Saturday, July 6, 2013

Croatia Airlines to replace Airbus with Embraer

Croatia Airlines downsizing on fleet and selling Heathrow slots

Croatia Airlines is planning on purchasing Embraer aircraft to replace part of its costly Airbus fleet. In line with its restructuring program, the Croatian carrier anticipates the sale of three of its Airbus jets in the coming period. Originally, the airline intended to sell two of its Airbus aircraft and lease them back immediately, a common cost saving measure. However, the management is believed to have given up on the idea. The airline is now keen on purchasing Embraer jets from the Lufthansa owned Augsburg Airways, which is to cease operations on October 31. Croatia Airlines recently leased out one of its A320s to Tunisian based Syphax Airlines and began procedures on cancelling its order for four Airbus A319s.

Aviation analysts warn Croatia Airlines’ planned shift to Embraer will be extremely costly as the airline has never operated the type and would have three different aircraft types in its fleet - Airbus, Embraer and Bombardier. Apart from selling some of its Airbus jets, the Croatian carrier also plans to sell engines from its aircraft, as outlined in a recent restructuring program approved by the Croatian Competition Agency. Furthermore, it will sell land owned at Zagreb Airport and its shares in “Obzor putovanja”, “Amadeus” and “Pleso prevoz”.

As part of its restructuring program Croatia Airlines will also sell its lucrative slots at Heathrow Airport. Earlier this year the airline discontinued its Zagreb - Gatwick service but maintains flights to the airport from Split. It is estimated the Croatian carrier will earn 25 to 30 million pounds for its slots at Europe’s busiest airport. In February the airline reported its London route was struggling to make a profit, warning that flights to Heathrow would be under review for the 2014 summer season. Further slots are to be sold at several other European airports.

44 comments:

  1. Great! So Mother Lufthansa first of all bans OU from flying to London Heathrow, now it is going to sell them their second hand embraer aircraft!

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    1. True, but at the same time it bought BMI so that their daughter companies could increase their presence there. Really shocking and crazy what they are doing with Croatia Airlines.

      On a side note, maybe a fleet of Dash-8 and E-195s is the solution for Croatia Airlines? Have a 68 seat turboprop for shorter routes in the region and then have a 112 seat aircraft for longer routes.
      Another solution is for them to just concentrate on Embraer by creating a fleet mixed of E190s and E195s. After all, they should concentrate on fleet commonality.

      One thing is certain, it seems that the airline is heading towards total catastrophe.

      Delete
    2. Lufthansa is not owner of bmi any more. They sold bmi to British Airways.

      Story of Embraer is not new one. In March Croatia Airlines CEO Kučko first mentioned that idea, but on my question is it true, he said it will never happened. If that information is true, he lied.

      Selling slots in LHR is most stupid thing Croatia airlines can do!

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    3. I know they do not own BMI now but that was the whole reason for buying it. Best proof of this is in the number of frequency both Austrian and Swiss had before the acquisition and how many they had after. Naturally I am referring to London Heathrow flights.

      When did OU start their LHR flights?

      Delete
  2. What other routes could we see being suspended?

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    1. They think about Paris and Amsterdam.

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    2. Amsterdam?! Aren't their planes full on this route? I thought it was one that was performing rather well.

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    3. Kučko was chief of Amsterdam office. And AMS was only route that had decrease in number of freuequencies and passengers in Croatia Airlines network while he was head of office there. The only one!

      AMS was never good route. Without real reason. So who should be guilty for that?

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    4. So basically if KLM decides to launch Zagreb, Croatia Airlines is as good as dead on this market?

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  3. I just hope this effort won't be for nothing.

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  4. I have been a loyal customer of Croatia Airlines for 18 years. Their product has always been as equal to the likes of British Airways, Lufthansa, Austrian. But the company seems to be heading for failure. I certainly will no longer be booking with them after this year! I can see massive strikes next spring and bankruptcy! It is such a shame!

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  5. OT:

    Adira Airways to NIS this winter. Soon more information!

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    Replies
    1. You mean Adria? Flights to Ljubljana?

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  6. Welcome to the European Union!

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  7. So basically they are moving away from Airbus closer to Embraer. In other words they are turning more and more into a classical feeder airline.
    With such small aircraft they won't be able to run charter flights any more. But who cares about that when they will fly to Zurich, Vienna, Munich, Frankfurt, Brussels.. who needs more, right? ;)
    Wonderful, just wonderful.

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  8. So basically Jat and Serbia are getting 10 A319 and additional Dash-8 aircraft while we are getting a few Embraer jets in place of our Airbus fleet.
    How could we end up to this when our market is much bigger than the one in Serbia?! It just goes to prove how stupid we can be and how we don't know how to make the best of what we have.

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    Replies
    1. Well, to my mind, the Croatian market is "not bigger then Serbian one".

      Yes, there are may tourists flying to Dubrovnik, Split, Zadar, Rijeka and Pula but the most routes are CHARTER.

      Considering all-year-routes, Serbia has the biggest market in the region due to the huge diaspora and some 5.000.000 people in the catchment area of the airport.


      The most routes from Dalmatia are operated as charter and Croatia Airlines is to expensive to be used as an airlines for the west european tourist offices which use low cost companies to get tourists to Croatia.

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    2. Not true:
      1. Croatia has more passengers in winter than Serbia

      2. Croatian airports have much more routes during winter than Serbia (regular domestic routes during winter are from ZAG, ZAD, PUY, DBV, SPU, and international routes during winter are from ZAG, ZAD, DBV, SPU).

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    3. Do you have any numbers to prove this, last anonymous.

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    4. October-April

      BEG 1.576.987
      Croatia (all airports) 1.823.357

      Winter lines from BEG 56 routes by 19 airlines
      Winter lines from Croatia 58 routes by 21 airlines

      Delete
  9. Mind Augsburg is not owned by LH ! They are just a Team LH airline, just like Contactair was.

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    1. True, but all fleet of Embraers that Augsburg was flying on is owned by Lufthansa and just leased to Augsburg.

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    2. ..and again almost correct. One of the E190 is not leased from LH

      Delete
  10. Everything that we hear from OU recently goes from bad to worse. Main problem here is that their market share is dwindling. Who is to blame, government policies, bad management who knows but it's definitely not a sign of good things to come especially now that Croatia is in the EU.

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    Replies
    1. You should blame Belgrade for it...

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    2. lol true, it certainly seemed to be a pattern with Croats. Let's hope they start blaming Brussels for their current and future misfortune.

      Delete
  11. I have said this before but I will say it again. Cooperation with Lufthansa should only continue if it proves to be profitable for OU.

    OU along with every other government owned / operated company in Croatia should have been sold years ago for obvious reasons!

    The airline clearly is not set up to serve the market it is in. This full service carrier model it uses needs to be changed yesterday!

    An all A319 / Q400 fleet is perfect for OU. Any move away from this will be a disaster!

    If OU wants to continue as a Star feeder than London Heathrow if it is not profitable should be abandoned but don't sell the slots!!! Lease them out and launch at least a 5 weekly London service to one of the other London airports.

    Also, OU is becoming too expensive!

    ReplyDelete
    Replies
    1. Once Etihad has sorted out JAT, seems to me that it will be the strongest carrier in the region and given how LH has fucked OU, cooperating with the new "JAT" may well be its best bet for survival....

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    2. Yes but can they actually get the courage to say no to the Germans in order to go work with the Serbs?

      As a Serb I highly doubt that could ever happen.

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    3. Plus, why would the new Jat want to work with Croatia Airlines?
      If they want to attract passengers from Croatia they can just launch their own flights.

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    4. Jat carriers about half the amount of passengers compared to OU so it will be a while for Jat to take over OU as the strongest carrier from the former Yugo unless OU ceases to operate.

      No offence but why would OU want to start to cooperate with Jat and Belgrade where all they will do is offer a much inferior product compared to what they offer now as a star hub feeder. Even though the current situation does not seem to work for OU it will be a lot worse if they did what you suggested.

      OU needs to expand away for being a Star feeder and charter carrier only and work on what Croatia needs for air travel.

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    5. Well, Jat will be taken over by Etihad and it will expand its fleet and network while the exact opposite will happen with Croatia Airlines. Let's not forget that by removing some of their Airbuses they will, at the same time, reduce their presence on the coast. In other words the future of Croatia Airlines' business will be Zagreb-centric. With it their numbers will be considerably reduced.

      We will see what will be the outcome of both restructuring plans by next summer. One thing is for sure, Jat will be around while unfortunately I think we can't say the same for Croatia Airlines.

      Delete
  12. With Croatia Airlines' future uncertain now more than ever, is it wise to build such a large terminal in Zagreb?
    Maybe some sort of extension of the current one with an upgrade for jet bridges.

    I just doubt it is a wise thing to build a new terminal when you might lose your biggest customer.

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    Replies
    1. Then other airlines will simply increase current ops or open new routes. Passengers will still be there and Croatia could ultimately lose national carrier which will be replaced by other airlines.

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    2. Maybe even Wizz Air will open a base there.

      Delete
  13. Crash landing of an Asiana Airlines 777-200
    in San Francisco/USA...
    My condolences.

    ReplyDelete
    Replies
    1. No need for condolences as there are no fatalities.

      CNN is hilarious to watch. <3

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    2. Two reported dead just now :(

      Delete
  14. Croatia Airlines becomes Air Dalmati

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  15. Funny thing is to see all these comments on JAT-Etihad deal as granted success! It feals like timewarp, that we are in 2016., that JAT is flying with Airbuses and Q400, etc, etc...

    It's long, long road to that point, with so many known and unknown problems...

    Regarding Croatia airlines, current fleet is perfect for them, any reduction to smaller airplanes would be disaster...

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  16. OU must realise smaller planes aren't necessarily more profitable for them. They need a fleet of 6 319s and 8 Q400s to serve today's needs (current level of seats, different distribution of aircraft), and likely another two of each aircraft in 5 years' time if they want to still hold the lion's share of seats in/out of the country. By then the CS300 will have been flying, and if proven, would be an ideal 319 replacement if larger planes are not needed.

    What WOULD be profitable for them would be to get away from LH and the notion that *A looks after them - if one of the other big groups (IAG or AF/KLM) made a takeover offer and changed the 'feeding LH hubs' mentality the airline would have a good chance of survival - and profitability.

    It's a great airline which has been ruined by corruption and incompetence in recent years... Only one CEO (Simunovic) demonstrated any logical vision for the airline, and he was removed for doing his job properly. A shame.

    ReplyDelete

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