Monday, February 8, 2010

Croatia Airlines in crisis mode

Not a good start to the year
Finishing 2009 with 15 million Euros in losses, Croatia Airlines is now facing one of the biggest crisis since its launch. The airline is cancelling the lease of one of its Airbus A320s, which will leave the fleet in April. Meanwhile, the recent news of route suspensions, in particular flights from London to Split and Dubrovnik, are also a result of the crisis measures put in place by the airline’s management. Croatia Airlines’ CEO, Ivan Mišetić, says that the carrier’s only cure is privatisation. Mišetić states that privatisation should be carried out before Croatia joins the European Union as to avoid numerous bureaucracy procedures. Mišetić blames the airline’s current situation on the decline in passenger numbers during 2009 and the rise in fuel costs.

Nevertheless, the airline will, as planned, receive 2 Bombardier Dash 8 Q400 aircraft this year and increase frequencies to Barcelona during the summer.

Another potential nightmare the national carrier of Croatia is facing is a strike by its workers which is set to ground the airline’s entire fleet. The Croatia Airlines union of cabin crew has voted for strike action which will commence at 6.00 on February 26. The cabin crew have received unconditional support from the pilot’s union which is set to announce that it too is going on strike in the following days. Syndicate representatives do not want to accept the January 1 decision of the Croatia Airlines Board. According to this decision, pay will be decreased by 10% or rather 30% per day. Compensation for meals and transportation will be cancelled, while both sick leave and vacation times will be shortened.


  1. Not good at all.

    What really will privatisation achieve? If the losses are directly related to the global financial crisis (of which airlines the world over collectively lost BILLIONS), then all they have to do is ride out the turbulent times until the recovery comes back, assuming they don't run out of cash in the meantime. Being a government-backed organisation, that isn't a problem.

    I was under the impression that OU was just not renewing the lease of the 320, as cancelling it would involve payouts etc. The two Qs will be a good addition to the fleet; a shame given the airline's poor financial statements that they couldn't pick up a few 'almost new' Qs off Frontier Airlines going cheap to give them the proper regional advantage they have worked hard to build.

    This is an airline which has gone through much in its short history, but it shouldn't be cutting off its nose to spite its face.

  2. Being a government backed entity is a HUGE problem, especially in a country as corrupt as Croatia.

    Politicians just can't keep their hands off of what they view as 'sexy' companies in their grasp (like airlines) and use them to appoint all manner of incompetent people to senior positions, almost always with disasterous results. Just look at Jat, amongst others.

  3. % anonymous

    100% fully agree with you !!
    JP is no difference


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