The sins of EX-YU carriers and their managementsThe national carriers of Bosnia and Herzegovina, Croatia, Serbia, Slovenia and Montenegro will end 2010 with multi million Euro losses.
By the end of September Croatia Airlines has accumulated a loss of approximately 15 million Euros, an increase of 16.2% compared to the same period last year. “The aviation industry has just gone through one of the toughest periods in history and a further 3 years will be needed until the situation is stabilised”, a Croatia Airlines financial report for the Zagreb stock exchange states. The airline notes that the 2 day cabin crew strike and the Icelandic volcano ash cloud hit the airline’s finances even further. However, the Croatian national carrier did manage to decrease its expenditure by 6.2% this year.
Jat Airways recently reported that its financial result for 2010 will be “worse than expected”. The airline’s CEO said at a news conference in Bled, Slovenia that his optimistic plans for 2010 have been derailed by the failure to launch a base in Skopje, the delay in launching Sky Srpska in Banja Luka and the delayed technical overhaul of some of its aircraft. Furthermore, a series of managerial blunders have left the airline strapped for cash. However, the exact loss won’t be known until the 2010 financial report is published in January next year. Jat’s CEO, Srdjan Radovanović, became the airline’s number one man thanks to political ties (like most of his predecessors in the past few years) and has never worked in the field of aviation. Early in the year it was revealed that Jat’s head of finances, brought to the airline by Radovanović, has a high school diploma as his highest academic achievement.
Montenegro Airlines’ losses are also mounting. The airline owes “Airports of Montenegro”, the company that runs Podgorica and Tivat airports, 2.7 million Euros. The airline hasn’t paid its handling fees to the airports since August 31, 2009. The Montenegrin carrier is expected to end 2010 with a 5 million Euro loss, lower than most other EX-YU carriers. Montenegro Airlines’ CEO, Zoran Djurišić also has strong ties with the Government and has an ongoing corruption case against him, which involves the unlawful leasing of aircraft and the failed Master Airways project.
Increased passenger numbers have not financially materialised for B&H Airlines. The Bosnian carrier is projected to end the year with a loss of just over 6 million Euros. Additionally, the decision making process at the carrier has become extremely complicated as all decisions must be approved by Turkish Airlines in Istanbul. The airline still hasn’t named its new CEO, several months after Nudžeim Rečica (the former CEO) left the carrier. Rečica has been promoted by the Government from B&H CEO to the Ambassador of Bosnia and Herzegovina in Qatar.
Finally. Adria Airways’ losses have exceeded 13 million Euros in 2010. The Slovenian carrier received 2.5 million Euros from shareholders and partners last month in a move to aid the carrier.