Wednesday, January 18, 2017

Air Serbia considering Croatia expansion

Air Serbia is mulling the possibility of introducing flights to both Zadar and the island of Brač in Croatia this year. Speaking to the "Avioradar" portal, the General Manager of Brač Airport, Tonči Peović, said, "We have been in talks with Air Serbia for a number of years. I met with the company's CEO recently. They are interested in flying to Brač. They are considering linking the flights with Zadar. Introducing services from Belgrade is a high priority for them with an ATR 72-500 aircraft". On the other hand, the General Manager of Zadar Airport, Irena Čosić, said last month, "It is unfortunate that we have been unable to introduce direct flights between Zadar and Belgrade with Air Serbia. We have been trying to do so for the past two years and reach an agreement but we have been unsuccessful. There are some higher up forces involved but I hope we will succeed in the end".

News of possible flights between Belgrade and Brač were first made public in 2015 when Croatian media reported that Air Serbia would begin a one weekly seasonal service, each Friday, from the Serbian capital to the island in May of that year. However, the carrier rebuffed the claims, noting it had no immediate plans to fly to Brač. During May 2015, talks between Zadar Airport and Air Serbia began over the potential new service, with Ms Ćosić holding talks with the airline's management. Despite negotiations, the service was never launched. Last year, Zadar Airport told EX-YU Aviation News that the route failed to materialise "partly because of the cancellation of financial support on behalf of the Croatian Tourist Board". It added, "This service would have been a great opportunity for Zadar because we know the route would have excellent loads. Zadar Airport will continue to negotiate and persist in having a Zadar - Belgrade connection just like other Croatian airports, such as Pula, Zagreb, Split and Dubrovnik".

The new services, if launched, would become Air Serbia’s fifth and sixth destination in Croatia, following Zagreb, Dubrovnik, Split and Pula, with the latter three operating during the summer months only. For the upcoming summer season, Air Serbia plans to maintain double daily flights to Zagreb, six wekly to Split and Dubrovnik, as well as four weekly services to Pula. These frequencies are preliminary at this point and may change in the lead-up to the summer season. In contrast, Croatia Airlines runs a seasonal service between Split and Belgrade, which is scheduled to operate three times per week during the 2017 summer season. The last scheduled commercial flight between Zadar and Belgrade was operated by JAT Yugoslav Airlines on August 3, 1991. There have never been services between the Serbian capital and Brač.

Etihad defends equity investment strategy


Air Serbia's part-owner, Etihad Airways, has defended its strategy of investing in a number of airlines, noting that the policy has delivered revenue and synergy benefits. The President and CEO of Etihad Aviation Group, James Hogan, said the Emirati carrier is already seeing a return on investment from Air Serbia, among others. “Our investments had an immediate impact on the revenue side, delivering hundreds of millions of dollars in additional revenues and allowing us to fill our onward connecting flights. Those benefits have been replicated in all our minority investments – in Air Berlin, Alitalia, Jet Airways, Virgin Australia, Air Serbia, Air Seychelles and Etihad Regional", Mr Hogan said yesterday. He added, "We have had some strong results but we also face some significant challenges. Jet Airways, Air Serbia, Air Seychelles, Virgin Australia and Etihad Regional have all used our capital investments to help structure their businesses into more efficient and profitable operations. In those cases, our long term investments are already delivering a return. However, we have faced greater challenges with Air Berlin and with Alitalia. Both are operating in very tough competitive environments, and need to address long-standing issues facing their businesses. I believe Air Berlin’s strategy is now on track and Alitalia is finalising a business plan to address its issues". Mr Hogan reiterated that Etihad is committed to its equity partner strategy, noting that, "Some of those airlines need to react to the market pressures they face, and we are supportive of that process". Etihad's strategy of investing in fledgling carriers across the world has been under scrutiny recently with ongoing financial issues at Air Berlin and Alitalia. Etihad yesterday rebuffed speculation it was in talks of taking a 30% - 40% stake in Lufthansa. Late last year, the Emirati carrier also denied rumours it would disinvest from Air Serbia, noting it was "fully committed" to the partnership.

ČSA temporarily suspends Zagreb


ČSA Czech Airlines will temporarily suspend flights between Prague and Zagreb this winter. The carrier will operate its last service on the route on January 27. Operations will resume twice per week, each Monday and Friday, from February 27. Initially, ČSA planned to run Prague - Zagreb - Skopje flights this winter but cancelled the Skopje leg of the journey. The service between the Czech and Croatian capitals is codeshared by Korean Air, Delta and SmartWings Airlines.

Tuesday, January 17, 2017

Montenegro Airlines in crisis mode

The Montenegrin Civil Aviation Agency is keeping a close watch on Montenegro Airlines as part of the carrier's fleet has been grounded, while the country's Prime Minister has ordered an urgent review into the company's business. Montenegro Airlines has been beset by a number of issues since the start of the year, with three of its aircraft grounded due to technical problems, while the majority of its first officers have gone on a silent protest due to unpaid wages. "Immediately after receiving word that part of the airline's co-pilots have not shown up to work, the Agency took measures to asses passenger safety. Based on preliminary reports, we cannot conclude that the safety and wellbeing of passengers has been compromised. However, our safety inspectors continue to monitor Montenegro Airlines and will use all legal means if necessary to protect travellers. The company is facing serious problems but has managed to maintain operations and adhere to the law for now", the head of the regulator, Mileta Nikolić, said.

Montenegro Airlines has been forced to cancel a number of services over the past week with only two of its aircraft operational. One Fokker 100 jet has been grounded at Belgrade Airport since January 1 with an engine problem, while an Embraer E190 has been parked in Podgorica awaiting spare parts. According to Montenegrin media, the company has been unable to purchase the spare parts immediately due to financial issues, however, the aircraft has been repaired over the last few days. Last Friday afternoon another of the carrier's aircraft was grounded after it was hit by lightning. Montenegro Airlines previously said it would maintain operations with four aircraft this winter season (three E190s and one F100), while an additional F100 jet would be used only if necessary. The carrier is looking into concluding a short-term wet-lease of aircraft and crew from Air Serbia in order to carry out its planned operations in the coming days, reports suggest.

In a statement, the office of the Prime Minister of Montenegro said, "The President of the Government of Montenegro, Duško Marković, has instructed the Minister for Transport and Maritime Affairs, Osman Nurković, under whose portfolio the state-run Montenegro Airlines belongs, to promptly prepare and submit detailed information about the current situation at the national carrier. The Prime Minister has requested an urgent and comprehensive report concerning the recent problems at Montenegro Airlines. Furthermore, Prime Minister Marković has also asked for detailed information on the overall state of the company's finances and human resources, stressing that the current issues need to be resolved as soon as possible". In a recent interview, Mr Marković said, "The government holds a 99.9% stake in Montenegro Airlines and can offer 50% minus one share to a foreign partner. In the coming period, the government will work on stabilising and improving the company and consider privatising it. A minority stake would be offered through an eventual tender".

A number of high profile resignations have swept Montenegro Airlines over the past six months starting with its Chief Commercial Officer in September 2016, followed by the head of Safety and Security in October, as well as the President of the Board of Directors, Daliborka Pejović, in December last year. As a result, new members of the Board, as well as its head, will be selected on January 27. Montenegro Airlines faced a difficult 2016 during which the government cut its financial support for the carrier. The company was also forced to return one Embraer jet to its owner as it was no longer able to afford the financial lease. In 2015, Montenegro Airlines recorded a loss of 10.4 million euros, while its debt amounted to over sixty million euros. The carrier has reported that its finances improved throughout 2016 but its financial report is yet to be published.

Belgrade starts second phase of terminal overhaul


Belgrade Nikola Tesla Airport commenced work on the second phase of the overhaul of its Terminal 1 building on Sunday. During this time, the hall connecting terminals one and two will be closed off to passengers, who will be able to access both buildings using their respective entryways. Check in and passport control will be unaffected at Terminal 1 during this time. The overhaul entails capacity expansion, new commercial space and a new automated baggage sorting facility. The newly refurbished hall between terminals one and two will feature 28 new check-in desks. Work is expected to be completed by April 2017. Earlier this month, the airport opened a new de-icing platform and outlined further infrastructure projects planned for 2017.