Wednesday, October 14, 2009

Zagreb - Belgrade soon?

Belgrade calling
A long running air dispute between Croatia and Serbia will most likely come to an end in a month when a new bilateral air agreement is expected to be signed between the two countries, Božidar Kalmeta, the Croatian minister for sea, transport and infrastructure announced yesterday. After the new agreement is signed Jat Airways will be able to fly from Belgrade to Pula on a year round basis, rather than the current summer service only. The Serbian national carrier will also be granted rights to begin services from Belgrade to Dubrovnik while in return Croatia Airlines will be able to begin flights from Zagreb to Belgrade. According to Kalmeta, Croatia Airlines could begin flights to Belgrade during the 2010 summer season.

The two countries can not agree about who should be controlling the skies above Osijek, near the Croatian and Serbian boarder. Also, Jat has expressed the wish to link two Croatian cities from Belgrade on the same flight. Until now, the Croatian Civil Aviation Directorate was not keen on granting Jat such rights but after both countries ratified the ECA agreement, this can now become a reality.

Talks will begin soon and a new bilateral air agreement will be signed at the earliest next month or at the latest at the beginning of 2010. Jat has done exceptionally well on its services to Pula, which it resumed after many years in 2007 but has not shown any interest in commencing services to Zagreb saying that the route is unprofitable.

Do you think flights between Zagreb and Belgrade can be profitable? Send a comment.

24 comments:

  1. Of course the flights can be profitable. Croatia Airlines could be connecting the two largest cities within the former Yugoslavia. Just start with a smaller aircraft until people become more aware that there are flights! :)

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  2. This was expected and not at all a surprise to me. The new flights will be intresting to follow. Im sure the ZAG-BEG-ZAG flights would be connected in ZAG for flights in Europe, which is a good thing - more competition to JAT. I do hope however that OU and JAT sign a codesharing agreement on each others flights, JAT on the ZAG-PRN and the yet to launch ZAG-BEG and OU on the BEG-PUY and BEG-DBV routes :-) would be nice to see OU aircraft here in Belgrade :-)

    unapred zhelim dobrodo6licu Kroacija erlajnsa u Beogradu :-)

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  3. CA has several times repeted it has no plans for BEG service in the near future.
    Would it be profitable? The answer is almost certainly NOT.
    -the Q400 is too large to serve the route. Market size could maybe justify an aircraft such as EMB 120, J31 etc...
    -look at CA TGD fligts today. The load factor is around 50 percent on a good day. What would be the difference between TGD and BEG?
    Yes BEG is much larger but JAT would prove to be more of competition than Montenegro Airlines. Why would someone fly from BEG to AMS via ZAG when there is a direct flight?
    Don´t get me wrong I woluld LOVE to see this route happen but.....

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  4. I can't see it. SPU-BEG or some other Adriatic destination, but not ZAG. Croatia has a fantastic highway all the way up to Bajakovo, and once Serbian side (my side) smartens up and fixes the Belgrade-Bajakovo highway, the trip to Zagreb/Belgrade will be quick and, more importantly, cheap.

    I can see this route appealing only to businessmen (although, not much economic cooperation between the two countries) and some higher class people in Serbia, but I cannot see it as being profitable.

    My 2 cents

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  5. Anyway just the fact that there is going to be some kind of agreement is a step forward FOR A CHANGE! Even if ZAG-BEG doesn't work out, I am sure that BEG-PUY(all year around), BEG-SPU, BEG-DBV, even BEG-ZAD or BEG-RJK could "survive"... What about ZAG-INI? OSI-TIV via TGD all year around?! As all of you have already said this will wourk out ONLY with NORMAL PRICES, not FOR EXAMPLE app 180 euros SJJ-TGD!!! Is there any chance that some of the low cost airlines could get some local flights within EX YU region or that is only dream of mine :-( Pozdrav sporazumu izmedju Hrvatske i Srbije(konacno) i svima Vama :-))))

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  6. Agreed! it was about time burocracy gave way to common sense!
    One thing we have to remember is that airport monopolies are as big of a porblem in "our part of the world" as the air carrier monopolies are. Passengers are facing huge taxses and it appears that it is the air carriers ripping people off. This is because taxses included in the airfare. The most notorious example is SJJ airport. Out of those 180 Eur pax would pay for a SJJ-TGD ticket almost 50percent goes to tax. Which is why SJJ-TGD will no longer exist. I do not have the exact numbers (fare vs tax) but maybe one of you can does.

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  7. RE to pbe

    Great point! I just do not understand who has anything besides an empty plane! As, again, FOR EXAMPLE, such a short distance SJJ-TGD do not need any complemmentary drinks and food( Croatia Airlines doesn't serve on their domestic flights or at least I was not offered when I flew with them :-))) but isa a such a short distance and who is that desperate for a drink?!! I think these flight can do without that too and offer lower prices for unslod tickets and fill up the planes and it is a common sense that is better to earn even a penny rather than nothing as cabin crew are already there,pilot too etc.... Hope you have got my point!

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  8. If Croatia Airlines use the Q400 for flights to Belgrade, then YES, it will be profitable.
    I have friends who work for Qantas link, the airline operate the Q400 and they have told me on a number of occasions that they only need to sell 12 seats for Sydney Canberra to break even. That leaves about 60 seats worth of profit to the airline. The average price between Sydney and Canberra works out to be about 100 Euro's one way and this distance is around 60nm shorter then Zagreb to Belgrade.

    Even if you consider that the operating cost of Croatia's Q400 might be higher then Qantas (I don't know) and airport taxes may be higher in Zagreb, Belgrade compared with Sydney and Canberra, then you can assume that not many extra seats will have to be sold by Croatia Airlines before they make a profit.

    Just a side note, Qantas Link, a member of the Qantas group was the best performer in that group. With a large fleet of Dash 8 200,300 and 400's they posted a profit of $80 million Aussies, about 48 million euro’s last financial year

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  9. To Q400:
    I believe the breake even load on zag - beg would be comparable to other CA regional flights which is around 40. This is because:
    1. CA would not be able to charge premium for the segment ( proximity between two cities i.e competition form buses, trains, car transport).
    2. High airport charges/taxses
    3. Fuel price which is much higher ´compared to Australia ( again due to tax and no competition between fuel suppliers - in ZAG you can only buy fuel from INA or its counterpart in BEG.
    4. High overhead cost ( both CA and JU are suffering form excessive emplooyee numbers in the administration dept)
    Even if the breakeven point was as low as 20 pax, which from my first hand experience is not, you have to consider the "oportunity cost". Namely, why should CA assign an aircraft to ZAG BEG route and fly 25 pax barely breaking even when they could use that aircraft for a more profitable sector such as ZAG SKP and make a profit. This is especially true with no MAT around.
    Again, I know we all want to see this happen but we might have to wait a few more years. :-(

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  10. My opinion is that none of the ex-Yugoslav airlines will ever grow into something bigger or expand its intercontinental operations like JAT had in the past. Current market in ex Yugoslavia is too segmented and not viable for foreign airlines nor profitable for local operators.

    I know you will think I am nostalgic for JAT, but the only solution I see is to establish a common, whether it be national or private airline that would serve the ex Yugoslav area from 1 or 2 hubs connected with the rest of the world (something similar that SAS already does). Of course, for something like this there needs to be a lot of political willingness, which is a rare case in the Balkans today. If ex Yugoslav republics continue this kind of thinking and not cooperating, very soon all of them will see a demise of their national air carriers as we have already seen with Air Bosna and MAT.

    Sam

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  11. @ pby

    there is direct BEG-AMS flights, but there is also a BEG-BRU-AMS flight from JAT. If OU offered a good deal for tickets BEG-ZAG-AMS than it could attract passengers. There is double daily flight for example to CDG but my workmate flew LX via ZRH recently due to getting a better fare. TGD and BEG cannot be compared, 1 is that suburbs in Belgrade have more people than the whole of Montenegro and 2nd there is more business in Belgrade compared to Podgorica.

    Train transport in Serbia is unreliable, with delays longer than the actual travel itself.

    And car transport? you do know that Belgrade registered cars have luck staying untouched in Zagreb, and in Croatia in general? Even if you chose to go by car, flying in Croatia is generally cheaper than going by car considering high fuel prices, the toll ways....

    As of next year BEG will become amongst the cheapest airports in the region to encourage foreign airliners to fly to BEG.

    In my travels on the Belgrade-Bar train, ive met a couple of people traveling to Zagreb on the trains as OU was inconvenient for them.

    @ anonymous

    ZAG-INI??? no

    OSI-TIV-TGD? definitely no

    ---

    what is interesting to me is that no one mentions cargo. cargo also makes a route profitable.

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  12. This step is a long time in the making. The reality is it just shows the saying 'time heals old wounds' rings true: sure, there is still much bitterness following the hostilities 20 years ago, but each country realises the opportunities for working in a cooperative manner - ready made markets, common language (unlike other neighbours), joined together as one entity for much of the 20th century under a whole guise of names and forms...

    For mine, the issues are: flight times (OU must operate the flights to fit in with their waves to W.Europe as competition to JU) and ticket price - it's just too expensive for many to travel mostly due to absurdly-high airport charges. A twice-daily service first off (morning and evening) would probably suit best to build patronage, especially with the business community.

    @ PBY

    Spot on with the cost issue (those flights should be no more than 100 euros RETURN including tax), but aircraft economics with the Q are actually much better than many competitors that you mentioned, and even AT4/7s: so over time, if you are starting a new route you have room in the aircraft to grow profits without enormous overhead costs first off. The Qs base figures can be extremely low break-even hence why many airlines moving towards them.

    @ Q400

    Interesting comparison with QantasLink, which are a very effective and well run operation.

    CBY has always been a hard market for the Aussie airlines - its too close to SYD for any intl flights, and if that fast rail link was ever built would be interesting to see the flight adjustments. Also, DJ went and bought little E170s (or was it 195s) for the route also serving SYD, MEL and ADL as they just couldn't fill 737s...

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  13. In the far perspective (5-10 years) I think that BEG-ZAG won't be that very lucrative (as BEG-PUY), and that is for trains (it sound crazy I know).
    This would be at least my calculation:
    - Belgrade Center - airport 30min (optimistic)
    - 1.5 hours before boarding
    - 30min flight
    - 30min on the airport (passport control, etc)
    - 30 min airport - Zagerb
    Min. 3.5 hours
    Today if I take a train it's 7 hours, and it costs 40euro return - these are the people who don't have to afford the plain.
    In the end of the 80s it was 4.5 hours. The distance is 400 km, and several sections in both Serbia and Croatia are being raised to 160km/h (large no. of slow-rides is because of that). If they lower the travel time to 4.5h (and that is possible, since the longest delays are on the border), and there is initiative from OBB to run "fast" (easily achieves 160km/h and will stop only in Zagerb, and then in Belgrade) railjet train on Ljubljana - Zagreb - Belgrade. If the prices are alike, I would always chose the train. Simply I travel in more comfort without traffic to/from the airport.

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  14. The most sensible solution is for OU and JU to jointly offer sesonal BEG-PUY and BEG -DBV flights. So JAT would fly 135 while Croatia would fly 246. Coratia would face objections to this arrangement since it is only allowed to codeshare with Star Alliance members. The only exception is SPU-FCO route I believe.

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  15. @ frequentflyer

    every soccer match between the 2 countries you hear "ubi srbina" or "smrt ustashi", attacks in Belgrade on the Croatian embassy after their recognition of Kosovo, the request by people in Rijeka to bring down the Serbian flag when countries flags were put up for a sporting event...each country so far hasnt helped the situation much and the only major thing the respective governments have done is file war crimes cases against one another. I dont see things changing politically any time soon.

    @ Milosh DJerich

    The 7 hours you mentioned, is that including the hours long delays? My last train trip was from Budapest to Belgrade, the locomotive broke down in Ba4ka Topola and it took 2 and a half hours to get the problem sorted out - ended out to be a 3 hour delay into Belgrade. 4 hour delays for a train from Belgrade to Novi Sad is normal, even hour long delays happen for a trip from Vukov Spomenik to Novi Beograd which is only a 10 minute trip! I chose to go by train to Vienna for example because i had accomodation near Westbahnhof and going by train gave me 15.000 dinars more spending money in Vienna compared to flying with JAT, even though i prefer flying.

    Both ZAG and BEG airports are lowering airport taxes and both are attarcting competition, maybe we could see something good for passengers from the Yugoslavia region :-)

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  16. Could they not get business from people using Zagreb airport to fly to Europe using low cost carriers?

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  17. @ doot

    why would OU transfer passengers to their competitors?

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  18. @ JATBEGMEL:
    It is 7 hours without delay (if you go with IC, but if you take "local" it is almost 8 hours). I traveled 8 times during last few months between the two, and delays were up to 15min maximum.
    The rail corridor towards Croatia is much better, especially when you're going to Belgrade since from Šid its mostly 120km/h (and hopefully from Golubinci it will be 160km/h), but to Šid you can bike faster (I was bored so I was calculating the speed and it came to be from 30km/h to 70km/h).
    You also loose almost 30-45min to just get to Batajnica, and since the City is planning to invest in Beovoz, it will be 10-15min. Also there is much larger number of good parts where trains can compensate lateness.
    My advice is either the night train so you can sleep or the 10.30 from Belgrade - you have the Restaurant and can smoke there. I always get wasted - the best way to travel by train or inter-continental flights (love the free vine and vodka-orange with breakfast). :D

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  19. I don't think they'll transfer them, as such but, if there are LCC leaving from Zagreb, it might generate traffic on BEG-ZAG

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  20. Croatia Airlines VERY OFTEN have a great deals within Croatia to Split , Dubrovnik, Zadar, Pula, and with the same or similar taxes at the Belgrade airport I do not see the reason why they wouldn't offer similar deals on ZAG-BEG flights?!!! With these prices they would definitely attract lots of passengers!

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  21. By the way, talking about ludicres prices on ex Yu region, I have just checked, ONE WAY ticket with BH airlines From Zurich to Banja Luka is 500 KM (250 euors) :-( It has really made me sad as i I am desperatly trying to fly to my home town(that is my wish but with these prices it is just not possible :-(

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  22. The level of violence between Croatia and Serbia these days is very small! I Spent over 6 months in Croatia this year and saw Serbian resisted cars everywhere. I went to a Croatian wedding in BiH where we drove through both Serbian and Muslim villages, people came out and waved!

    There will always be individuals who will dwell on the past more then look toward the future but during my stay in Croatia I can just recall one instant reported in the news when Serbian cars were vandalised by some Croatians in Dubrovnik.

    Most people are upset and wish the war never happened and can see how it has effected there current circumstances.

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  23. @ Milosh Djerich

    I noticed coming back to Belgrade from Budapest (as the train was late and the sun was up) that there was alot of works being done which i was impressed with. I think soon the Belgrade-Bar railway line will be modified as well. As for Beovoz, i hope they intergrate it with the GSP markice system and have the trains run more frequently and on time. I like Beovoz...when it runs. From Novi Beograd to Vukov Spomenik instead of an hour trip by tram i takes me 10 minutes by train.

    For some strange reason i dont sleep when i travel so getting the train in the night or day is the same for me. Going to Vienna i was awake the whole 11 hour trip. Unfortunatly i didnt have alcohol. The good thing (sometimes) with Yugoslav people (Serbs, Croats, Macedonians...) is that we love to socialise and chat, and whether im next to a Macedonian woman on a JAT flight from Dubai to Belgrade or around Serbian people on the train to Budapest, you always have a loooong conversation, being in Yugoslavian, Macedonian and that tends to kill time. Politics is the biggest topic lol.

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  24. @ JATBEMEL: And it's easier in the bar (my friends and I call it "kotrljajuca kafana"), especially on Belgrade-Zagreb. Last few times we had our bottle of vodka, and the waiter had his bottle of Stomaklija, therefore after two drinks that we bought from him we started drinking together Stomaklija and vodka. (Although, advice is to start it after border.)

    Anyhow, in regard to the flight tickets in Croatia.
    I traveled from Zagreb to Split with the tilting train and paid one-way around 190kn. My boyfriend bought a plane ticket (two weeks in advance) for the same one-way root, and paid 220kn. The bus is around 180-200kn, one way also.
    For the lovely nature on the route I might chose the train once more, but tilting is terrible and there are no curtains (?!). So after that it will be only the plane to Split. (Yeah, and if we add 7 plus hours to Zagreb.)

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