"FATHER" OF ISLANDS AIRLINES, DENNIS BUCHANAN, READY TO RETIRE

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By Robert Keith-Reid

PORT VILA, Vanuatu (August 10, 2000 - Islands Business Magazine/PINA Nius Online)---He's small, energetic, sun-wrinkled, Australian blunt and in times of irritation apt to punctuate his remarks with heavy use of that f-word.

He'd be bound to be high on a list of nominations as the, or at least a, "Father of Pacific Islands Aviation." In a lot of places in Melanesia it's sufficient just to drop the name Dennis. A lot of people will know who it is that is being referred to.

Who else has opened up so many wild parts of Melanesia by having airplanes land in them?

In 1949, fresh from school at Bathurst, New South Wales, young Dennis Buchanan replied to an invitation to apply for a job with a Papua New Guinea aviation business.

Fifty-one years later Sir Dennis Buchanan, chairman of Flight West, one of Australia's busier regional airlines, is a resident for a good part of the year of Port Vila, Vanuatu. He's wrapping up the disposal of his assets there and in Papua New Guinea, prior to retiring, sort of, to Australia.

Buchanan founded Talair, eventually Papua New Guinea's biggest domestic carrier, launched Air Melanesia in Vanuatu and founded what eventually turned into Solomon Airlines.

He had ideas about Fiji Air, now Air Fiji, as the core of a Melanesian regional carrier.

He folded up Talair in 1993 after, he says, seeing the writing on the wall for domestic privately owned airlines flying in a nationalistic environment.

Although he had harsh remarks about the style of government in Papua New Guinea, where he briefly also owned a daily newspaper, Papua New Guinea felt that he deserved its recommendation for a knighthood.

Flight West, launched in 1987, is the main Queensland regional carrier, operating five Fokker jets, six Brasilias and four Jetstreams. It opened flights to Papua New Guinea in 1999, but suspended them in response to Papua New Guinea's worsening economic and security climate.

In Australia two new domestic airlines, Impulse and Virgin, have just begun attacking the dominance of Qantas and Ansett or are readying to do so. "It won't have any ill effect on Flight West because we are a regional airline and none of the routes or sectors we operate over will be flown by Virgin or Impulse," Buchanan told Islands Business.

"We are content to operate in Queensland and are looking at Norfolk Island and probably Noumea. We'll review Papua New Guinea. Honiara and Port Vila are other opportunities. It is all subject to traffic, which is not great, and with the facilities such as hotels you can't bring any more people into Port Vila.

"With trouble in the Solomons and Papua New Guinea, the only area of opportunity is Noumea. It gets only about 16,000 Australian tourists a year, which is a bit of a joke with 40,000 into Port Vila and 40,000 into Norfolk. With Noumea's hotels the operation could be expanded. But to get the support of the French authorities for an independent operation is very difficult.

"Papua New Guinea is currently too uncertain. We see no opportunity to take tourists there because there is so much lawlessness and until that is resolved it would be silly to even start. When there's some semblance of law and order we will have to reconsider it."

Buchanan's long record in Papua New Guinea makes him a natural candidate as a possible private enterprise rescuer for the financially troubled and 100 percent government owned national carrier, Air Niugini. "It is not running very successfully and I think privatization would be an avenue for them to save money on which they could spend on law and order," he said. "But they are so nationalistic they don't want to privatize."

A Vanuatu newspaper recently reported his interest in taking over Vanair, the government-owned domestic airline, which has its roots in Buchanan's former Vanuatu airline, Air Melanesie. "I just floated the idea in the newspaper. Currently the government is not interested, but it is an area they should look at because it would get a lot more efficiency into the two airlines.

"I would have thought the country couldn't afford two airlines (Vanair and the international carrier Air Vanuatu). They should have only one and rationalize the whole industry here. It's the way they think here in the Solomons and Papua New Guinea. You can't explain commercial enterprise to them."

Buchanan, 67, has lived in Port Vila since 1994. "I've had my affairs set up here and I intend to return to Australia to retire. But I'm semi-retired here and I've got assets I want to sell off before I return to Australia.

"I go to Australia for part of the year to see what Flight West is doing and then go to Papua New Guinea to try to organize the last of my assets there; staff housing in Port Moresby's worth about Kina 5.5 million (US$ 2,158, 750). If I could wind up my affairs in Papua New Guinea I would be a lot more comfortable."

As chairman of Flight West, a family company, he's "totally responsible for over 400 staff, which is quite a large responsibility and which makes sure Flight West remains viable."

Flight West started in 1987 the year Buchanan left the Solomon Islands after the government took over the airline he had there. There's just one aspect of the outcome of his Melanesian airline career that he regrets. "They only thing is that they have not joined together. I would have liked to see them merged and with Air Pacific they had a great opportunity to have an airline running like Qantas is running today.

"But it was too political. When I was in the Solomons the Solomons didn't want to talk to Fiji and wouldn't even send me over as a representative for their shareholding (the Solomon Islands Government with other governments still own small stakes in the Fiji carrier). It was the same here (Vanuatu); they didn't send anyone. None of them would cooperate with each other and I thought that was very disappointing. Then they set their own airlines up and they still don't talk to each other."

Now, he told Islands Business, regional airlines were moving to regional jets and turbo props. Ultimately they will have to have regional jets and the regional jets are expanding so rapidly in America that something is going to have to happen here.

"But we are all about five years behind America. With 44-seat or 50-seat regional jets they will be able to run right round the Pacific where they used to run the BAC 111 or Boeing 737. They will be able to run little jets with increased frequencies, and I think it will be a boon to the whole Pacific.

"Despite the handicaps of the peculiar environment Pacific Islands regional airlines all have good prospects," Buchanan said. "It is how they work their bilateral agreements, how they carry people all the way through. Code sharing has to come; that has to be the salvation. I don't think the traffic is there for them to bother about. Qantas has its One World and Ansett is in Star. We are virtually a pseudo-member of Star being in the Ansett camp in Australia."

Talair closed abruptly in 1993 because Buchanan felt that Papua New Guinea government's aviation policy and attitudes had become loaded against him. It was then the country's biggest internal airline. "I've had no choice since these countries become independent," Buchanan said. "I was aware of that. I knew my days were numbered. But I tried to offer them a good service to try to show them it could be done."

Talair began business with a DH 84 and then a Cessna 170. It was described by some as being the world's largest third level operator. "That's a bit bullshit; we had 71 aircraft in Papua New Guinea and with aircraft in Vanuatu and the Solomons: we had about 90 in the 1980s, when we topped our thing and I decided that we're not going to go any further. Costs-wise and as independence came, there was less money to travel with and there was no charters any more, so you had to wind your business back. When I went to New Guinea in '49 we didn't have any radio. We flew by the compass. You used to take off and do a flight and if the aircraft didn't come back that night we had to start thinking about where he was. The next day we'd send an airplane out to find him. Sometimes you'd find him in the bush, but it was a remarkably safe operation despite the lack of navigation aids and the nature of the bush airstrips. You just cut them out of the bush and went and landed there.

"It was a great time. At west of Hagen there was no airport when I first flew in '49. It was all big bush and the people were in the Stone Age."

Flight West is an entirely family-owned airline. Buchanan's son, Guy, is general manager; another son, Fred, is an electrical engineer with the airline's avionics departments; and one of his daughters, Caroline, works for the airline also.

Buchanan intends to remain the airline's working chairman until "probably about 70. My family will be taking over. Qantas are talking about buying new aircraft for several billion dollars. That is as much as the shareholdings worth.

"Ansett still has to decide on their fleet renewal. It's all high capital cost. The current return on airlines is very low. Some change has to come where the shareholders in these airlines get a reasonable return on capital on their investment. I doubt if any airline is getting a good return on investment. If you had any brain you wouldn't invest in them."

For additional reports from Islands Business, go to PACIFIC ISLANDS REPORT News/Information Links: Magazines/Journals/Fiji Islands Business.

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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