GIFF JOHNSON
The Marshall Islands has put a downpayment of nearly $2 million for new airplanes for Air Marshall Islands.
The total purchase for two new 19-seat Cessna SkyCouriers will cost the national airline close to $20 million. The purchase is part of a major effort to revamp air service in the country.
“We’ve been talking about new AMI plans for the longest time,” said Finance Minister David Paul. “This was an easy proposition.” Cabinet support of a decision to purchase the two new planes came following a briefing by AMI board and management of the options, he said.
The government’s role is providing the deposits and organizing a long-term, low-interest loan for AMI to purchase and own the planes, said Paul.
Two down payments have been made so far, with the second payment, of $700,000, issued Tuesday this week. A third similar payment is due in March next year and the final over $16 million due in December 2025 around the expected delivery time.
AMI CEO Captain Albon Jelke confirmed that the first plane is expected to arrive in December 2025 and the second one in January 2026.
This is part of a bigger reinvention of AMI’s domestic fleet, said Jelke.
“AMI is also pursuing the purchase of another Dornier 228 (and) the sale of the Dash-8 aircraft,” he said. “So AMI should have in its fleet three Dorniers and two (Cessna) Couriers. AMI’s plan is to utilize two Dorniers to do cargo runs and the other Dornier and the Couriers for passenger runs. With five aircrafts in our fleet, AMI should be able to accommodate commercial demands and serve the outer islands communities with minimal disruptions.”
Paul said that “AMI has the revenue base” to support repaying a loan for the purchase at a rate of around $1 million annually for 20 years, which is the term being negotiated. The Finance Minister said the government was talking with two financial institutions and whichever offered the best deal would be selected.
AMI’s FY2022 audit shows that it had net operating revenue of $7.6 million against net operating expenses of $7.1 million.
“AMI needs to look at reducing costs to enhance its revenue,” Paul added.