Sunday, May 19, 2013

Possible successor to Croatia Airlines

Difficult times for Croatia Airlines

The Croatian government has begun planning for the possibility of its national carrier declaring bankruptcy as the airline’s pilots and cabin crew enter a sixth consecutive day of industrial action. The airline is bleeding money at an alarming rate as it has been forced to lease foreign aircraft and crew to partially maintain its operations. In addition, a lot of passengers have requested compensation for their cancelled flights and many are now apprehensive of booking tickets with the Croatian carrier.

The Ministry for Sea, Transport and Infrastructure believes bankruptcy is imminent if the strike stretches through next week. It has devised a plan for such a scenario. In case Croatia Airlines does declare bankruptcy the government would create a successor national carrier which would take over Croatia Airlines’ fleet, slots and half of its employees. The government would immediately begin the search for a strategic partner and would maintain a 49% stake in the airline. Dan Simović, from the Ministry, says the government would prefer for the majority partner to be outside of Europe. He believes the entire process of setting up a new airline would last four months. However, he warns that such a scenario could impact on tourism and other businesses which rely on Croatia Airlines.

For today, the Croatian national carrier has cancelled its flights from Zagreb to Skopje, Sarajevo, Zadar, Dubrovnik, Split, Copenhagen, Pula, Frankfurt and Munich. Furthermore, the airline has cancelled its services from Dubrovnik to Athens, Berlin, Venice, Zurich and Dusseldorf, while flights between Pula and Zadar have also been cancelled. Adria Airways, Trade Air, Cello Aviation, SkyWork Airlines, Bingo Airways, Enter Air and WDL Aviation will be operating some of the national carrier’s flights. Yesterday, Lufthansa and Brussels Airlines temporarily suspended all of their codeshare agreements with Croatia Airlines. Currently, there is no end in sight to the ongoing industrial dispute which began on Tuesday.

34 comments:

  1. Its unfortunate the government dont realise that as a soon to be EU member a partner outside Europe cant own 51%

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  2. This is indeed very dramatic, but on the other hand also very brave of the government. If we look to west, south or east of Croatia all neighboring airlines do not deserve to be alive in todays condition!

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    1. Croatia heroes!
      Facing troubles no corruption Slovenia style.

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  3. It would be a quick way to get rid of the excess bloated workforce. But you could guarantee the management would be typically corrupt Balkan people.

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  4. What happened to the stories we all listened here how good and mighty OU is, comparing to the rest of the region's junk airlines (which they all are). Only six days of strike was enough for Government to declare that such a good airline is on the verge of bankruptcy and they consider creating a successor for OU. The point is, things are not always what they look like, judging by package and some loud local patriotism...good luck to OU and the rest of ex-yu airlines!

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  5. This comment has been removed by the author.

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  6. 500 people at say an average salary of 700 Euro's is around 4 million Euro's per year. Is this enough to save OU? With an estimated debt of 150 million Euros, probably not. The longer this goes on and the more news and information that is coming out, the more it looks like this might be the last summer for Croatia Airlines.

    So what of the new airline as mentioned in the article. If it just takes over the current airlines leases / slots but has a work for of just 500, how will be new airline be any different?

    There was a story a few years back about the Q400s in OUs fleet and how the airline pay a lot more for the lease compared to other airlines. This had something to do with the aircraft being 'double leased'. It was set up like this so that persons (probably OU management and friends) would get a cut from the lease. I'm assuming the Airbus aircraft are also overpaid for.
    It is very worrying that they can consider another airline be set up where it is just burdened with the same high costs from the start. We think that these people must be stupid but really it is just another way for them to secure this corrupt income stream. So they are not stupid but sadly just crooks and I can't wait until the law (if it ever does) catches up with them.

    I hope I'm not being too premature in saying this but it will be sad to see OU go. It was one of the first real international symbols of Croatia and I can still remember my first flight. 737-200 ADV Frankfurt to Zagreb in 1994. I even have a video of the landing on VHS somewhere.

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    1. If you fly with jat, you can still experience what it's like to fly on a 737-200.ADV thanks to their wet lease of Aviogenex aircraft! Yes it will be sad to see OU collapse! I remember my first flight back in 1995!

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  7. ADR, here might be your chance. 1st of July is only 6 weeks away ...

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    1. ADR? Adria?

      Are you on coca (ah yes it's bringing money to Slovenia mafia politicians and so called bussinesman).

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  8. New name should be Croatia Airways.Standard for balkan mafia :))

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  9. I honestly hope the government and management will be able to at least conclude this summer season before announcing bankruptcy. It would be a major loss to see OU go, especially now at the very beginning of the summer season. Croatia as a country would lose out enormously if all those expensive tickets and tour packages were suddenly rendered invalid by OU going under.

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    1. Get rid off this management as soon as possible!!! They are the maffia in Croatia Airlines. Especially Kresimir Kucko and his so called political friends. They ruined the Airlines
      with their greed and hunger for power!!!

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    2. Kresimir Kucko has destroyed the company in a matter of months!

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    3. Kresimir Kucko has to go NOW!!!

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  10. If Kucko destroyed Croatia Airlines where is all the money? Probably in his own pocket and the political gangsters! They should be arrested!!

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  11. KUCKO IS A CRIMINAL!!!!!

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  12. YEAHHHHH!!!! He is a criminal and also protected by the Government!!!

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    1. Same as here in Slovenia.
      Adria dicit.
      With the differenxce that in Slovenia big criminals are never labelled as criminals.

      Tosić cocain mafia and so called business mafia turned politicians with cocain and related income.
      Made in Slovenia.

      They are all Free
      cocain pays forever only in SLovenia.

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  13. Protected by the voters who have been electing such governments in the last 20 years.

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  14. They are criminals too. Total corruption!!

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    1. Total corruption is only in Slovenia.
      Learning from brothers?
      YOu can be max 20. 23. Croatia.
      We are the 2. in the world after Nigeria (official int. studies 2013 search on web).


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  15. Before we start throwing around empty accusations about the management, I think it would be right to say that before entering the EU, OU was in good financial standings due to the subsidies it was receiving from the Croatian government, however after Croatia's accession to the EU it will not be able to continue providing such support.

    Because of this OU is planning on restructuring its fleet, as well as finding new strategic partners to compensate. Further more, the management did not foresee a strike taking place. Only if this strike takes place will OU go bankrupt, which will not benefit the management whatsoever because Croatia would be in the EU at the time, making it extremely hard for any sort of individual gain.

    I believe that this strike is only hindering Croatia Airlines chances for a continued existence, and by making unreasonable demands such as asking the whole management to resign, the employees will only hurt the company. Instead of loosing 200 jobs, a little more that 1000 people will be looking for new work.

    I seriously hope this doesn't happen because I like OU and have very fond memories of it!!!

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    1. 'OU was in good financial standings due to the subsidies it was receiving from the Croatian government'

      This is where I can not agree with you. If any company needed this much government support than I don't know how you can say it was in good financial standing. Long gone are the communist days where government borrowed heavy and paid back only the interest just to keep people employed. It is a real shame that the region and this is probably an Eastern Europe problem not just Balkan, have not moved fully into a market economy.

      Just imaging if from 10 or 15 years back, OU was run with the aim of turning a profit every year. And as a result people who's job it was to met this target was in place to run the airline and if this target was not achieved than they would be at risk of loosing there jobs. Maybe today OU would have been able to grow naturally to a company which could support 1000 plus workforce. But this is not the case.
      The airline producing a loss almost every year has caused the company to have little chance of expanding successfully and when ever it has tried to do so, the added financial burden has been too much for it to handle.



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    2. 'OU was in good financial standings due to the subsidies it was receiving from the Croatian government'

      Pay Slovenia-Adria for advice how to mix the papers, hide what you want to hide and show what you want to show.

      Croatian Airlines stil can play Slovenian style ... for new subsidies.

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  16. Cant wait for it :D

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  17. well unfortunately, q400 has it right on the spot. it seems this is just a plan to let go the only people working in this company and establish a new airline led by the same corrupt people that aren't mentioned in the newspaper, but believe me there's a lot of them... the whole of the management (i mean even middle management, team leaders etc...) is just a bunch of incompetent and corrupt people.
    Not everyone is like that, there are some decent and knowing people, but most of them are just people who should never be employed in such a competitive and complex sector like aviation business is. they are simply not up to it, and besides that they are propably too busy filling their pockets with taxpayers money.
    most people working in administration are in no way better then their management all gettin their jobs through nepotism and corruption and stealing where ever they can.
    the only people doing their job as it is supposed to be done are their cabin crew and pilots, the only valuable asset of this corrupt bunch. anyone who's flown OU knows what i'm talking about.
    and...kucko....he's just a puppet, no one important. as i said the same people are leading the game in the last 20 years and their names are not published in the newspaper. nor will propably ever be.
    ah...one info for the author..Mr. Simonic is an "insider", he was in the management of OU (it director), he's not so incompetent person comparing to other in that company, before going to ministry of transport so he propably knows "the plan" and the workers union is just helping them to achieve that. knowingly or not? who knows...i guess union leaders will be working in this new company also.

    i hope the "foreign investor" wont be from Cayman Islands or something like that. :-)

    stay cool, nice blog and off with the nationalistic crap, we're all in the same shit led by same type of corrupt and incompetent "people". i guess some have hard time comprehending that.

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  18. Move anywhere, corruption everywhere!, in the bloody Balkans; what a shame! What a bloody disgrace!
    Fuckin' idiots called voters are not able to differentiate between honest people and criminals. Such voters are not brain washed; they've never had anything in their heads except emptiness.

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  19. I think the business model of Croatia Airlines isn't making profits possible. Instead of flying as many as possible longer routes with O/D pax to major cities from ZAG and the coast it ended up as Star Alliance feeder into FRA/MUC/ZRH and VIE. No wonder, based on 4 segment-prorate tickets LH and their daughters collect the bunch of money while OU keeps very little for the short segment. This was already mentioned and criticized by the pilots. Furthermore OU has far too many town offices and employs too many own airport people abroad (4 in FRA alone) instead hiring a supervision agency and just keeping one own manager at most important airports....and so on and so on.....

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