Lulutai Airlines (L8, Tongatapu) is breaking even after years of losses, the Kaniva Tonga digital newspaper reports citing Tonga's deputy prime minister, Taniela Fusimalohi. At the same time, the government has reportedly ruled out additional funding any loans for the airline in this year's budget, saying there was enough interest from potential investors in the private sector.
One of those potential investors is New Zealand's Sunair Aviation (Tauranga), with which Lulutai Airlines is said to be in early-stage talks. The government is reportedly supportive, saying Sunair's operational experience would be useful to help Lulutai overcome its day-to-day reliability challenges. If a deal is reached, it would be the first foreign investment in Lulutai.
Lulutai Airlines has faced significant financial losses since commencing operations in 2020 and has relied on state loans and investment from a local pension fund to stay afloat. Its problems were exacerbated by the refusal of its insurer to cover damage to a Saab 340B in late 2023. Earlier this year, the government said it would conduct a review of the airline and its finances with a view to making it fit for sale.
Currently Lulutai Airlines operates three aircraft, a DHC-6-300, a Harbin Y12, and a Saab 340B damp-leased from Air Chathams. It flies from Tongatapu to Eua, Ha'apai, and Vava'u.
