Friday, May 9, 2014

Hogan: Air Serbia to Chicago

Etihad CEO announces Air Serbia's Chicago plans

The CEO of Etihad Airways, James Hogan, has said Chicago will likely become Air Serbia’s first long haul destination, to be launched no later than the start of 2016. Speaking at a press conference in Abu Dhabi to present Etihad’s new in-flight product, Mr. Hogan said that a feasibility study into transatlantic flights has already been arranged with the Serbian government. “Air Serbia will connect the entire region. We plan to expand our network based on the Serbian, Croatian, Bosnian and Montenegrin diaspora”, Mr Hogan said. He added, “We will launch new routes and Chicago is the first destination we are thinking of”. Etihad’s CEO also added that the Windy City is a logical choice since it is home to the biggest Serbian diaspora but also a sizable number of immigrants from other former Yugoslav countries.

“Air Serbia’s management is doing an excellent job and I am very happy not only with them but also with the support from the Serbian government and all of Air Serbia’s employees. Etihad has employed 300 experts as well as cabin crew members from Serbia”, Mr. Hogan said. Air Serbia’s part owner believes the carrier will break even or might even record a profit by the end of this year. This is despite Jat Airways, for the first ten months of 2013, and Air Serbia, for the last two months of the year, recording a significant loss of 73 million euros (more of which you will be able to read about in the coming days).

Despite the European Commission’s recent investigations into Etihad Airways’ ownership into European airlines such as Air Berlin, Air Serbia and Darwin Airline, Mr. Hogan dismissed any concern. “We comply very clearly with the rules and regulations of Europe - we have to. It’s a nonsense that we don’t comply with it. It’s more about propaganda from our competitors. We have complied with the laws from each country and that includes Serbia as well. As a minority shareholder, we cannot control these companies”, Mr. Hogan concluded.

76 comments:

  1. Although I respect Hogan and tolerate Vucic, I am afraid that they may be making promises that they cannot keep. It is still unclear when (or even if) Serbia will get FAA Catagory 1 status. Besides that, I don't think BEG is ready for widebodies yet. This summer will be so overcrowded. Now imagine an additional 250 people for each longhaul flight.

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    1. cmon why beg wouldnt be ready for lh flights? ju can make it in evening time and can be parked anywhere as around 23h beg is almost empty, as we know. why you think 250pax is such a big problem at the evening time?

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    2. Well this way it won't be only 250 pax more, BEG would become significantly more popular as a hub, so number of transit passengers would hopefully rapidlly increase. Long haul means quality. So I think it won't be only 250 pax more once or twice a week, but a new reputation of BEG. And good reputation makes big responsibilities.

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    3. I meant transfer pax *, but also transit pax O &D pax, all the pax generally...

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    4. Starting up long haul flights is a milestone investment for any regional carrier. It is obliged to invest many financial and human resources into it and to wait for years to see whether it makes good revenue or not. While a regional carrier in case of weak revenue can simply change its business model with small investments (Adria as an example) a long haul service must be developed carefully and at any cost problems like delays, lost luggage and arrogant flight attendants should be avoided. It also means that flight service has to be excellent: good choice of food (just see what LOT offers on its long haul flights @ Airlinemeals.net - its an absolute acceptable minimum), good inflight entertainment with personal screens in all classes including economy - as its now standard on long haul flights worldwide. Once JU starts long haul flights they will enter the "eat or be eaten" arena with much larger and more experienced competitors. If they fail in it they will eventually go bankrupt like MALEV.

      To sustain all that and expect a revenue, an airline like Air Serbia must try to get a favourable fuel price. Air Serbia is in a bit awkward situation as they have to negotiate it from a Russian company for flights to USA, so there should be diplomatic and geopolitical issues. (Etihad is meant to provide cheaper fuel to JU just for return journeys but outbound flights are still powered with NIS fuel).

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    5. I just love "lets park plane at 23h, there is plenty of room" attitude...

      ORD might be telling us when to arrive rather than AiurSerbia picking and choosing arrival times...

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  2. While it's really pleasing that Serbia will (again) be linked to long haul destinations I'm not sure that it's a bigger priority than infrastructure work in and around Nikola Tesla airport and in particular the construction of an express train link from the airport to the city center. You walk to Paddington Station.... in 15minutes you're in Heathrow. You walk to Victoria ... 25 minutes you're in Gatwick. You have DLR to get you to City Airport. Amsterdam Schiphol to Central Station in 9 minutes. Maybe I'm spoilt but the thought of landing at Belgrade Tesla and then having to take a taxi is really unappealing and old fashioned. A w/e city break traveller wants to get to the central station and walk to their hotel instead of mucking around with taxis. Same for business travellers. It's the 21st century. Build an EXPRESS LINK !!!!

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    1. its not that easy.. its investment for around 50mil euros.. we dont have that money.. until than A1 or 72 bus link throughout dirty suburbs of belgrade, so tourists can feel the spirit of serbias capital :D

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    2. Even EUR100m is satisfactory for the return that linking the airport to the city would generate. That's why it's called an investment.

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    3. Not just it is expensive, but it would take a long time...

      It would be nice to have a direct express bus link from the city center to the airport, but via highway. This way it would really be something. A1 and 72 are too slow. Maybe from Glavna zeleznicka stanica (in front of it), then Nemanjina, then Kneza Milosa, and then highway.

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    4. there should be an easy solution to it: introducing a new bus route that will exclusively use the motorway and stops ONLY on Sava Centar and Slavija square. That service would see little traffic jam and traffic stoplights. Another line should also connect the airport with the new bus and train stations being buiilt in Blok 43 and Prokop and use the Ada bridge. A1 is cranky as it tours you around New Belgrade and uses little of the motorway so it takes much time to reach the airport.

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    5. The economic benefits of an express train link would outweigh the cost. You've got to spend money to make money. The distance is not huge and it could be completed in less than a year. It would increase Belgrade's competitiveness in many areas. As things are, first impressions of Belgrade are very poor.

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    6. Have in mind there should be a double track railway. If it goes from Tosin bunar and ends at surcin Freight train station it would be some 16km long with two tunnels (Bezanija and under the airport itself) with total length of some 5 km. The entire project including tracks, signaling, stations and rolling stoch would be over EUR 60M.It should payback only if BEG generates five million O&D pax. Good thing should be if they build that cargo terminal, then the rail investment would be not only justified, but also a must.
      With clear finances they should need 30 to 40 months to complete the development

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    7. It's already a must.

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    8. Wow, less then a year. Maybe in some other country :) .

      Direct express bus link via highway would be good for beginners :)

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    9. To connect airport and citycentre with train is big investment. Belgrade don't need express link to airport. Just biggest airports on world can have direct express train to city (nonstop train from airport to citycentre).
      Because BEG even with 5.000.000 pax will not be enough to have direct express link, to generate enough passengers for so big investment. This should be extension of existing suburban trains. With this train link Belgrade solve problems of connection suburb parts of Belgrade with city centre, not just connection of airport. This solution will increased number of passengers in this trains.
      If I can correctly see, there is some kind of corridor from station Tošin bunar thru Stara Bežanija and Ledine almost to airport. With this city solve problem of fast connection this part of Belgrade with citycentre and also connection with airport.
      Direct and fast connection from this part of city will increase cost of land and it will be interesting place to live.
      So go ahead with this project, but only as suburban train.

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    10. You guys are really funny. Firstly, you're probably not aware of the current state of Serbian Railways, it's carriages and on-time performance. I would not dare rely on Serbian Railway to take me to the airport. The fact that the trains should be running at half-hour intervals (minimum) makes it even more impossible by current Serbian Railway standards. The cost of a railway link (from where?) to the airport is such, that it would be cheaper and would make more sense to buy 20 luxury helicopters and just fly the pax to/from the city centre. Of course, this would be a little over the top, so a luxury (Etihad-style) bus service from the airport to Sava Centar and not Slavija but in front of the Skupstina grada would make much more sense and would really be feasible.

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    11. As I understand the AS focus on transfer pax. So why expenses to construct fast rail connection?

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    12. Slazem se sa Acom u potpunosti.

      Uzmes liniju ili da ide od zeleznicke stanice (tamo ispred nje, gde polaze autobusi tipa 511, 601 itd) ili od autobuske (lastine ili BAS), modifikujes sedista, ugradis mozda neke korpe ili pregrade za torbe kao sto postoje u A1, opremis autobuse da budu novi Solarisovi i furaj. Bitno je da autobus ide AUTOPUTEM i da bude brzi nego A1 i 72.

      Ili moze da polazi od Slavije, onda Kneza Milosa, autoput, eventualno stane kod Sava centra da pokupi jos neke ljude i vozdra.

      Sad ce evo cela Srbija da se podredi Aerodromu Nikola Tesla i Er Srbiji. Do Budimpeste se putuje vozom ko u vreme kralja Petra Karadjordjevica, al ipak sve treba da se zaustavi i da pocne da se gradi ekspresna linija voza do Aerodroma. Smesno..

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  3. O.T. YU-ALP will arrive today from Lelystadt.

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    1. do you know is this the last ATR to be refurbished?

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    2. There is one more , YU-ALT.

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    3. Right now JU105 YU-ALP

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    4. It arrived at around 18.15, it is featuring the new livery but the interior is the same. It actually looks quite ok on the inside and I suppose there was no need to refurbish it. YU-ALT returned some weeks ago and it's white but I doubt it will go to be repainted before the end of the summer season.

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  4. It's not fair, he forgot to mention the Macedonian diaspora, I'll share this info with my friends in the windy city so they can avoid Air Serbia :)

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  5. Air Serbia and Austrian Airlines has no more codeshare flights between on the route BEG-VIE/VIE-BEG! does somebody know why?

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    1. Isn't it obvious? Austrian is a Star Alliance airline and a subsidiary of Lufthansa, which Air Serbia is naturally competing against.

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    2. How sad, bu-uhuuhu-huu, poor AUA, they're like a little spoiled kid, deciding to break off the codeshare flights now that JU is getting to be a decent airline.

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    3. Don't be so stupid Aca, why should OS codeshare with JU/EY

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  6. when will AirSerbia announce financial results for Q1?

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    1. There is no law abiding obligation for companies doing business as registered entities in Serbia to publish quarterly results. The only financial report they have to submit is the yearly one.

      I'm sorry but you will just have to wait.

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    2. Quarterly reports are obliged only for fully listed companies at the Belgrade Stock Exchange (only 8 companies are fully listed). BEG is one of them.
      Btw, Q1 report is due to be published until May 15 at www.belex.rs

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  7. Congratulations to Air Serbia, Etihad, Belgrade airport and all the other parties for their courage and vision! This is in stark contrast to the comments of the PR person at the Ljubljana airport some years ago "that it is not common to make intercontinental flights from regional airports". Let's wish them all the best!

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    1. I do not see a problem with that comment. Long haul flights from regional airports are indeed not common these days - any regional carrier would have to have a serious investor behind its back to even dream of long haul. MEB3 are perhaps the only such investors at the moment - and only one of them is actually investing abroad. So it makes a practice we really could not call "common".

      Personally I think it is a bit pretentious to announce long haul while the FAA Cat1 is still uncertain and the availability of old 733s is the only thing that prevents JU's timetable from going south. Long haul is a serious project that should not be launched while some basic operational foundations of the carrier are at stake.

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    2. All of those issues should be resolved by late 2015/early 2016. I think Hogan knows what he's talking about.

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  8. I believe most of this is PR hogwash. Talked to some people doing market research and route planning for Air Serbia. They said that there is no way this routes can be made profitable in the next few years because they will lack business class passengers on these routes and that nobody in the company is seriously considering this move. The 2016. deadline may be possible, but only if the Government decides to subsidize the line to satisfy Vucic's appetite for political self-promotion.

    This is of course not the official company stand, just their informed opinion.

    What they said to me is ofcourse not an official company opinion, but their informed opinion.

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    1. I reckon Sydney (Serb expats) or Bangkok (holiday destination where Serb dinar can go further) would be more successful routes than the US. Then again, I'm not in the aviation industry so what do i know.

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    2. Not a single European airline has been able to sustain direct flights to Australia, not even those with massive transit hubs, such as Lufthansa.

      Bangkok is a similarly low-yield destination and unprofitable for most established carriers.

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    3. Clueless. Australia is low yielding and requires a number of airframes for very little return. Can't see too many Serbs having money to pay for a J class seat. Bangkok again is very low yielding

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  9. I'm following the @AerodromBeograd twitter account and I'm seeing more and more transit pax. There is a disproportional amount of Turkish pax transiting through BEG. Anyone know why?

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    1. Some of them are O&D, Belgrade is popular city break destination in Turkey as it does not require visa.

      Further, I have seen a number of pax from SAW transiting to Italy via BEG (and vice versa). Turkish carriers offer quite expensive prices for destinations in Italy and you can save as much as 100 euro if you fly JU from SAW to FCO/MXP via BEG.

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  10. Today I bought 2 tickets for Bucharest for just 95 EUR (return ticket). Super for me, but I don't thing that will bring any profit to Air Serbia. So, on Monday 19th May and on 20th May back I will see Belgrade airport from inside and Air Serbia from my experience. For sure that would be interesting article in Aeronautika.

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    1. I believe you got them on a happy friday sale :) ? Just saw the advertisement on facebook.

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    2. I thinK this will be interesting to share with us, thanks!

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  11. Mr.Hogan can forget Croatian diaspora in his calculations!

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    1. To ti misliš, gde počinje ekonomija tu nacionalizam prestaje.

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    2. I can tell you this, of all Croats I know in US, would rather fly with Lufthansa for $200 more per ticket than fly with Air Serbia.

      Also most Croats can afford extra $200 on once a year travel to their homeland and there are loads of choices to choose from. Air France, KLM, Iberia, British Airways, Lufthansa, Austrian Air, soon AlItalia, not forgetting code share agreements with United, US Airways.

      Most Croats would rather fly with any of these airlines than Air Serbia any day, excluding purger, he is a special case, he would fly only business class cause he's above the rest of all of us, he even has a chafer to drive him around, if I knew journalism was such a profitable profession I should have become one long time ago.






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    3. Why do you think Lufthansa would be a mere 200$ more expensive? You know that the cheapest US-EU ticket on LH during the summer season is around 1400$, right? And even those are difficult to come by.

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    4. anon @ 5.56pm ... Dude, you're a massive failure before even starting on your journalistic exploits ... The correct way to spell "chafer", is actually chauffeur. First rule of journalism is the ability to spell and articulate yourself ... My advice ? Stick with your current day job and leave Purger to do what he does best - keep polishing his crystal ball and try to predict what happens next in Balkan aviation ...

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    5. Why would "all Croats in US pay $200 more to travel with LH instead of Air Serbia" ... Can you pls explain the logic in that ?

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    6. There is no logic involved here. I used to be that American diaspora, I knew many Croats in Sacramento and San Jose area. I have to agree with the first anonymous, NO, these Croats will not step their foot in a Serbian plane nor will they step their foot in Belgrade airport. They will pay more, even $500 if necessary and choose any other company which will fly them to Croatia (any stopover in EU is OK).

      These people are still stuck in the times of Yugoslavia, they always disliked (I am being polite here) Belgrade and always saw is a capital city of an enemy state.

      Like I sad there my not be much financial logic here, but rather a lot of emotion which will rule their wallets. Besides, there are a lot very good connections from the States or Canada to Croatia. There is no reason to substitute Belgrade as a stop over instead of Frankfurt, Amsterdam, London, or Munich. Really, none.

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    7. AnonymousMay 9, 2014 at 7:30 PM,

      Perhaps your circle of friends is less willing to fly through Serbia, but I also live in the Sacramento region and I know many Croats who have put the past behind them and are close friends with me.

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    8. Ni nemoraju da lete ima ko ce.
      Ja sam znao vec duze vreme da ce leteti za Chicago samo nisam znao kojim Avionom.

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    9. @Aleksandar Stojanovic, OK, so you have Croatian friends and you perhaps meet at Croatian Extragavanza in June. So did I.
      Still, they will not fly Air Serbia nor use Belgrade Airport. They might openly admit this to you, or they may not.
      And there is no need for them to fly Air Serbia, the connections via big European hubs (and any of the big three Alliances) will suffice all their needs.
      Regardless of that, Serbia does not even have FAA Category 1 yet, so this whole story is nothing more than usual hogwash.
      But I do enjoy all these megalomanic stories.

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    10. Anonymous at 9:37 PM
      Posto vidim da ste nenormalno ljubomorni na Yu. Samo da vam kazem niko ih ni nebi pustio u Avijone Air Srbije.

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    11. Yes, Hogan is a typical Balkan megalomaniac who has nothing else to do but to hype Air Serbia's "imaginary" routes. Seriously, are you that dense?

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    12. Jel' u AviJone kao u "PatriJoti"?
      Hhhahahahahahaha....
      Pa bas bi mogao Vucic bar pismene botove da bira

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    13. No, Hogan is succesfull businessman whose company will earn A LOT of money for lease of planes and passengers fed from BEG market, which ALL will be paid by serbian citizens

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    14. I didn't hear such a stupid comment for a long time. If you are surrounded with people who will not fly with a company only because of the name and origin, than you have only idiots around you! So ask yourself who are you getting in touch with. I know a lot of Croats from US who don't give a shit about it! They will never pay 200$ more only not to fly with Air Serbia. Of course there are still such people but they have a choice and they can choose another company. But don't troll with the fact that Croats will not fly with Air Serbia.

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    15. Inace su Srbi nacionalisti a svakog dana se otvara po jedan IDEA supermarket a svako drugi pusi Ronhill. Isto ce biti i kad nadam se JU pocne prekookeanske letove, mada nam hrvatska dijaspora ni ne treba. Hrvatski gastarbajteri su vec izvrsavali teroristicke napade na JU avione (let 367) i zbog toga ne bi ni trebali da se trude da ih privuku...

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    16. Gospodine Miroslave svaka cast na komentaru.
      Ali Ljubomora je najgora bolest na svetu.
      Niko ih ne tera da lete sa Yu.
      Ni ja ih nebi ni pustio.

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    17. E moj Miroslave, jadni su ljudi koji za celu naciju govore da je ovakva ili onakva. I Srba i Hrvata, i svih ostalih na planeti, ima i dobrih i losih, i pamethih i glupih, i nacionalista i otvorenih i tolerantnih. Sto se tice leta JU367, oborila ga je ruska raketa jer je preletao blizu teritorije na kojoj je tadasnji "Istocni blok" izvodio vojne vezbe. U cilju dobrih odnosa sa "prijateljskim socijalistickim zemljama" sve je zataskano i okrivljene su ustase. Da se razumemo, ne kazem da nije bilo teroristickih ustaskih zlocina, bilo ih je, ali niti je to bio slucaj sa letom 367, niti su to radili hrvatski "gastarbajteri" koji ogromnim delom upravo spadaju u grupu koja bi rado letela bilo kojom ex-yu kompanijom, vec je to radila politicka emigracija, koja je promenom sistema i novih drzava nestala. Dakle tvoj je post, nazalost, uz duzno postovanje, potpuni promasaj

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  12. I don't quite understand why they abandoned the JAT brand if they were going to look at buying up other regional airlines (talk of Montenegrin) and were also going to create a regional hub by starting intercontinental flights to places that JAT had a presence in prior. The targeted diaspora, unless they are on this blog or interested in aviation, won't know who in the world Air Serbia is, but they would recognize the name JAT.

    Either way, I wish them well because it would be nice to connect in a place where the language is familiar.

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    1. Exactly because everybody knew JAT ... fixing brand was probably more complicated then making new one.

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    2. Jat was toxic. They needed to start fresh.

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  13. I saw on AirSerbia facebook page, in the reviews section that there was a flight that was suppose to fly from Sarajevo to Belgrade, but diverted from Sarajevo to Banja Luka to pick up some passengers, and then flew off to Belgrade.

    Is that legally allowed without any special permission? That Serbian company flies between two Bosnian cities?

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    1. Well, it clearly is.

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    2. Good source for you is "Freedoms of the air". For this example, it is allowed, but it is not allowed to sell tickets for passengers between SJJ and BNX (onboard are passenger to/from BEG)

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    3. Thanx. Did not know that.

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  14. Od osnivanja pa do danas, "uspesna" AirSerbia je vec nagomilala minus (dug) od 70k evra! ABNT-u, NIS-u JatTehnici, SMATSA-i... Nikome nista ne placaju, zato su "uspesni"! Doduse niko ni ne sme da im pomene dug, u protivnom australijanac hercegovackog porekla krece u napad!

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    1. E aj ne se*i ... dug od 70K i nije nešto to je 70.000 evra...a ti si očigledno veoma obavešten vidim...

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  15. @ Pero, dug za proslu godinu je preko 70 MILIONA EVRA, a bice po svemu sudeci slicno i ove godine. A ako krene i Cikago bice i vise stotina (miliona evra). Ali ocito je da Hoganu to odgovara, jer se njegov posao siri, pare za najam aviona Etihad uzima, a gradjani Srbije placaju. Eto Pero, to pise u ugovoru, ako nisi znao da te obavestim, pa ti i dalje vici ljudima da ne seru. Aj'zdravo

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    1. Anonymous at 10:14 PM
      Gospodin Pera Kojot je upravu.
      100% Etihad oce da se obogati od nas Srba.

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    2. Prvo, ne kaze se "oce" nego "hoce". A drugo, Etihad je vec bogat, ali nije ni crveni krst, ni centar za socijalni rad, nego koristi svaku priliku koju moze da ostvari profit. Idealna prilika je u zemljama sa visokom politickom korupcijom i slabom kontrolom javnosti.

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  16. I’m really touched about concern for our pockets, stated by our neighbors. Let Air Serbia running its business even it is long haul service. Nobody wants to go under red line, even politicians in this moment in Serbia. Long haul debt can be covered by : (a) increase feeding flights and their LF, (b) making better conditions for tourist visits , (c) enlarging network possibilities. Maybe codeshare with Jet airways as India lost N1 category for US, or with Caspian countries, besides Balkan. Maybe long haul plan will failed, but it is worth to try, particularly when big brother stands behind YoU. My only satisfaction will be if we got more opportunities to fly with decent company, providing us with reasonable price and good service. If TAP can do it, even to US airports why not Air Serbia or Croatia airlines, or maybe joint venture of them.

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