Monday, January 6, 2014

Adria to become hybrid low cost airline

Big plans for Adria until 2020

Adria Airways has planned out the next six years of its development which will include increasing passenger numbers and a complete renewal of its fleet. The CEO of Slovenia’s national carrier, Mark Anžur, says, “As part of the Adria Airways Business Strategy until 2020, which we have already prepared and which we intend to implement over the next six years, we plan to, above all, grow and expand”. He adds, “We aim to increase passenger numbers to two million per year, purchase new aircraft and, in this way, continue with the optimisation of our fleet. We will also introduce new routes, increase cost effectiveness and adapt to the needs of the market in terms of pricing”. The airline will downsize on the number of its Bombardier CRJ200 aircraft and replace them with the larger CRJ900 version in the coming years. Adria currently has eleven aircraft in its fleet – four CRJ200s, four CRJ900s, two A319s and a single A320. The six year development plan also outlines that Adria will become a hybrid full fare - low cost airline, similar to Flybe, Vueling Airlines and, increasingly, easyJet where passengers can choose basic low fares but can then add a range of other services with extra charges.

The year ahead is shaping up to be a decisive one for Adria. The government plans to sell a majority stake in the carrier this year but is holding off the process until the European Commission rules whether state aid given to the company was in line with European Union competition laws. If the Commission orders Adria to pay back the government 85 million euros, it will have to find a partner immediately otherwise it faces the fate of Malév Hungarian Airlines or Spanair. A ruling is expected soon. The airline’s last privatisation process, in 2012, failed. Despite the ongoing court case, Adria is planning to expand its business in 2014. “Preparations are underway for the introduction of new routes next summer season. At the moment I can confirm future services between Ljubljana, Warsaw and Prague, as well as between Tirana and Frankfurt. We are also planning to resume flights to London”, Mr Anžur said.

Last year proved to be relatively successful for the Slovenian carrier. It managed to see its passenger numbers grow for the first time in years. In the first three quarters of 2013, the airline handled 808.370 passengers with its average cabin load factor at 73.5%. However, it is believed Adria has just missed its financial target of breaking even, although this is yet to be verified. Latest data shows the airline turned a profit of 700.000 euros in the first nine months of 2013 compared to the 6.8 million euro loss on the year before. During last year, Adria sold a large amount of its assets, mostly to Ljubljana Airport.

109 comments:

  1. It seems that they are getting their act together and their business plan looks promising. I am sure the European Commission will take this into account when making its final decision on Adria.
    Somehow I believe that Adria will make it and if they manage to implement these structural changes then they will attract quite a few passengers from the region. It seems that the CRJ-900 is a good fit for them, I just do not understand why they are waiting for so long to get rid of the CRJ-200s. It's not like the 900 is hard to find on the market.

    Shame that there is no mention of their future network. Would be nice to know where they intend on expanding and if they gave up on their Balkan expansion which was planned just before the crisis.

    ReplyDelete
    Replies
    1. Why should European Commission take into account the way how they transorfm before making the final decision?
      If I use money that does not belog to me, police catch me I think that judgment will not be made according to the purpose I wanted to use that money.
      I dont say that Adria should be punished, I really dont know the matter. Just logic...

      Delete
    2. Because in the European Union things work differently. If the technocrats there see that the airline is working fine they will not punish them. They will only do so if the company is hopeless, as was the case with Spanair or if there is political motivation as was the case with Malév. I think both airBaltic and Adria are safe.

      Cyprus Airways is another airline currently under investigation and just recently Brussels told them that they are losing patience with them and that they better find a solution that works or they will have to shut them down.

      It's not really in Brussels' interest to shut airlines down.

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    3. Adria Airways is not hopeless?
      What are you smoking?
      I want the same.

      Delete
    4. It's not hopeless on paper, that's all Brussels technocrats care for. None of them know anything about aviation and all they will see is reduced losses, increased passenger numbers and a business plan for the future. It's not like they will call for experts to heck all this.

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  2. Business Strategy until 2020!

    Come on you even don't know if you survive the 2014.

    European Commission do your job consistently
    if you care about your reputation and trust for the missions assigned to you by law.
    European Comission don't be fooled again
    because you are creating a PRECEDENT.

    Flying competitively it's not like selling coca in Eu.
    It's harder.

    ReplyDelete
    Replies
    1. LOL! Calm down. Looks like you took too much coca yourself :)

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    2. At least they have SOME strategy.
      What strategy did Jat have?

      If there wasn't the elections in 2012. we would not have a flag carrier. Making plans for 2020. is at least better than "let's just think about how to survive this year" .

      Hybrid tactics is quite a good move for market of 2-2.5 mil people with so many good airports around it.

      Delete
  3. uf dobro je. mislio sam da sve menadzerskih budala ima samo kod nas Srba. ima ih i u Sloveniji. biznis plan do 2020,naravno nedostupan, i kombinacija lcc i legacy-ja kao easyjet npr. majko mila!

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  4. Adria's strategy is nothing but hot air - wow, an airline saying it wants to increase passenger numbers, routes and fleet modernisation - ground breaking stuff. this is nothing more than stalling for time - there's nothing in that strategy that gives any indication of a real blueprint on how to get out of the mess they're currently in - it's all rhetoric at this stage!

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    Replies
    1. As far as I learned at marketing lessons at university, there are 3 types of strategies: corporative ones, competitive ones and functional ones. The one presented is corporative one, and it consists mainly from numbers and sam general predictions and goals. So what's the problem? We are going to see about how they are going to make it, for now we now it's gonna be a hybrid, which is not a bad idea...

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  5. Aleksandar KuzmanovićJanuary 6, 2014 at 12:45 PM
    &
    Peter from SydneyJanuary 6, 2014 at 1:34 PM

    It looks like that you are both experts ... so what is wrong with a stategy? As far as i know strateg has never been the same as business plan. No warrior would reveal the strategy how to win.

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    Replies
    1. pogresno je: ne mozes uspesno mesati babe i zabe. Nije niko uspeo pa nece ni adria. Zato sto su u pitanju dva bitno suprotna sistema rada i upravljanja. Svi bi hteli rezultate easija ili ryanair-a ali kad im se predoce preduslovi,"eee pa ne moze to"....

      I jedno pitanje opsteg karaktera : Za koji moj vi pisete ovde na engleskom? jel hocete da pokazete da ste fluent ili nesto trece?

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    2. And what is Germanwings, FlyBe, KLM Cityhooper...? It is not new... hybrid low cost airline exists in Europe for years now.

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    3. pa upravo ti o tome i pricam, ko je od njih uspesan da može da se poredi sa ryanair-om, easiejm ,southwestom. pa niko. u tome i jeste kvaka. ne može samo copy/paste mora ceo sistem da se menja. a niko od legacy-ja nije spreman na tako nešto. ako ni zbog čega drugog, ono zbog gubitka priveligija velikom broju menadžear rodbinskog i /ili partijskog porekla,npr.

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    4. Uspjesnost je realtivan pojam. FlyBe je izuzetno uspjesna firma, tu spora nema, no model sigurno nece moci nadmasiti easyJet ili Ryan. Ali jel to i cilj? Naravno da nije. Pronasli su svoju neichu i guraju je. Cityhooper i Germanwings imaju svrhu raditi za svoje mamice i samim time su više nego uspješni. Da je Cityhooper ostao ono što je bio i da nije krenuo u hibridnost danas ga ne bi bilo. Da je Lufthansa nastavila sa svojim modelom iz drugih zračnih luka koje nisu MUC i FRA kompanija bi vec danas bila na bubnju.

      Adrija ne radi hibridnost zato da bi potukla esayJet ili Ryanair, nego da pronađe uspješan model i preživi. Očito je da će kopirati Lufthansin model Germanwingsa. Ako im to omoguči preživljavanje i bar neku profitabilnost što više treba tražiti. A ako vi mislite da je jedini uspješan model onaj koji bi postao broj 1 i napakostio easyJetu ili Ryanu onda nešto ne valja u vašem poimanju svijeta.

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    5. "Nije niko uspeo pa nece ni adria."

      Covek je lepo kazao da ima tko je uspeo sa tim hibridnim modelom. Flybe, Germanwings, KLM Citihooper. I možeš sad da se izmotavaš Aleksandar, ali pišeš o onom što ne razumeš.

      Delete
    6. There is also airBaltic which, after restructuring itself, managed to record a profit during the summer months. I think there is also a possibility for them to finish their financial year in black.

      Delete
    7. Bili praznici pa nisam stigao,
      GWI LCC? I na tarabi piše pa vas nisam video da skačete na istu.
      Merljivost uspeha? u savremenom leberalnom kapitalističkom svetu bez problema: -Cena akcija (rast istih-odslikava u velikoj meri i organski rast firme ) -dividenda -i safety ,broj udesa na broj operacija /sat naleta (mada postoji direktna proporcija izmedju prva dva navedena i safety-ja )
      Tu vam i leži objašnjenje u kartkim crtama zašto ne može kombinacija poslovnih startegija. Može ali nije uspešna kao opredeljenost ka jednoj od opcija. A pogotovo to neće uspeti menadžemnt Adriej jer samom svojom izjavom, rečeničnim konstrukcijama i nesuvislim objašnjenjima i neprimerenim poredjenjima diskvalifikuju sebe kao nekog ko je sposoban da nešto promeni i uradi.

      Delete
  6. Victoria started sharing her secret with all those passing through Belgrade airport. I must say the picture looks quite nice.

    https://fbcdn-sphotos-g-a.akamaihd.net/hphotos-ak-ash3/q71/s720x720/1491585_10152101523056539_429942192_n.jpg

    ReplyDelete
  7. sorry for OT but this is sad
    Todays both outbound and inbound B&H flight to and from Belgrade had ONLY 1 passenger!!!!!! WTF
    Why didnt they transfer the pax to Air Serbia lol
    Source: Aerodrom Beograd facebook page

    ReplyDelete
  8. Also Air Serbia had only 13 passengers inbound to BEG, which is also pretty depressing.
    btw I am Serbian so dont say I am hating or anything
    I want the best for all ex yu airlines

    ReplyDelete
    Replies
    1. Well, 55% LF... and every day delay... of course flights are empty.

      Delete
    2. How stragne that Air Serbia did not publish their LF details.

      It should be less than 55% LF like in November.

      Delete
    3. Yeah, I guess the 19% passenger growth at Belgrade was all thanks to Wizz Air and Montenegro Airlines while JU's numbers are rapidly falling. You guys are totally right.

      Delete
    4. I heard that yesterday's flight from Larnaca was completely full with only 5 passengers getting-out in BEG.

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    5. Late December when my friend travelled VIE flight to BEG had almost like 33% of Greeks only. They were joking the crew should start selling greek newspapers in the plane. Your info is even better.

      @AnonymousJanuary 6, 2014 at 9:54 PM

      let's just agree easyJet contributed the most LOL :D

      Delete
    6. Yes, that is correct and there was a large group of German passengers on board.

      Delete
    7. I don't understand why so many individuals on this blog think that Air Serbia must have a 90% load factor on all new routes. It takes some time for routes to become popular. We are seeing some good results, BEG increased passenger numbers by 19%.

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    8. First 7 days of January : Air Serbia recorded +70% growth in the number of passengers yoy. Belgrade airport will handle surely +35% more passengers compared to January 2013.

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    9. Gordana where did you get that info? Can you give us info about specific routes

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    10. If those numbers are true, then Air Serbia is an explosive success.

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    11. 19% more passenger and 40% more flights = very low LF.

      It is not that hard to open new routes. To make them with good LF and profitable is the trick. If not JU will bankrupt. That easy!

      How many new rotes were open in short time by Kingfisher? We were so impressed. And what happened with company?

      AGAIN, WHY AIR SERBIA DOES NOT PUBLISH LF FOR DECEMBER?

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    12. The increase in flights at BEG for December is 23%, not 40%. 19% more passengers and 23% more flights is not that bad. Your wrong numbers only discredit you.

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    13. Air Serbia in december had around 110.000 passengers (+27%), while executing 42% more flights. Load factor was 55%. Regarding load factor, the most successful routes were Vienna, London, Paris, Stuttgart, Prague and Tivat (around 70%), while the worst were Banja Luka and Tel Aviv (32%) and Skopje, Istanbul and Abu Dhabi (40%).

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    14. How load factor is counting if you cancel flights due fog? Is maybe that reason why LF for Skopje is too low? Skopje was one of the best last month.

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    15. You are not right. Performance for Skopje route is even worse in January, load factor is slightly higher than 35% till now.

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    16. I thought on November . "In addition, the airline recorded its highest average
      load factor on flights to and from Vienna, Tivat, Sarajevo, Skopje and Dusseldorf. " http://exyuaviation.blogspot.com/2013/12/exclusive-air-serbia-sees-double-digit.html

      I just asking how load factor is counting if you cancel flight...

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    17. There is no point to reason with people who are determined to trash the airline.
      However, what really surprises me is that Vienna is still operated as a double daily Atr flight. I hope we might see more frequencies during the summer season.

      Actually, 32% loadfactor to Tel Aviv is a major success especially if you know that back in the day, Jat Airways carried on average 20 passengers... 30 on a good day.

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    18. I think that one of problem AS has is big gap between ATR72 and Airbus 319 (Boing 737-300). If they were having some jets like E175/190 they can easily add or remove capacity.

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    19. Although I agree with you I think this gap will be overcome by network expansion and growing transit passengers.
      I just wonder if Prague will also be operated with the A319 like Bucharest. Prague has so much more O&D potential that it is only logical to upgauge it.

      It is interesting that there are a lot of airlines around which are not that happy with the E190.

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    20. Maybe ,let say two A318. I know that it is not so popular,and it is much heavy then E190 but then
      they can combinated with A318/319/320,same pilots same maintenance and it could be very good starter.

      Delete
    21. Hmm the A318 was a total failure of an aircraft. The A319 is not much bigger and its performance is, overall, much better.
      Yes, Air Serbia has a few routes which are currently under-performing but it's normal. Every route needs some time to mature. Eventually they will fill those seats.

      Delete
    22. Yeah, but it would be useful if they more types of airplanes than just rather ATR 72 and A319. They need ATR 42 for the balkan routes such as Sarajevo and Banja Luka that can't fill an entire ATR 72, and it would be nice to have a plane such as the E-175 for longer routes that can't fill an entire A319, such as perhaps Barcelona or Madrid. Tarom has the ATR 42 and A318s that seat around 100. All the high capacity routes are already taken by the big carriers, the only routes that are left for transit passengers are smaller destinations.

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    23. Actually, having several types of aircraft in the fleet is not useful at all. Fleet commonality is something all airlines strive to achieve so as to reduce costs.
      Tarom purchased the A318 due to political pressure from the European powers. They have been trying to get rid of it for ages now. Several managements have said that the plane is a waste and that it's not making any money. Even Air France has expressed their dissatisfaction with the aircraft.
      E-175 will not work well on longer routes as it increases CASM. Also, I flew on Lot's E175 from Warsaw to Larnaca, so a flight of three hours and forty minutes, and I can tell you that it was one of the worst flights in my life. Embraers are not that great on longer flights.

      As for the Atr-42, I still believe that the -72 series is better due to reduced costs. Let's not forget that JU mostly uses their Atrs on shorter regional routes so the cost of operating them is not that great. I am sure they can fill an Atr-72 to Sarajevo without a problem. I just don't see EY going for the 42 version.

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    24. I don't think the CASM of the E-175 is comparable to the A319. The other beneficial thing about the E-175 is that it costs much less to buy than a A319, and it can be delivered much quicker because the backlog is not that large.
      From what I understand, the ATR 42 and 72 have a lot in common, and it is kind of like operating two versions of the same aircraft. The ATR 42 also costs around 5mil less, and is faster and has a slightly smaller CASM. It would be useful for daily flights to "seasonal airports" that don't see many flights during the winter.

      Delete
    25. All this depending on purpose of putting particular jet on route. Maybe you will not earn some money with A318 but you will lose less money .
      If you are having some day less passangers , you can send A318. That is better than if you send A319 which will be half full.
      If you put A318 on some route which you starting to build,you will lose less money.

      And probably if your route is small one,if you send E175/E195 you will probably earn money. But if you had only one or two such plane ,then your fixed cost are much higher(new pilots and etc) . This is reason why small companies are not profitable. You can't optimize route with small fleet.

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    26. Aleksandar,

      First of all, we do not know what kind of prices JU got for their A319s. Let's not forget that the negotiations were made on behalf of Etihad. I am sure they got a very, very good deal for them. After all, leasing companies know that Etihad will be looking for more aircraft in the future so they know they are a customer worth keeping happy.
      Regarding Atr 72 vs 42, the things are not that simple. Costs are not that different yet the number of seats is. In other words, you have far more potential to make money with the 72 than with the 42. The only way 42 makes sense is if you are flying to markets you know can not sustain a larger aircraft. For the time being JU does not have such a destination in its network. Some might argue that Banja Luka would be a prime candidate but the sheer distance of the flight makes this difference negligible. CASM on this route would be so low that it would not make much difference if you were flying the 42 or the 72. Let's take Prague as an example. Let's say JU has on average 60 passengers per flight. Though the Atr is, in theory, more economical, the airline might be making more money by flying those 60 on the A319 rather than on the Atr. That's because the Atr loses on its efficiency as we approach the 500 nm mark. However, the CASM discussion is a complicated one and this blog is not really convenient to discuss it.

      Last anonymous,

      Actually, I would like to remind you that an E-195 can take around 120 passengers which means that its capacity is not much smaller than that of an A319. However, the A319 has larger cargo holds while the Embraer has been known to cause problems with the small luggage holds, especially those towards the tail. Also, many airlines were unhappy with the E-190, its nickname is 'the hangar queen.' What I am saying is that a route is not 'small' if you can send your E-195 there hence why I don't really get your argument there.

      The point I am trying to make is that there is a reason why both the A318 and the Atr-42 did not sell well. If these two did not suit so many airlines in the world, I do not see why Air Serbia would be an exception.

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    27. Nemjee, I get what you are saying, but I think the ATR 42 would suit JU very well. The A318 would be terrible, but maybe the E-175 would be okay.

      The ATR and E-175 would allow JU to add under-served routes to it's network. Do you think Belgrade-Chisinau could fill a daily ATR 72? Probably not, but that route could probably fill a daily ATR 42, and most of the passengers would connect to JU network. The ATR 42 is faster than the 72, and it weighs less, so airport fees are less. The ATR-42 did not sell well because most major airlines can fill a 72, but JU can't unfortunately, there are just too many big airlines in Europe. The only hope for JU is to capitalize on all the low traffic routes, and serve the undeserved airports such as the coastal airports. Graz, Corfu, and Bratislava could all not fill a 72. Operating a 42 would bring enough savings to make up for the fact that the fleet has another variant of aircraft.

      Even Lufthansa Regional has the E-jet. There are just some routes that can't handle a full A319. The E-jet will be more economical at every distance, and it costs half of a A319. These aircraft would allow JU to significantly increase it's network. A large network is necessary for getting transit passengers.

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    28. Aleksandar, thank you for reminding me of that. I actually think that Air Serbia's future lies in serving and connecting under-served markets with its perfect geographical position, what was also Turkish Airlines first step to growth and global reach we're seeing today. Bratislava and Chisinau are some of those markets and perfect examples. For now, Air Serbia has to establish regional dominance first, after what it should (and will) eventuallyexpand to markets such as:

      - Bratislava (ATR72)
      - Chisinau (ATR72)
      - Odessa (ATR72)
      - St. Petersburg (and other Russian major cities) (A319/A320)
      - Sochi (A319/A320)
      - Baku (A319)
      - Astana/Almaty, could be coupled with GYD (A320)
      - Yerevan (A319/A320), could be coupled with TBS
      - Erbil (A319)
      - Ankara (A319)
      - Amman (A319/A320)
      - Cairo (A319/A320)
      - Algiers (A319)
      - Madrid/Barcelona (very important for the Bulgarian feed) (A320)
      - Lyon/Nice (A319/A320)
      - Birmingham (A319/A320)
      - Dublin (A319)
      - Oslo (A319)
      - Helsinki (A319)
      *approximate aircraft type based on daily frequency for the period 2014-2017 (half-mature network), with high-seasonality on some of the routes.

      ...and the list could probably be continued. That is where Air Serbia will gather profit in parallel with securing the largest possible share of their home market in BEG, up to around 60% or more. Besides, having that business plan in mind, the E-Jet makes absolutely no sense and if i'm not mistaken already by next summer season we might see more than just 2 A320's (i suspect that being the reason why the A319's are so delayed) and end up with a more evenly split Airbus fleet or A319's and A320's. If you're gonna build a transfer hub, you're gonna build it by the volume which means a/c of at least 150 seats so that you can offer the lowest price per ticket vs. the competition. That is why they ordered 10 new A320 (what many people here seem or like to forget, that it is a firm order) and not A319's, which is just the interim solution. ATR72 is perfect for the destinations they serve and offers much more capacity than penalties vs. the other version. I hope that answers your questions.

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    29. The other city i could see them launch (that i omitted), that's definitely:

      - Naples

      One of the most undeserved airports in all Europe.

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    30. Those are all great potential destinations (perhaps Riga and Baghdad would be good too) but I don't think a daily A320 is possible on most of those during the next few years. I am just trying to be realistic. Even RyanAir began with the EMB110 and ATR 42 at the start.

      Almost every big transit airline has a "feeder" airline, Air France HOP!, Delta Connection, Lufthansa Cityline, etc. I don't understand why nobody thinks there is any reason to operate regional jets and smaller turboprops.

      Earning money comes from full planes, not operating big planes. A E-175 can still earn money with only 50 passengers, but an A320 with 50 passengers is losing thousands of dollars per flight.

      You are forgetting that Air Serbia is still a small airline in between a few major airports. Perhaps Air Serbia should at least have good connections to the neighboring countries before trying to take down Turkish.

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    31. I was also about to put-in Riga but i thought AirBaltic (or Etihad regional if they buy them) might launch it, the same as just happened with Darwin. Air Serbia has no plane for the route. As you can see, it isn't Air Serbia trying to take Turkish down but Etihad. As for the regional feeder, here you got it: that's the stated aim of Etihad Regional and we'll here many more developments on that very soon.

      I don't see them launching Baghdad in the same way i was hesitant to include Astana or Almaty in the list, just because it is too close or quite well served through the hub in Abu Dhabi.

      I maintain there is no point in such a small airline (less than 50 a/c) to have 3 type of airplane manufacturers. That increases costs much more than they would save if to send a plane 'a bit less emtpy' to a given destination. Besides, there is also cargo that counts and the A319 can take quite a lots of it, where the E-jet faces penalties. The only plane that could actually suit them was the SSJ, in big part due to its price, but i don't see them buying it for just a few routes. They simply have to expand their network symetrically in all directions and axes (North-South, East-West) so they could feed the waves and soon we might more be speaking on whether they need the A321 or not, rather than the E-175, trust me on that. (That was actually Etihad's first move, most of the destinations are on the Eastern side of Belgrade.) It isn't about megalomany or 'big planes', Air Serbia simply doesn't need jets less than 120-150 pax for its business model. On the other hand, they need additional ATR's for their regional network (and for me, 'region' that's much beyond Croatia, Slovenia and other Ex-Yu), that's for sure. Besides Bratislava, Chisinau and Odessa, they could open Tirana which is in the vicinty, what's i'm sure in their plans.

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    32. Here is what I think would be the perfect fleet for JU in 2020:
      ATR 42- 6
      ATR 72- 8
      E 175- 12
      A320NEO-12
      A321NEO-4

      That is only three different types of planes, and five different variants.

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    33. Hardly so. The most likely fleet will be:

      8 - ATR72
      2 - A319
      <20 - A320 (with a handful of A321 among those)

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    34. Aleksandar I generally agree with your fleet idea of having a aircraft that bridges the big gap between ATR (~70pax) and A320(~156pax) the A319 is IMO dead in the water as seen by the complete lack of NEO orders, however wouldnt the E190 or even E195 be better than E175? 175 is a bit too close to atr capacity wise (78-82) whereas E190 ~ 100 . Even the c-series is a candidate.

      Aerologic you contradict yourself in the same thread

      "I maintain there is no point in such a small airline (less than 50 a/c) to have 3 type of airplane manufacturers"

      but you just said :

      "Air Serbia is now part of a ~500 planes-strong alliance. That changes things quite a bit when talking about leverage."

      so ofcourse they can have 3 families as etihad could easily place these aircraft (E195-E2 or CS100/CS300) with etihad regional/baltic/cypres or whoever else they buy in the region.

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    35. ^Last anonymous, yeah feel free to substitute any regional jet for the E-175. I just chose it because it was rather inexpensive, and because it is proven and has a short back order list.

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    36. So do you see Etihad or Air Berlin (or even Jet) ordering Embraers? The answer is NO! Why would they need any leverage on a product they don't need? Seems i'm not the one who contradicts himself but some simply do not know too read or take things too much 'by the book'. Seems like some educational deformity.

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    37. Oh you contradict yourself quite often but self awareness is obviously not a strength of yours so I'll let it go. In fact your only consistency is in your hilarious attempts at put-downs like educational deformity, lack of knowledge and consciousness, welcome to the world ...and that's just from today.

      Now if you're trying to convince me that air serbia won't have a big gap between the ATR-72 and A320 (once the 319's are gone) or that they dont need a product in this range (100-125) then I don't know what to tell you I guess LH/AF/KLM and all the other airlines that ordered close to 1400 of these aircraft dont know what they are doing. And I don't need to repeat myself that it doesnt have to be embraer.


      I love that you're so confident in predicting what ETIHAD will or wont do when its based purely on your plentiful imagination. (Hows that for my first attempt)

      Delete
    38. People are wondering how Emirates or Turkish Airlines can fill a relatively large plane in some of the strangest places in the world, especially Emirates which operate only widebodies. Well, the answer is in the structure of their hub.

      As Air Serbia keeps on adding destinations and frequencies out of Belgrade, it will be able to offer a lot more cities from these destinations that are supposedly perfect for the Atr 42. People were wondering how can Turkish Airlines fill its B737-800 in Mogadishu or its A330-200 in Kabul. That's the same logic that should be applied to Air Serbia's Atr 72 destinations in the region. When JU reaches its goal of operating 39 destinations it will have no problem to fill an Atr 72 from any destination, especially the ones which are currently under-served such as Odessa, Varna and so on.

      The fact that Etihad is getting ready to sign an Atr order for its children airlines only goes to prove that there will be no other regional jets in the fleet of the airlines it runs.

      Delete
    39. Nemjee,
      there is a big difference between JU and Turkish and Emirates. Those are established airlines operating from cities with 20 times as many O/D passengers as BEG.

      Delete
    40. Aleksandar, you're clearly clueless about aviation business so for your own sake better stay-out of such topics in the future. No offence.

      Delete
    41. Aleksandar, why don't you tell me where Emirates were back in 1985 when they started building their airline? I suppose you are not aware that back then Dubai was nothing more than an outpost in the desert.

      Delete
    42. Nemjee, do you really think that you can compare JU in 2014 with EK in 1985? How many large airlines were around EK in 1985? Gulf Air and nothing much else. How many major airlines are around JU? How about Turkish, Austrian, Lufthansa, Alitalia, and even Aegean isn't small. Even in 1985, Dubai had a much better outlook than Serbia in 2014. Dubai discovered oil around 1965, so they knew they were set.

      I am just trying to be realistic. It takes more than just huge investment to create a major hub. It takes a lot of luck to break into an already existing market.

      Anonymous at 6:18, what makes you so qualified to judge? Are you a manager at an airline? Perhaps you are a CEO? No, you are a blog reader with as much experience as I have. Unfortunately, you think that JU can just walk in and set up a major hub in the least developed part of Europe. Unfortunately, that is not how it works.

      Delete
    43. Did someone ever tell you that you're an idiot?

      Delete
    44. Ok, so will you please teach to us "how is it gonna work"? Thank you.

      Delete
    45. This will be my last comment in this discussion, I personally find it pointless as we are never going to agree. The main difference is that Serbia is not in the EU so Etihad can pump as much money as they want into JU, something they can't do with Air Berlin for example. Air Serbia is also backed by Etihad management which has managed to build an aviation monster in just ten years. I fear that these people are far more qualified than both you and I hence why we should not treat them as our inferiors.
      Like I said it before, time will tell who was right.

      Delete
    46. Thank you Nemjee and Aэrologic for a good and polite conversation. It is uncommon to see such talk on this blog. Even though we disagree, I appreciate your comments.

      I can see that soon this thread will degrade to insults and name-calling, because apparently individuals from the Balkans are unable to keep a polite discussion going without resorting to insults.

      Anonymous at 9:44,
      I see. Instead of providing actual ideas and opinions, you must resort to personal attacks. Good bye.

      Delete
    47. mnogo odgovora pa ne mogu da upratim, ali neko je napisao da bi dobra ruta bila Jerevan u kombinaciji sa Tibilisije??? Imam bolju ideju. BEG-PRN-Jerevan-Baku- Dubrovnik

      Delete
  9. Ummm it's Christmas eve. You won't see a lot of people traveling between Banja Luka and Belgrade today or tomorrow. Other airlines, like for example Croatia, pre-cancels many of its flights on Christmas day in advance.

    ReplyDelete
    Replies
    1. then what about Sarajevo flight only one pax, if there was a boycott of B&H airlines there would still be more pax

      Delete
    2. Most of JA Sarajevo pax are business ones (until people get familiar with transfer options). Companies don't work - no pax.

      Delete
  10. @ Ex-Yu: Do you know when Air Serbia will publish its summer timetable officially?

    ReplyDelete
    Replies
    1. Delay for 10 days now! Nothing new

      Air Serbia = Air Delay

      Delete
    2. Aman vise prestani. Sta ste se okomili svi odjednom danas.

      Where on earth did you see the exact date the timetable will be published on???

      In these news, http://exyuaviation.blogspot.com/p/exclusive-air-serbia-new-route-launch.html

      they said: "Tickets are expected to go on sale soon."

      Also, it is still "holidays" season, many of them are here for Christmas and slavas, so they should rather promote existing ones than some completely new and different market as Kiev or Varna!

      Give us all a break and stop crapping.

      Delete
  11. If Adria misses profits with 73,5% load factor, no way that Air Serbia makes any money with 57%!
    I guess Etihad can't wait to take over Belgrade Airport and squeeze the money out there.....

    ReplyDelete
    Replies
    1. Few days ago in a SQ flight from JFK to FRA believe me or not LF where about 70% and after all does that mean that Singapore Airlines is a bad company?

      Delete
    2. Yes, what a shame they cannot reach 80% within two months... Shut down, right now!

      Kako vam bre ne dosadi...

      Delete
  12. Please don't compare the yields of SQ with Air Serbia....they have plenty of business travellers and F+C tickets sold....while Air Serbia presently dumps the tariffs just to sell the empty seats. I wish Air Serbia would have a better success, but knowing from my 25+ knowledge in the airline industry this is very hard to achieve with its business model. As far as I am concerned to turn BEG into a "hub" is the wrong strategy with selling tickets PRG-BEG-SKG-BEG-PRG for 199€ and below....Malev tried this and went under, CSA tried this and barely kept afloat....without long haul, this model won't work. That's why Etihad pushes for the airport...zivi bili pa videli.

    ReplyDelete
    Replies
    1. I'm more and more certain they'll go with longhaul. They're investing $1b into A320 Neos, more into the yet undislosed ATR purchase and it seems they'll be taking over BEG. This sort of an investment can only be paid back with strong profits later on and the only way this sort of a hub model can work is with long haul. I think they'll get 2X A330 (upgraded to A350 in 2018-2020 time frame) and use the long haul pax to augment regional revenue. With 600 extra daily pax, if just 25% are transfer pax, they would boost regional LF by nearly 10%.

      Delete
    2. Unfortunately it seems that you have not learnt much during those 25 years my friend as there are more than enough reasons to prove you wrong. Also, long-haul doesn't mean it has to be profitable. After all, Malév had it and they were bleeding money from it. ;)

      Also, Malév did not fail because of its pricing policy, it had much different problems.At times I really wonder if people check facts before posting on here.

      Delete
    3. Oh really? I have very close relations with AUA an I know from reliable sources that they barely make money on their European Hub. It's the money the generate from hub/spoke to long haul. And please compare the strength of the two local markets. I guarantee you 100% that Air Serbia will not make money with 4 coupon tickets via BEG at present fares. They can only make money if 70- 80% is O/D traffic and 20 -30% transit at higher levels. The transit yields are too poor. Just compare on swoodoo.com or similar and you will see that it will be difficult to raise yields since TK, Pegasus and Tarom also bargain from SKG, ATH, BEY, TLV and so on.....

      Delete
    4. Strange that AUA has not taught you about cost structure and how important it is when running an airline, especially when talking about the pricing policy. Also, looking at how 'well' AUA was run until Lufthansa stepped in, I am not surprised about your level of knowledge.

      There are sooo many airlines out there which have less than 70% O&D passengers yet they managed to make money and work on attracting even more transit passengers, you know, those you claim are not profitalble.

      Ah armchair experts, you gotta love them.

      Delete
    5. I have to agree with anon @2:21 there is no way air serbia can be profitable with this model of dumping tarifs and artificially increasing capacity, unless ofcourse the sheik treats air serbia like he treats his football club, where losses are an accepted part of doing business. Maybe thats where the airport comes in as a sort of 2 for1 (buy a bankrupt airline get a profitable airport for free, or at-least without a tender) If thats the case then nemjee is absolutely right, even 30% LF is a MAJOR success.

      Delete
    6. Last anonymous, do you mind giving us a more credible argument than your own opinion? I would also like to use this opportunity to remind you that Etihad, just like Emirates, is a very profitable airline. Even Turkish Airlines, an airline with 45% of its passengers being transit one, is managing to report a profit.
      Naturally that Air Serbia will dump prices in the beginning, it's the norm in business when you have a new product on the market. As time goes by the fares will go up and so will the passenger numbers because Air Serbia is a good airline in many ways.

      Delete
    7. Please dont compare air serbia to turkish or emirates, thats beyond silly. I'm not questioning the hub model, that would be stupid, it works, but the reality is there is only so many hubs(airlines) that can be PROFITABLE on a small continent like europe ( geographically ).Not to mention theres practically no business market to speak of, certainly not anywhere near some of the bigger cities, and thats where airlines like the ones you mentioned make their profit.

      A more realistic comparison for what air serbia could be is malev (although hungary is both bigger and richer) and yet we saw how that finished without a owner with bottomless pockets.

      Delete
    8. Yes, there can be only so many hubs in Europe, I agree. However, at the same time there is no serious hub between Vienna and Istanbul giving Belgrade a perfect opportunity to develop its own business.

      Why do people keep on comparing Air Serbia with Malév. They are two completely unrelated cases. Air Serbia has a clean slate, new management and a contemporary business model.
      Malév on the other hand had a lot of baggage from the communist era plus unimaginably high leases on their Boeing fleet. Actually, it was these leases that killed the airline. They were signed by the current CEO of Wizz Air who used to be Malév's CEO back then. The fleet restructuring plan was one of the main reasons for the airline's downfall as described by the Hungarian government in their white paper.

      So please, tell me, how come Air Serbia and Malév are to be compared?

      Delete
    9. There is no hub between istanbul and vienna but is there really a need or more importantly a genuine market for one? Do you realistically believe Belgrade is anywhere near the same league as those two?

      With regards to malev and air serbia. They are a lot more similar than you might want to admit. Malev was a perfect example for air serbia about what will happen to an airline that tries to become a proper regional hub with 20 nb's and one or two aircraft for a very,very limited longhaul service. IT CANNOT SURVIVE without government or private subsidies. Heck budapest airport had roughly 9 million passengers and they couldn't sustain it long term.

      Now I don't know how air serbia can make a true hub work with a fraction of that passenger flow. Thats why you hear about the still confidential air serbia deal, the no-tender airport deal, and thats why its my opinion that etihad will have to act as a sponsor of some sort or get additional sweetheart deals .

      If you really think Dane Kondic can buy 15-20 new aircraft, launch a hub from a tiny market (3M-pax when launched) and do all this with a profit, i'm not even kidding, he should be nominated for CEO of the century. Half of europe would try to replicate this model of manufacturing a hub from an airport not even in the top 100. If done purely on merit that would be fantastic, however the extremely secretive nature of their dealings so far makes me doubt we'll ever get RAW numbers to make that conclusion for ourselves.

      Delete
    10. So, according to your opinion, what should they do? Do you have a better idea?

      Delete
    11. I guess, according to you, CSA is a failure as well and both Korean and Etihad do not know what they are doing? Maybe the whole world isn't being run properly, but what should we do, sit and watch or try to find solutions, whether they're perfect or not? Can't wait to hear your proposals.

      Delete
    12. Don't be so dramatic, besides this is a blog don't be so deep. lol.

      I dont know if you consider CSA a success or not but they were absolutely following in MALEV footsteps, ("We only had two options: either find a strategic partner or consider liquidation of CSA (Czech Airlines)," Czech Finance Minister Miroslav Kalousek told reporters.) According to wiki they had a loss 5 out of 7 years 05-11, So you tell me is this a financially sound company???


      Look its understandable that Serb's are proud of air serbia and are unashamed fan-boys of even the tiniest thing (look at nemjee's declaration that a 30% LF is a MAJOR success lol) .Theres not much to boast about in the balkans, but when people start believing their own hype its a bit too much for my taste. Comparing air serbia to turkish, or belgrade with istanbul and vienna, I mean come-on...

      Delete
    13. And one more thing, you mentioned korean and etihad, they wouldnt be the first or last airline that is a (as we like to say in the balkans) SERIOUS company and knows what they are doing to make questionable financial decisions. Swiss air, panam and countless others were also serious companies and knew what they were doing...

      Or maybe they have learned and are now asking for and getting incredibly one sided deals, after all the successful CSA you speak of had 44% of its shares sold for an amazing 2.6M euros and air serbia seems to have come with a airport attached to it so who knows...

      Delete
    14. I haven't see anyone being dramatic as you say, but judging by your tone you're making a drama out of it yourself. In order to widen your horizons, i should remind you that there are many airlines, big and small, that went bust around the world. Each have their respective problems based on the nature of their business. Looking at that quite similar trio (central-east European medium-sized airline with good geographic location of the hub): CSA, Malev and Air Serbia, i would say that Air Serbia is in the most favourable position (well, CSA is now saved while Malev is long-gone) and has the financial means to make it work, what other two didn't have. It's all a question of time, as any investment. Air Serbia is now part of a ~500 planes-strong alliance. That changes things quite a bit when talking about leverage. What i simply don't see is a concrete proposal coming from the detractors. What should we do, close Air Serbia down straight away? Shouldn't have sold it to one of the most powerful airlines in the world? Shouldn't have gotten new planes? As the other guy said before me, if you have any constructive proposals i'll welcome to hear them. Otherwise i can only suggest you to exclusively deal with things that you're good at and not mix into those of which you obviously have neither knowledge or consciousness.

      Delete
    15. All that reminds me quite much of the voice that was saying "don't even dream Etihad is gonna send their pax to Western Europe and Scandinavia over Belgrade", well, that's what they're doing right now as we're talking about this. From the point of view of aviation, there many things to compare between Istanbul, Belgrade and Vienna, especially the first two. They're all conveniently located airports to house a major transit airline. Besides, BEG has probably the cheapest costs and the most space to develop. But, if you don't like to compare it with Vienna, i'm sure you'll show no objection to compare BEG with DOH. Well, we all know where was Doha 20 years ago. Money and time can do wonders, better enjoy them instead of being scared. Welcome to the world.

      Delete
    16. You managed to conclude I have neither knowledge nor CONSCIOUSNESS from a post on a blog? calm down will you, maybe you over-celebrated this Christmas in which case all is forgiven.

      Let me quote from your infinite knowledge and conscience " Money and time can do wonders" no truer words have ever been spoken, in fact I said as much when I referred to the owner with bottomless pockets who is ready to throw money air serbias way. So im sure you can understand my confusion when you start frothing at the mouth and get offended when you mentioned that same fact.

      I'm not scared, actually thats not true, the only thing I'm scared of is wasting my time trying to use general logic and facts up against views driven by nationalism or more precisely the nationality of anyone who doesn't sing from the preaproved song-sheet.

      Welcome to the world.

      Delete
    17. @ 05:03
      I am absolutely sure that Air Serbia is an SNS toy and give away to the sheiks for something bigger. I used to work for Air Mauritius and when the B747sp was to be replaced everybody (pilots, technics, sales, commercial) was going for B763, but since the airline is state owned politics got involved and the french blackmaled the government to by A343 or they would make the EU stop benefits for sugar cane imports. And there you go, since sugar cane is no1 export they got buy the A343 and business was run down, because this was the absolutely wrong plane. So, with Air Serbia I am sure that there is a backroom agreement with gentlemen hand shake. The airport, the land deals and so on. If the Sheiks makes 50m +x€ profit with the other projects, he will drag Air Serbia along if losses are not so high....and if not, they will dump it after the contract expires and just keep the airport! Now you welcome to the real world!

      Delete
    18. Yeah well the fact that this was initially politically driven certainly points to that direction, but thats the beauty of the confidential agreement, they dont have to tell anyone anything. lol.

      Delete
    19. '(look at nemjee's declaration that a 30% LF is a MAJOR success lol)'

      If you bothered to read my entire post you will know why I consider a loadfactor of 30% to be a major success. Jat Airways used to fly twice weekly to Tel Aviv and they maybe had a loadfactor of about 15%, Air Serbia flies four times per week, directly, and manages to record a loadfactor of about 30%. That means that in just two months the airline has managed to considerably increase its passenger numbers between these two cities.

      So let me put this simply for you: it went from two weekly flights with a loadfactor of 15% to four weekly with a loadfactor of about 30%. You do the maths.

      I am happy someone mentioned the Hungarian government's white paper on Malev. In it it is clearly outlined why the airline failed. It was not because it tried to build a hub but it was because of unfavourable leases on its B737 new generation aircraft. The leases were so unfavourable that the airline had to have completely full planes, overcharge passengers just to barely break-even.
      So no, JU and MA have very little in common and Malev's problems were of a completely different nature. These arguments have nothing to do with common sense or nationalism but rather with general knowledge in aviation.

      There are two more airlines which are much greater than the cities they serve. Icelandair is based in Kéflavik which is close to Reykjavik and this whole area has a population of 170.000. How many B757-200s and passengers does Icelandair have?
      Finnair is based in Helsinki, a city with no more than 350.000 people. However, Finnair has become one of the major carriers between Europe and Asia.
      So tell me, if these two made it, why shouldn't Air Serbia? All you need is a good business plan and deep pockets. Air Serbia has both,

      Also, if you are going to argue and play it smart then at least have the decency to have a nickname.

      Delete
    20. Sure, they'll dump the airline on which the airport depends, its largest customer. Good luck making money that way.
      With the fierce upcoming competition from low-costs in Zagreb i'm sure the Sheikh won't dare.

      Delete
    21. Helsinki is 350.000? are u sure? If you need to exaggerate this much to make a point...

      And as far as having "made it" Finnair has made a profit only 2 of the last 7 years (up to 2012) so if money is no concern then yes they have succeeded in getting some transit pax from/to asia.

      Now let me repeat myself for the umpteenth time and hopefully people will read what im writing not what they are imagining.

      I stand by my opinion that you cannot make a full-blown hub work with 3 or 5 or even 8 million pax. And I gave you two real-world examples in the region with bigger market size that failed, unless of-course things like money and profit dont matter in which case you can make a hub out of any number of cities in the region. In other words you don't need a really really good business plan or really really good lease terms you need a SAVIOUR, business plan be damned. Unless the arabs don't have a change of heart and pull out air serbia will ABSOLUTELY "make it", but that doesn't change the fact that the model/plan itself doesn't stack up for a market this size.

      My argument from the beginning was only that the business plan itself without the unlimited resources the sheik brings will not work LONG TERM. Not in the world of mega-hubs and LCC's. Please prove to me otherwise!!!

      I don't know if you are naturally ignorant of these global realities or just choose to be because it concerns an airline close to your heart... sorry

      Delete
    22. How many people are annoyed by Air Serbia? You don't have to fly with them! Give us a break, please! Ne smarajte nas vise svojim glupostima!

      Delete
    23. It seems that some people are "allergic" to critisicm....this is an open blog and everybody can speak out if he does not insult anybody.
      Air Serbia is an interesting topic and a bit it's also the government fault, because everything they announce is megalomanic and so little was delivered so far, so there is some tension in the air. The Air Serbia website was not really overhauled just cosmetical changes, 4 319 delivered although 6 were announced. Ex Jat pilots not ready for 319s , therefore Air Berlin, Adria and Etihad crews flying the planes costing lots of overhead expenses. New routes announced but still not open for sale. Usually new routes go 6-9 months ahead on sale. Lots, lots of delays....not much better performance the JAT. So, why should I (a Serb) shut my mouth only because we all should "love" the new airline. I want so see results and service upon I can judge.

      Delete
    24. Why are you so convinced that anybody gives a fuck of what you are thinking?

      Delete
    25. Well, time will tell in a few months who was right and who was wrong.

      Delete
  13. Bosanski bizmis
    http://aerovesti.blogspot.pt/2014/01/b-airlines-moguce-ukidanje-linije-do.html

    ReplyDelete
    Replies
    1. Not any serious company will cancel flights after merely a month in service, without proper marketing and planning to make the route work beforehand. This only goes to prove that BH is a lost (a joke of a) company, without any strategy whatsoever. I'm sure they have plenty of profitable destinations where their ATR can't wait to be deployed LOL.

      Delete
    2. That "blog" is a joke. Especially since it made up the CEOs statement.

      Delete
    3. The mosquito company is anxious about having better ideas where to place their flagship ATR, well, go ahead, but make sure you do the marketing right before launch the next time, for such a huge ship, it's not easy to fill all those seats on such a mighty plane...i get it now why they fly only to Zurich. B&H is about BigtHings.

      Delete

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