Wednesday, November 11, 2009

Winners and losers

Can Adria stage an end of year comeback?
It has been a difficult year for the aviation industry which has been hit by the global financial crisis. The crisis came before the airline industry could recover from the fuel price hike and experts predict the industry won’t see any signs of recovery in 2010. An added deterrent for passengers in Europe is the recent wide scale outbreak of the H1N1 virus.

This year Croatia Airlines is once again set to secure its position as a regional leader, when it comes to passenger numbers. The airline, despite previous predictions, did not suffer greatly from the crisis even though the country’s tourist industry did. Over the previous 10 months, on average, Croatia Airlines has seen a 4% passenger decrease on a monthly basis. However, as the New Year approaches the airline is reporting greater passenger losses when compared to last year.

Despite a change in management and a 5 day strike which paralysed the airline, Jat Airways is still ahead of its Slovenian counterpart Adria and is set to finish the year in second place, passenger wise. The decline in passengers has not only been caused by the financial crisis but also because of the excessive loss of passengers travelling between Serbia and Montenegro, which, under an agreement made by Jat’s previous management, have been handed over to rival Montenegro Airlines. The airline is expected to have just over 1 million passengers by the end of the year.

Adria Airways is perhaps the biggest looser because without any major internal crisis it has seen an average 15% passenger decline each month. During the first 6 months of last year the airline enjoyed the benefits of being the flag carrier of a country residing over the presidency of the European Union. A year later, the airline no longer has so many business passengers to count on and combined with a recession has seen a passenger decline, although a late comeback is still possible. The airline’s passenger decline rates have been decreasing steadily as the New Year approaches.

It should be noted that all 3 airlines will end the year with big financial losses.

Out of the smaller EX-YU carriers, Montenegro Airlines has pulled off a good year, reporting an increase in passenger numbers (in part due to its new found glory on services to Belgrade) and will financially end the year break even. B&H Airlines has also had a good year passenger wise but is set to post a financial loss.

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