Financially troubled Chrono Aviation might stop carrying Nunavut miners
Baffinland in ‘discussions’ about airline’s support to its workers: Company spokesperson
The future of Chrono Aviation’s relationship with Baffinland Iron Mines Corp. is up in the air after the airline was put under administration last month to sort out its finances. (File photo courtesy of Summit Air)
Financial troubles might cause Chrono Aviation to lose its contract transporting miners in and out of Baffinland’s Mary River iron mine, and Summit Air could potentially step in.
Chrono Group, an aviation firm that includes Chrono Aviation, filed for creditors’ protection in October and was put under administration by the Quebec Superior Court after a report showed the company had $74.2 million in liabilities.
Baffinland Iron Mines Corp. is one of Chrono Aviation’s bigger clients. The airline provides charter flights for workers travelling to and from the mine, which is located on northern Baffin Island.
“We are currently in discussions over the long-term aviation support for our staff at site,” Peter Akman, a spokesperson for Baffinland, said in an email.
He did not provide further details.
Nunatsiaq News became aware of the talks during an interview with Duane Wilson, vice-president of Arctic Co-operatives Ltd., which subcontracts Chrono to provide the transport service for Baffinland.
The changes to the airline’s financial situation have forced the mining client to “pause and consider whether they are able to meet the terms of the service expectation,” said Wilson.
“[The mine] has come to the conclusion that the answer to that is no, and that they would be better served by the alternate carrier.”
Arctic Co-op had been part owner of Chrono since 2020, but pulled out recently during the airline’s court administration process, Wilson said. Now, it merely subcontracts Baffinland employee transport services for the airline.
The mining company has decided to “independently evaluate options and initiated discussions with Summit Air,” Wilson said.
Along with flying mine employees, Chrono Aviation had begun selling extra seats from Montreal to Iqaluit to members of the public.
However, in November, it announced it will no longer sell these tickets because of difficulty securing the aircraft it originally planned to use. But the service it provides to Baffinland wouldn’t be affected, it said.
“We will continue operating these flights as before using our Boeing 737-200 aircraft,” David Sade, the company’s vice-president of operations, said in an email Nov. 21.
On Nov. 26, when asked about the potential change in carriers, Sade said Chrono’s “service obligations remain unchanged at this time.”
Summit Air did not respond to an inquiry by Nunatsiaq News.
Summit Air was the airline to take the Baffinland employees to the mine on Saturday! So the discussions with them must be going well.
Chrono has over $74 million in liabilities. In a splendid case study in hubris the airline’s rapid expansion seems to have been fueled more by ego than by cash flow. Though perhaps well intended, the acquisition of the passenger 737-800 seems to have been poorly managed and thus badly bungled. This could be an indicator of further ingrained ineptitude and inefficiency throughout the company.
Once companies are consistently behind in paying their bills they lose all credibility with both current and potential suppliers, so continuing to serve customers becomes ever more complicated, thus operations become less dependable. If airlines have not paid their fuel bills the availability of fuel in the future may not be assured. It is wise for all stakeholders involved to develop contingency plans should Chrono’s assets (including its aircraft) be seized as part of the debt collection process. Access to leased aircraft seems to have already been lost, so if Chrono experiences a serviceability interruption with any of its aircraft the lack of access to a leased replacement could result in service interruptions. How will Chrono pay for its next heavy maintenance checks? Who will want to do business with an airline that may not be able to pay its bills?
Once an airline’s management team lose the confidence of suppliers and customers that confidence is very difficult to regain. If EIC does not see Chrono as worth investing in, is the airline worth trying to save?
Seems to me that chrono is managed the same as Baffinland Iron Mine greed over selling went big way to quick and now a disaster
Guys, so what do think is it over with Chrono or they will get rid of those 200s and focus on a private jets?