Friday, June 23, 2017

Air Serbia’s transatlantic service one year on

Today marks a year since Air Serbia launched its first transatlantic service between Belgrade and New York with the carrier upbeat on the route’s future prospects. Over the past year, the airline operated 204 flights between the two cities and says it has witnessed strong and growing passenger load factors. “Air Serbia is delighted to be celebrating one year of successful operations to New York, where we began flying on June 23, 2016. Our flight was widely anticipated in Serbia and Southeast Europe for two reasons: it reconnected Serbia to the US with the first Serbian-operated flight since 1992, and it established the only year-round transatlantic air link to the US originating in the region”, an Air Serbia spokesperson told EX-YU Aviation News. They added, “It is especially satisfying to see that the mix of traffic is balanced, with 47% of guests originating from North America and 53% coming from Europe. The reaction from the Serbian diaspora in North America has been exceptionally positive, as predicted, and the service has also been welcomed with open arms by communities from other countries of the former Yugoslavia”.

The airline has worked hard to market the flights in the wider region, with the service proving particularly popular with travelers from Montenegro and Albania. “The flight has captured strong travel demand from countries neighbouring Serbia, with high volumes of connecting traffic from Montenegro, Albania, Greece, Macedonia and Croatia. This has driven the growth of tourism arrivals from America, and we are particularly seeing a large number of holidaymakers who are combining a visit to Belgrade with an onward trip to the Adriatic coast”, Air Serbia said. Over the past twelve months, the Serbian carrier has concluded partnerships with jetBlue, which allows passengers to connect from Belgrade to major cities across the States with one stop in New York, as well as American Airlines, which has opened up travel options for passengers flying to the mid-West and cities which are heavily populated with people who originate from the Balkans, such as Cleveland.

Ethnic travel agents in the United States have said that following an initially slow response by the flying public to the Air Serbia service, bookings and interest have significantly picked up. Travel agency Axioma Travel, which caters to the ethnic market and diaspora from the former Yugoslavia in the US, told EX-YU Aviation News, “Last year’s launch of New York – Belgrade flights was highly anticipated but at the same time met with quite a bit of scepticism. By the time ticket sales started, many potential customers had already purchased tickets on other carriers. Others waited as they were afraid the flights would be late, subject to government approval, and that the on board service would be poor. For its part, Air Serbia was slow to roll out competitive interline agreements to link JFK with points where ethnic customers live”. However, Fedja Stepanovich, the head of Axioma, noted, “Since the start of flights in June of last year, Air Serbia’s sales team worked with the agent community to develop programs and incentives to raise brand awareness, improve interline links, and, most importantly, listen to customers and agents about what was needed to boost sales. News of the impressive on-time record and great on board service quickly spread through the ethnic community and the phones started to ring”. He added, “In the same period this year, Axioma Travel's sales on flight JU500/501 have grown almost tenfold. Customers from cities like Phoenix, Cleveland and Jacksonville for the first time in several decades now have a one-stop flight to Belgrade. And they started to line up to buy the tickets. On many flights this June we have booked forty, fifty or even sixty passengers on a single flight”.

Questions have been raised as to whether Air Serbia can sustain a large investment such as transatlantic operations, however, the airline says the route is a long-term commitment which will take several years before it reaches its full potential. The carrier has also generated revenue on the route from other streams such as cargo. “Air Serbia's cargo operations are performing above all expectations. The airline's uplift capacity to JFK, which is fifteen tonnes per flight on the Airbus A330, is in high demand. We are transporting a wide variety of goods to the US and onwards to Canada and countries in South America, including textiles from Romania, Italy and Turkey, automotive parts and gaming industry machines from Bulgaria, and Serbian fruits and mushrooms, to name a few. From the other direction, there are even regular shipments of cargo from Ecuador and Argentina being sent to the region on board our service from JFK”, the airline said. Going forward, local agents in the US say areas of improvement and opportunity include more progress in interline connections to other US cities, better timed schedules to Sarajevo, Banja Luka and Podgorica and capturing more passengers from Chicago, Los Angeles, Seattle and others that already had established one-stop connections (through Lufthansa, Austrian, Swiss, Turkish Airlines etc) to Belgrade and other cities in the region.

PHOTOS: AtlasGlobal launches Sarajevo


Turkish carrier AtlasGlobal inaugurated flights between Istanbul Ataturk Airport and Sarajevo yesterday, becoming the third airline to maintain services between the two cities. AtlasGlobal will run four weekly flights to the Bosnian capital, each Monday, Tuesday, Thursday and Saturday, with its 164-seat Airbus A320 aircraft, featuring eight seats in business and the remaining 156 in economy class. Sarajevo becomes the carrier's second destination in the former Yugoslavia following Belgrade, which was introduced earlier this year. The General Manager of Sarajevo Airport, Armin Kajmaković, said, "We are delighted that AtlasGlobal, with its fleet of 26 modern Airbus aircraft, which flies to fifty destinations in 35 countries in Europe and Asia, has recognised Sarajevo and Bosnia and Herzegovina as a perspective leisure and business destination. With this scheduled service, passengers have even more options to fly to Istanbul, which is one of the biggest transfer points in the world". AtlasGlobal said it expects for the service to go daily as it sees potential on the market.

Vueling upgrades Dubrovnik service


Low cost carrier Vueling will extend its seasonal summer service between Rome and Dubrovnik into the winter months. Flights will operate twice per week past October 31 with an Airbus A320 aircraft. Tickets are already on sale through the airline's website. Initially, Vueling planned to run the route during the 2016/17 winter, however, those did not materialise. Croatia Airlines discontinued its year-round Dubrovnik - Rome service last year, and now maintains only summer flights between the two cities.

Thursday, June 22, 2017

Belgrade concession bidders outline plans

Several of the four consortiums and one company that have qualified to bid in the second and final phase for the 25-year concession to operate Belgrade Nikola Tesla Airport have briefly outlined some of their plans. According to the Serbian government, the non-bindings offers received during the first phase of the bidding process have exceeded expectations and are eight times higher in value than anticipated. Serbia, which has an 83.1% stake in the airport, expects the upfront payment for the deal to be worth around 400 million euros. China's HNA Airport Group, which is bidding jointly with subsidiary Hainan Air Travel Service, as well as China National Aero Technology, is still believed to be the front runner.

Qualified bidders

As part of their plans, the Chinese intend to invest on several fronts, including infrastructure development, which would be dedicated to China National Aero Technology, while Hainan Air Travel Service would be tasked with pulling in a significant number of Chinese tourists to Serbia and devising a wider investment strategy for tourism development across the country. The HNA Group also plans to establish and run a pilot training centre. On the other hand, Incheon International Airport Corporation with its Turkish partner plans to expand the airport's capacity as quickly as possible. "We are formulating a strategy to develop Nikola Tesla Airport into the main international hub in the Balkans. We want to expand capacity as quickly as possible. The average annual passenger growth rate at Belgrade Airport is 7%. Based on that, we want to formulate a high-quality plan that will expand the airport in line with growth, while at the same time offering comfortable and seamless travel for all passengers", representatives from South Korea said. They would also evaluate the possibility for the introduction of nonstop flights between the two countries. The South Korean and Turkish duo also bid in Zagreb Airport's concession process several years ago.

Shares in India's GMR Infrastructure touched a 52-week high yesterday after it was announced that its bid for Belgrade Airport had advanced. The Indian infrastructure conglomerate, with interests in airport, energy, transportation and urban infrastructure, has teamed up with GEK Terma from Greece following their successful bid to develop, operate and manage the new international airport in Heraklion. After their meeting with officials from the Serbian government earlier this May, it emerged that GMR itself would be responsible for building new and updating existing infrastructure at the airport, while GEK Terma would formulate a profit-making strategy and be involved with the managerial side of the business. Meanwhile, the Franco-Swiss bid, comprised of Meridiam, Eiffage and Zurich Airport aims to "expand and improve the airport’s infrastructure to achieve its maximum growth potential by utilising the best management practices", EX-YU Aviation News was told in a statement. The consortium's mission will be to offer "best quality services to passengers, airlines and other stakeholders".

The five entities now have 75 days to formulate their binding bids. Besides a financial offer, they will have to submit a market tactic development strategy, a detailed airfield development plan, terminal development concept, a capital expenditure plan, as well as a business and operational plan, to name a few. The Public Body overseeing the concession process will then score each category out of ten and will have thirty days to announce the winner. It reserves the right to extend deadlines for the submission of binding bids at any time. The Serbian government has said it expects for the entire procedure to be completed, and for the deal to come to a financial close, by year's end.

Score sheet - phase two

Podgorica Airport's passenger numbers soar


Podgorica Airport has registered its strongest May on record by handling 79.581 travellers. The figure represents growth of 19.1% compared to last year. During the first five months of 2017, Podgorica Airport welcomed 305.663 travellers, up 24.2%. Of those, 152.148 were arriving passengers and 153.515 departing. Podgorica Airport has witnessed a number of new destinations launched this summer including Budapest (Wizz Air), Warsaw (LOT Polish Airlines), Athens (Aegean Airlines) and Stockholm Skavsta (Ryanair).

MonthPAXChange (%)
JAN50.799 23.4
FEB46.738 18.8
MAR56.052 22.1
APR72.493 37.1
MAY79.581 19.1