Sunday, June 19, 2016

Adria sees passenger decline


Adria Airways has seen its passenger numbers decline during the first five months of the year. The Slovenian carrier handled 381.300 passengers during the January - May period, a decrease of 8.8% compared to last year. The Slovenian carrier attributed the weaker figures to the suspension of its charter flights to Egypt following last year's downing of a Russian passenger plane over the Sinai province, in an apparent terrorist attack. Furthermore, its figures were impacted by the suspension of a number of services to the Belgian capital in the wake of the Brussels bombings. Adria also discontinued services from Ljubljana to Istanbul and Stockholm, as well as from Tirana to Brussels and Paris earlier this year. On the other hand, it has introduced flights from the Polish cities of Lodz and Rzeszow to Paris, as well as from Olsztyn to Munich, with a new seasonal service from Pristina to London to be launched today.

The Slovenian carrier is in the midst of a restructuring process, following its recent acquisition by German turnaround fund 4K Invest, through its subsidiary AA International Aviation Holding. The new owners plan to swing the airline back into profitability. As a result, services to Berlin will be discontinued at the end of the season, in late October, and turned into a seasonal summer only route. Furthermore, the number of employees will be reduced. There have been some layoffs and replacements already, although no large-scale redundancies are planned. The new owners have not given a timeframe as to when the carrier would turn profitable. Last year's financial results are expected to be published during the first half of July, with the airline tipped to post a loss of several million euros.

In the coming period, Adria is set to focus on improving its passenger services. Late last year it introduced in-flight entertainment on board its aircraft and last week rolled out a new fare structure, allowing travellers with hand baggage only to book fares at a discounted rate. The carrier plans to conclude codeshare agreements with Sky Team-members Air France and KLM, on its services to Paris and Amsterdam. Adria recently leased a Bombardier CRJ900ER aircraft and is operating a number of flights on behalf of Austrian Airlines and Air Serbia this summer season. Furthermore, it has continued its cooperation with the Estonian national carrier Nordica, which uses Adria's Air Operators Certificate (AOC). According to an agreement between the two sides, the cooperation is set to last until the end of 2017, however, Nordica has said the deal is likely to be extended and deepened.

58 comments:

  1. Expected considering the suspension. It will be interesting what will happen in winter.

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    1. I'm also interested to see what their fleet will look like and wheather they will be leasing out planes.

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    2. Yeah, will they get rid of that CRJ200? They planned to retire it almost 2 yrs ago but it's still flying.

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    3. WITT 2016-17 shows flights with CR2, for example on days 2 to ZRH and MUC

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  2. Hopefully this doesn't turn into the recent restructuring where a lot of lines were closed and in the end it did nothing for finances, as will be seen with 2015 financial result.

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  3. Are they going to sell Adria after they "fix" them?

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  4. Let's wait and see. I don't think they should fly to unprofitable routes just so they could boost their destination count. We have to give these guys a year before we can pass judgment.

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  5. Still think it would have been best to have somehow linked OU and JP together, with the support of Lufthansa. They could have created a much more competitive airline. They could have focused on Bosnia then and developed flights there too.

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    1. Consolidate OU and JP into Eurowings?

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    2. Who knows, maybe 4K will shrink and fix Adria and then sell it off to Lufthansa which will absorb it into Eurowings.

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    3. As long OU is run by politicians and not businessmen, we will not see a merger
      sooner or later something will need to happen, cant be that such a small market has 4 airlines.

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    4. I think I am in the minority here when it comes to the merger. I don't think it could work, partly because both sides will want to run the show and I don't know how willing they will be to compromise.
      Both companies have moved on to different kinds of business models and they should work on that. OU, just like JU, needs to prepare itself for the full on attack by the LCCs. I am not talking about seasonal flights to the countryside, I am talking about increased competition at airports primarily catering for the needs of the O&D passengers.
      Sooner or later, ZAG will want to attract either Wizz Air or Ryanair which could spell the end for OU- just like it almost killed Jat six years ago.

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    5. Exactly. Get ready for the LCCs which are becoming more and more a threat to the national airlines. And the size is not everything but crucial if you want to compete with the big ones.
      current size of JP and OU are ridiculous, thats why something needs to be done. And every year they wait longer the chances for a succesful project is shrinking up to the day you can trash the OU JP YM logos

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    6. My guess is that YM is already beyond salvation, they've waited for too long and they've done little to improve their performance. I don't know how they will survive the winter season.

      As for OU and JP, I doubt 4K will want to work with the political appointees at OU. Maybe JP could operate some flights for OU like they are doing for JU this summer season but even that is highly unlikely.

      Finally, OU seems to be lost and without any direction. Seems like they are stuck in the same situation as AB, they can't decide what airline to become and on what market to concentrate. While they are aimlessly wondering around others are reacting.

      We've all seen now that FR and W6 are on the move. It won't be long before Eurowings starts expanding and responding to these developments. They are still setting up shop in Germany but once it's done they will add their own flights.

      You know what they say: a tactic that drags on for too long becomes a drag.
      This is especially relevant for OU.

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    7. Yep, poor prospects
      imagine we would hve an Adriatic LCC which links ex YU with nearby places in Hungary, Romania, Greece, Italy, Albania, Austria, BG, but also UK, Germany, Spain, FR etc
      but mostprobably its already too late for it.

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    8. Yeah, that could have worked about a decade ago. The aviation landscape has since changed. It will be interesting to see how things develop in the coming months.

      I think a lot of things will become clear this winter season.

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    9. problem for Croatian Airlines is winter schedule, reason why perhaps they plan to initiate Sarajevo and Pristina.

      In summer months Croatian Airlines can't cope with volumes, demand is greater than OU's capacity to supply the market.

      OU can't be sold as is, it is of vital importance for Croatian tourism and any would be investor must understand that.

      OU future is secured, however any expansion can't happen as long as ineffective management is allowed to run the airline.

      Lufthansa Group would be only viable buyer of 45% at some point in the future, however for the above reasons I don't see OU being ever sold to anyone.

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    10. I disagree that OU's future is secured, quite the opposite. With each new flight added to the country, there is less need for OU. Look at what DBV is doing by attracting foreign airlines to step in since OU won't/can't.

      It's exactly because of this seasonality that they have to decide on what model to implement. The current one can't and won't work in the future no matter how hard they try. They will end up like Air Berlin.

      One can argue that Cyprus Airways' role and importance was far greater than that of OU yet they went bankrupt.

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    11. Cyprus has no internal market, it is purely a holiday airline, 700 000 Cypriots isn't a market, airline can't be sustained, especially with low cost and holiday airlines galore coming to Cyprus.

      Even Olympic went bust cause of the same mentality. Tourism is important, but can't be relied on.

      OU on the other hand has an internal market, in fact winter flights for Dubrovnik, Split are in high demand.


      Problem is, that OU's strategy for winter months isn't clearly defined and instead of feeding Zagreb as hub for 3rd destinations, OU likes to little in that respect.


      Fine example, OU could have flights out of Sarajevo for Berlin, Stockholm, Amsterdam, Frankfurt, Paris on a daily basis, if at OU someone came up with idea of getting a plane to Sarajevo and offering these flights via Zagreb. So A 319 would start in Sarajevo, fly to Zagreb, pick up additional passengers and continue on to 3rd destination.

      This way OU would secure Bosnian traffic and Croatian. However this isn't what OU is doing.

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    12. Yet a country with roughly 800.000 inhabitants welcomes as many passengers as Croatia does. Not to mention that they had airlines like Emirates operate 10 weekly flights long before a link to Dubai from Zagreb was even considered. Even Qatar operates more flights to LCA than they do to ZAG.

      Cyprus might not have a domestic market but it has something Croatia doesn't, a wealthy population that travels a lot. Out of the 7 million passengers that use Larnaca and Paphos only 1.7 million are tourists, the rest are not. If that's not impressive then I don't know what is.

      Winter flights out of Dubrovnik and Split are in high demand? Really? That's not the impression I got. Larnaca has more passengers in winter than SPU and DBV combined. In February 2015, Paphos welcomed a bit more than 70.000 passengers, how many did SPU or DBV have?Let me help you out, DBV welcomed 13.000 passengers at that time. ;)

      Lastly, I don't think SJJ is interested in attracting OU, they have their eyes set on Wizz Air. The time for OU's regional expansion is long gone, that ship has sailed.

      In conclusion, if Cyprus Airways went bankrupt then there is no reason to keep OU alive.

      p.s. Olympic did not go bust, it was bought by MIG and later on sold to Aegean.

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    13. Let ma also add this:

      2015

      Split: 1.955.400
      Dubrovnik: 1.693.934

      Paphos: 2,277,741
      Larnaca: 5,330,914

      Cyprus: 7,608,655

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    14. No idea what the structure of passengers structure in Cyprus is, the fact is Cypriots have only air and boat if they wish to leave their island.

      Croatia has just started its economic march, joined the EU in 2013, exited the recession in 2015, this year projection is 3% growth, things are looking up. Split, Dubrovnik and Zagreb are getting new terminals, you come to me in 2020 and tell me how Croatian aviation is doing and traffic.

      I predict 2020.

      Zagreb: 5.000 000
      Split: 3.000 000
      Dubrovnik: 2.500 000
      Zadar: 700 000
      Pula: 700 000
      Rijeka: 300 000
      Osijek: 250 000

      And I am being very conservative here.

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    15. I think those numbers are unrealistic for ZAG but time will tell.

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    16. @NemjeeJune 19, 2016 at 9:30 PM

      Yes, indeed, however I am hoping for very good 2017, excellent 2018, spectacular 2019 and exceptional 2020. :D

      2016: 2.8 million
      2017: 3.2 million
      2018: 3.7 million
      2019: 4.4 million
      2020: 5.0 million
      2021: 5.7 million
      2022: 6.1 million
      2023: 6.5 million
      2024: 7.0 million
      2025: 7.5 million

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    17. Nemjee don't compare Cyprus with Croatia. Failure!!!!! Cyprus is a clear airplane destination while Croatia is a car/bus/airplane destination.

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    18. Let me add: in 2015 croatia has also almost 7 mio. Pax by plane although it is not a clear air destination

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    19. AnonymousJune 19, 2016 at 10:12 PM

      Which is why I said that time will tell. Remember how we all got excited about BEG in 2013 and 2014 and then things slowed down. :)

      easyJet

      What's with all the exclamation marks? Are you that excited? Also, if people compare Croatia and then Serbia then it's fair game to compare Croatia to Cyprus.

      For those interested, JU 506 LCA tonight has 6/98.
      Fantastic load in business class!

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    20. Yes and I will add that Cyprus has 800.000 inhabitants and Croatia has around 4. ;)

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    21. @?NemjeeJune 19, 2016 at 10:33 PM

      Actually Croatia's population is 4.3 million, with 300 000 non-Croatian residents also residing in Croatia on temporary basis for total population of 4.6 million. 520 000 Croatian nationals also visit Croatia (spending up to 30 days) in Croatia each year for total population of 5.1 million.

      If we are being pedantic.

      of 324 000 or so temporary residents, half are from Bosnia, 72000 from the EU and the rest from elsewhere, some 22 000 from Serbia.

      Illegal immigration is estimated at 67000, mostly from Bosnia, Serbia... Data for 2012, Croatian statistics office.


      Add at any time there are 500 000 additional tourists in Croatia you get nearly 6 million ppl residing in Croatia at any time.

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    22. I was going for the 4.3 million one as I think that's the official number but thanks for the extra info!

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    23. @11:01PM

      Are you positive that there are 500,000 tourists in Croatia at any time? June-September, sure, quite possible, but October-May? Half a million? According to Croatian Ministry of Tourism, there are 237,000 beds available in the entire country. That would put your number at double the amount of available hotels, apartments etc. in the entire country, which would mean that 200% capacity is used over the entire year. That seems highly unlikely.

      Also, each country receives its expats, immigrants and so on - population is the sum of permanent residents of a country, regardless of nationality or legal status.

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    24. What means 6/98 ...

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    25. Sorry, six passengers in business class and 98 in economy.
      It's a shame there was a massive storm last night as an A320 (YU-APH) was scheduled to operate the route but in stead they got a B733 (YU-ANJ). It's not so much a problem for economy passengers, it's more of an inconvenience for the business class passengers.

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  6. Bad news for Adria and Ljubljana Airport.

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    1. Yes so bad they will put on a hat with black lace and cry all day like widows do!!!! Come on are you serious, they don't care at all!!

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    2. Some months ago someone wrote here about 10% pax growth at LJU this year..

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    3. Yeah, that was a joker :)

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  7. Sorry, just another useless airline ... it is doomed, latest when the region gets a decent amount of direct connections, soon to happen after the LCC expansion and their shift to the main airports

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    1. Same can be said for all ex-yu airlines...

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  8. Will they cut anything else besides Berlin in the winter?

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    1. As far ad Ljubljana is concerned I think that's it although they will probably cut frequencies.

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  9. But they are not loosing so many money as before. That a good sign.
    More pax and more debts or less pax and less debts.
    The choice is yours.

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    1. I would put any money on that. So far, this year's loss has amounted to 7 million EUR.

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  10. LJU-SXF was run by Easyjet a couple years ago and it did not work out.
    I hoped that the smaller aircraft with 3 weekly frequencies might bring them success. Lets hope Berlin will remain at least a SUTT destination

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  11. There is no need for so many airlines in the Ex Yu.One for the region will be enough and the rest will be LCCs.
    New Adria owners see this the same because they seem to transform Adria into something like Estonia Air2. Something that has nothing to do with Slovenia at all.

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    1. And which one for the region should that be?

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    2. It should be one that at least flies daily to every capital in the neighbouring countries.

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    3. If I live in Ljubljana what do I care if there is a daily flight from SKP-SJJ, or BEG-TTG or ZAG-SPU, I care about what connections are available from LJU.

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    4. Yes and thats the point. From Ljubljana there are not connections to a whole lot of cities, not even once a week.

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    5. What's the point? How will only one legacy carrier from the region effect connections from LJU?
      Adria will likely remain as is for the next few years. With constant tinkering to the schedule and network. The only hope for new routes from LJU is with low costers, and this will eventually happen.

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    6. I think the routes flown fm LJU are not that bad for a small airport like LJU: they have reg flts to TLV IST ATH SKP PRN TGD BEG SJJ TIA VIE ZRH MUC PRG FRA CDG BRU AMS LON MAN CPH HEL WAW AND SVO

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    7. Some of these are seasonal and the frequencies are so-so.

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  12. Admin , any news for loads of first flight today Pristina-London Luton-Pristina with Adria Airways ?

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  13. Slightly OT - Why did JU decide to send the CRJ900 to SOF and not to OTP? Also, why didn't they put some Air Serbia stickers on it? It's like lot of marketing opportunity lost, if they're already leasing-out the plane.

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  14. My guess is, 4K will try to merge Nordica and Adria. Rumour has it, same people are advising both companies.

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