Friday, September 18, 2009

Jat Airways hands in strategy

Jat hoping for larger passenger queues
Jat Airways’ CEO Srđan Radovanović yesterday, a day before the deadline expires, handed in the airline’s short, medium and long term business strategy. Radovanović has said that he can not comment on all of the contents of the report until it is read by the government, after which it will be made public. He did however uncover some of the plans the airline has for future development. In order for the carrier to operate with a profit it must carry some 1.5 million passengers annually. “Our current fleet can accommodate this capacity but only if all 16 of our aircraft are operational”, Radovanović said. Currently 3 of Jat’s Boeing B737-300s are being used for spare parts and are, as a result, grounded. “Together with the Serbian government we hope to have all 16 of our aircraft in the sky next year”, Radovanović added. He also said that last year the airline carried 1.3 million passengers while this year the number is expected to fall to 1.1 million. The airline is expected to report losses of 20 to 25 million Euros by the end of the year.

The strategy outlines that a reorganisation inside the airline must occur and that greater financial discipline must be practised. The strategy outlines that one of the major sectors which must be modified is scheduling, that is the time at which aircraft depart. The report states that the time of departures must be modified according to the needs of the majority of the passengers. The strategy also outlines that the service on board and the flight experience must be improved. Another big plan for the airline is greater involvement in the region with more flights to cities in the former Yugoslavia. Jat is also planning to join an alliance and is considering either Lufthansa’s Star Alliance or Air France-KLM’s Skyteam.

Radovanović states that his goal is to create a modern airline based on modern management principles. “We exist for our passengers, country and the people and as a result we have a responsibility towards the government and the citizens of Serbia, our passengers and business partners”, Radovanović said.

7 comments:

  1. I really hope that Serbian Airlines (JAT AIRWAYS) is enjoying the Star Alliance network because Adria Airways and Croatia airlines using also Star alliance, and if the whole balkan region use the same network it would be much more better connections between flights! / Philswe

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  2. I hope this means a new begining for JAT and that some better days are ahead. Would be nice to see JAT expand across the Balkans but im affraid that the ATR72's are a bit too big for some destinations (ie: Banja Luka, Ohrid, Sarajevo)

    @ anonymous

    i disagree that JAT should enter the star alliance network. It would end up as another feeder carrier to Lufthansa. That and 2 airlines from the SkyTeam alliance have shown support for JAT to enter the alliance (1 being Air France). How does airlines from the Balkans joing a single alliance affect conectability between flights?

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  3. I also do not support entering the Star Alliance. Unfortunately, flying the AirFrance was one of the worst flying experiences (Paris-Toulouse).
    So, I was wondering if JAT could be successful without entering any alliance? Or at least entering after the establishment of some inter-cont lines?

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  4. IMHO Jat is not in a good position to join any alliance whatsoever, although if I'd have to choose between Skyteam and Star Alliance I would MOST DEFINETLY choose Skyteam.

    Bash Air France and Alitalia if you want, but look what LH will force Jat to do if it joins star: OU doesn't have a single destination east of Skopje.

    As for avoiding fleet renewal, Radanovic is only postponing a seemingly small problem that will come back to bite him or the company in the near future. Yes, the 733s are good and capable planes, but making an investement in atleast the smallest of fleet renewals could be less expensive than trying to keep all of those 733s in good shape for the next 5-10 years.

    Can't wait until openskies kicks in....I just want those hordes of newcomer airlines to teach these naive CEOs and politicians not to crap on the image of Jat with their stupid business plans.

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  5. Maybe this was not released yet but nothing was mentioned about employment numbers. Could it be that the Unions are the real CEO's of Jat and as a result no new CEO, no matter how inspired he/she is could ever get Jat back into a positive position?

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  6. Woah! A business plan?? This new CEO might actually be on to something here, if only he gets the support of government. Although 1.5m will wear out what's left of the fleet pretty quickly!

    Agree with the above comments re fleet renewal being important - perhaps taking up second-hand 717s might be another cost-effective solution (they're Boeing aircraft, not too old, about the right size, and many operators are replacing them). However, it doesn't solve the issue of aircraft for the future.


    @ Philswe

    You're kidding right? Connections between where: FRA or MUC? Don't rule out oneworld for JU if the problems at Malev are as bad as what people say...


    @ Q400

    Interesting point. They'd need to keep on with the numbers if all planes are in the air (but how do you explain the pathetic Media Centre?). That we will only find out if the whole document is released to the public...

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  7. I forgot to mention - another option for second-hand 737s will be the ex Olympic Airlines ones which become free at the end of the month. 3 733s and 13 734s could be quite handy - and the 734s would be a lot newer than most of JATs fleet...

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