levels simply to gain short-term market share.”
It said that when PPA first started flights four years ago, the average market price per round-trip ticket was around USD800 with annual loads of approximately 30,000. However, as of this year, fares have plummeted to USD300 while loads for the first six months of the year have dropped to 14,000.
The latter it attributed to China's decision to...
