Friday, June 24, 2016

The road ahead for EX-YU airlines


Halfway through the year, there have been some significant developments for the national carriers from the former Yugoslavia. Adria Airways has been fully privatised, Air Serbia launched transatlantic flights, Croatia Airlines completed its restructuring process and the depth of Montenegro Airlines' financial issues have been made public. We now look forward to the rest of the year and what lies in store for the four carriers.

Adria Airways' upcoming winter operations will mark its first full season under new management. The German turnaround fund, 4K Invest, which now owns a 100% stake in the company, has been swift in terminating unprofitable routes and reducing the workforce. So far this year, the airline has suspended flights from Ljubljana to Istanbul and Stockholm and from Tirana to Brussels and Paris. The carrier has already announced plans to terminate flights from Ljubljana to Berlin this winter and turn it into a summer-only destination. On the other hand, Adria has confirmed it will boost frequencies on flights to Warsaw, despite competition from LOT, as well as on the recently launched Pristina - London and Olsztyn - Munich routes. Furthermore, it will add additional departures from Lodz to Paris. The Slovenian carrier also plans to conclude codeshare agreements with Sky Team-members Air France and KLM, on its flights to Paris and Amsterdam. In addition, it will continue its cooperation with the Estonian national carrier Nordica, which uses Adria's Air Operators Certificate (AOC), for at least another year, after which the two will broaden their partnership.

Following the successful launch of Air Serbia's first transatlantic service, all eyes will be on the route's performance in the coming months. The company's Chairman, Siniša Mali, has noted that introducing long haul services naturally leads to the addition of other far-away destinations. "Other cities in the United States and Canada are of interest but we are also looking at some other places", Mr Mali said on Wednesday. However, he refused to give any firm time-frame as to when new long haul flights could be introduced, saying only that the airline will first focus on its New York route. New transcontinental services would require additional wide body aircraft. Meanwhile. both Air Serbia and Etihad Airways will strengthen their partnership. Air Serbia's CEO, Dane Kondić, has confirmed that the airline will open a new call centre in Belgrade this October catering for all companies which from part of the Etihad Airways equity alliance. Furthermore, the Serbian carrier is in the process of overhauling its catering facilities, while Etihad Aviation Group CEO, James Hogan, said other forms of cooperation are currently being discussed.

The successful completion of Croatia Airlines' restructuring process has allowed the carrier to open new routes, all of which will be maintained only during the summer. Despite plans to privatise the carrier, the recent collapse of the Croatian government will delay the process even further. Fresh elections are not expected for at least another four months. As a result, the airline will continue with its current strategy. During the coming winter it will prepare for the establishment of new bases in Sarajevo, Pristina, Skopje and Tirana and should finalise an order for new regional jets. While the carrier says it is in discussion with all plane manufacturers, it is believed to be leaning towards Bombardier jet-engine aircraft. Furthermore, the Croatian carrier is preparing for its shift to Zagreb Airport's new terminal building, which opens next March. The airline has hired additional staff to help with the transition.

Montenegro Airlines' financial issues have come to a head. Over the past few months there have been warnings of industrial action from staff, the company's management board has been reshuffled yet again and a new Finance Minister has threatened to cut off funding. The company will now create a new restructuring plan which should be based on realistic indicators, in order to offer its founder, the government, a viable model of governance that will fully justify its existence. Although slated for privatisation this year, this is unlikely to happen. While there has been interest from several companies for the acquisition of Montenegro Airlines, it has so far been insufficient to warrant the start of tender procedures. Under a commercial cooperation agreement with Etihad, which is under investigation for unknown reasons, the Montenegrin carrier is looking to improve and rationalise its operations during the winter. As a result, it plans to lease out some of its aircraft.

78 comments:

  1. It will certainly be interesting. From those plans reported here, it looks like Adria is drifting more and more away from Ljubljana which is a surprise because I thought with LJU being Fraport owned and JP also German owned the relationship would improve.

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    1. Since they were purchased I no longer consider them my national airline. They will probably fire the majority of Slovenes anyway and get cheaper labor from Kosovo and Poland.

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    2. Don't know who will fly with them from places like Pristina either with these fares.

      https://pbs.twimg.com/media/ClaJGnoWIAAbic-.jpg

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    3. My guess is, Adria will become part of Nordica (or vice versa).

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    4. Well they did say they wanted to be a pan European airline, not just Slovenian.

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    5. Slovenian market is soooo small and Europe offers so many opportunities...why not just to jump out of the box? Our framed minds are stil on the national levels...too bad

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  2. I don't think we will see the addition long haul flights from Air Serbia until next summer season. Then I think we might see Beijing, rather than more north America flights.

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    1. Interesting how Mali backtracked. In February he was announcing how he is going to Abu Dhabi to negotiate a second A330.

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    2. Just wait a bit ;)

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    3. He didn't backtrack. A second A330 is being negotiated. Such acquisitions don't occur overnight. There's an offer of intent, at the moment.

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    4. I see YYZ as the most viable potential new long haul destination.

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    5. JU needs a partner in the USA, quickly, and given Etihad's special relationship with AA, it would make sense to hope for some kind of code share or at least interline with AA. If that happens, then clearly ORD would make more sense than YYZ. With ORD/JFK + AA, JU could offer the most convenient one-stop solution for all of US -> Serbia traffic.

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  3. It looks like Kucko will overtake Misetic as the longest service Croatia Airlines CEO the way things are going now.

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    1. How long has he been CEO?

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    2. It will be 4 years in September so it's not a long time. But the board is chosen each 4 years. I don't know if the change in government will prologue this now.

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  4. I think Montenegro Airlines will go bankrupt.

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    1. Won't happen. Won't be allowed. I think we will see some fusion of Air Serbia and Montenegro Airlines next year. We will see.

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    2. Why would they take on such a burden?

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    3. No fusion with Montenegro Airlines please!
      Air Serbia has to be profitable and only can achieve this with a single structure and hub.
      But i see no problem with leasing aircraft from and codesharing with them.

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    4. Etihad also takes on burdens. I think the idea is for Montenegrin govt to write off all debt. You will increase traffic flow on JU flights and increase revenue that way too.

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  5. OT: regarding vintage photo, YU-AMB (one on photo) was Edvard Rusjan, while YU-AMA was Nikola Tesla

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    1. Thats right, photo is showing Mike Bravo, not Mike Alpha

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  6. Sorry but the only two airlines I see with some prospects are Air Serbia and Croatia Airlines.

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    1. I agree too. Air Serbia for the fact that it has strong backing from Etihad and the state in its business plans and a relatively professional management which makes good decisions. Croatia Airlines because it has a good market with a lot of potential, little of which it has actually used.

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    2. I think Adria will survive. Probably not as an honest flag carrier for Slovenia, but it will stay around.

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  7. Adria adding frequencies from secondary hubs will mean reducing from Ljubljana. Great -.- Air Serbia launches flights to New York we launch flights from Olszityn or whatever it is called.

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    1. JP also increases flts to ZRH during Winter. Last Winter 13 flights, this WITT 16 flts. In addition WAW also more flights comparing to actual TT. So not everything is being reduced....

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    2. Does anyone know what is being reduced?

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    3. Flights in WITT per week

      VIE 12
      FRA 20
      MUC 14
      ZRH 16
      BRU 12
      WAW 5
      AMS 5
      CPH 2
      TXL 0
      PRG 3
      TIA 7
      PRN 6
      SKP 7
      TGD 3
      SJJ 3
      SVO 6

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    4. Thanks for that. Not a lot of changes. The TXL suspension is made up for with a few increases here and there.

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    5. Where's Paris? I thought they were doing well on that route.

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  8. Adria is the only carrier in this teagion that has to obey matket rouls by all means...no subvensions, no subsidies, no protection ..no nothing - pure market. Pls do not be ao arrogant over Adria. Who knows when other carriers should go the same way

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    1. Really? They got 80 million euros as bailout money from the government, the state owned airport bought their technical division....

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    2. It was as amy of all exyu ones...but not any more. It has to get its own money to surrvive

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    3. Agree! Adria depends on its own now

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  9. Ima li neko slike sletanja leta iz Njujorka?

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  10. Anyone have some more info on Croatia Airlines' fleet plans? Thanks.

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    1. Apparently CRJ900

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    2. Didn't people talk here about C-series... Would be cool.

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    3. Because I don't believe Mr Kucko anymore, more likely AVRO RJ-100.

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    4. @AnonymousJune 24, 2016 at 11:18 AM

      It'll be CS 100, negotiations are ongoing for 4 aircraft, price is well bellow marketed price. CS100 marketed price is $63 million, OU will most likely pay $50 million per jet.

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  11. Well I hope they could all develop but the market is too small. And then we have plans to resurrect B&H Airlines...

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    1. Turkish and Etihad are interested in doing something with Bih market. We will see.

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  12. With Air Serbia going overseas and introducing another 4 destinations in Europe it has really gone ahead of the ex-Yu pack. I don't think they should consider any airline acquisitions (which would only happen with Etihad support anyway). Grow your own business. There is still a lot of work to do.

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    1. I agree. Air Serbia is the leading airline in ex-yu without doubt.

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    2. How about AirSerbia buying Adria and use them as a feeder on regional routs, to boost frequency on established routes and as a charter brand? CRJ900 seems to be a good aircraft to open a new routes.

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  13. Anyone knows why JU 500 is delayed by 2 hours today?

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    1. tehnicki razlozi...

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    2. Probably a slot issue.

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    3. Or the a330 went tech? More likely...

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    4. So it went tech and then it missed the slot?

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    5. Finally departed at 15.30.

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    6. I just checked and it lands 4 minutes after it is supposed to leave for Belgrade. Also tomorrow there is a short turnaround so let's hope they manage somehow to arrange it all or for EY maybe to send an A345 to reduce the delay.

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    7. I hope some heads will roll because of this! Dane must fire the responsible people.

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    8. There is no way YU-ARA can make it back to BEG on time for tomorrow's flight so they will probably end up with another 2-hour delay. After that an idle day comes so they can have a fresh start on Monday. I don't think they will be pulling out that A345 from AUH just to save two hours on one single day.

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    9. Not a good way to start a new venture.

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    10. Every beginning is hard. What matters is to learn from mistakes and not repeat them.

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    11. Last anon,

      Do you think they will learn from this? I sure hope so.

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    12. The real reason why some heads should fly is that no one noticed the issue during 7 hours while the a/c was sitting at BEG. It means the post flight inspection - the plane flew nearly 20 hours continuously - wasn't done properly.

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    13. Anon 6:02,

      Of course they will learn. They had similar issues back in 2013 and they resolved them thanks to the learning curve. Same will happen now.

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    14. But now when there is an issue with an Atr o Airbus they send Aviolet, they can't do that with JFK

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    15. Well, why not ?! That would be a sight.

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    16. Via Iceland lol.

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  14. Nadam se da ce 2 A330 da leti YYZ i PEK .
    I da ce se uvesto jos neke feed linije po Evropi.
    INN-NS

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  15. O cemu vi raspravljate o malim bezveznim kompanijama dok je u vazduhu sudbina RA i EasyJeta na ovim prostorima. Da li ce ipak Wizz preziveti?

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  16. OT: If someone from the US is interested in winning 2 business class tickets: JFK-BEG-JFK with Air Serbia: http://viewfromthewing.boardingarea.com/2016/06/23/giveaway-2-business-class-tickets-celebrating-air-serbias-launch-new-york-jfk/

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  17. OT: JU cabin crew in JFK airport: https://www.instagram.com/p/BHAVAEJxf-E/

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  18. JU500 has been given a spectacular approach over Manhattan, La Guardia, Long Beach and the bay, looks like Canarsie approach, love it!

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  19. Haha...you too ?!
    Also watched the landing on flightradar24 live.Over Harlem into Queens - south of La Guardia.Then a turn to the atlantic and to Sandy Hook NJ and then touchdown.
    simply amazing!
    One and half hour late,well it was not so bad.the pilot saved a whole hour.
    Applauze !

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  20. After just 2 days of operations, we get a C class report on JU route JFK-BEG. The author had mixed feelings (more on the bad side) it seems on this flight, but said will make final impression on the return flight.

    http://www.airliners.net/forum/viewtopic.php?f=9&t=1336207

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    1. Thanks for sharing this. A quite detailed trip report. Seems like there is plenty of room for improvements which is not surprising for this new type of service.

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    2. The guy is clearly an expert flyer and a tough customer! If you can please such guest you know you do a good job - that is why I like such reviews. I hope ASL would consider this type of feedback as well for their service quality.

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    3. The man is obviously a hater or an ex-Jat employee.

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    4. Дечко ТзарJune 25, 2016 at 5:38 PM

      Adrian Leung is well known for his inaugural flight reviews, so kudos for being first! He strictly follows the script and sometimes can't distinguish irrelevant from relevant components of the offering. Frequent business class travelers generally discard amenity kits and airline provided headphones for their own, but comfort and service do matter to them so you can’t assign the same scoring relevance to all categories.

      However I strongly agree with Adrian on dated herringbone config as I already mentioned before, this was just a relatively low level investment to refurbish old Jet cabin. I will hold off my comments on food and other components until I actually fly the route.

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    5. That guy seemed disgusted already before entering the plane.
      The only remark i cared for was that he said the flight was jam-packed.
      A half empty flight would be really a concern.

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