Tuesday, November 29, 2016

Government halts Croatia Airlines slot sale


Croatia Airlines' plans to sell its nine weekly slot pairs at London's Heathrow Airport have been put on indefinite hold after the government prohibited the move following talks with the carrier's CEO, Krešimir Kučko, last week. The Ministry for Sea, Transport and Infrastructure has also requested for the airline's management to draft a detailed report on the company's finances and future plans by December 15. Following an analysis of the results, a final decision will be made concerning the sale of the airline's departure and arrival times at one of the world's most congested airports. Earlier this month, Mr Kučko said Croatia Airlines would likely withdraw from Heathrow by the second half of 2017.

The Ministry for Sea, Transport and Infrastructure reportedly rejected Croatia Airlines' claims that the slot sale was part of the carrier's 2013 restructuring programme. Furthermore, it concluded that the decision to sell was made hastily without proper analysis. Recently, the Ministry noted, "It is important to avoid solutions that would provide only short-term benefits but could pose significant problems for Croatia Airlines in the near future". According to Mr Kučko, the carrier has generated a loss of 37.5 million euros on its Zagreb - Heathrow service over the past thirteen years despite a high average cabin occupancy rate, noting that the airline is unable to compete against British Airways on the route.

Last week, Croatia Airlines issued a statement arguing in favour of the slot sale and rebuffed criticism against its decision. "It is incorrect to say that the slots at Heathrow are extremely valuable and of strategic importance. In current market conditions, the slot sale would end the negative effects the route is generating on Croatia Airlines' entire business. Therefore, it is wrong to label the slot sale as a damaging decision or a national tragedy", the company said. Furthermore, the carrier rejected claims that by selling its five morning and four afternoon slots it would become less appealing to potential strategic partners. "Allegations that Croatia Airlines has no future and should be sold as soon as possible while it is still worth something are untrue and sensationalist. Croatia Airlines has been restructured and is profitable. Furthermore, it is growing through its own means and is securing Croatia's connectivity with other parts of the country and the world in a sustainable manner", the carrier added.

86 comments:

  1. Replies
    1. Wise desicion of the government

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  2. It looks to me like they will be getting rid of Kucko after 15 December.

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    1. I really hope so. OU needs a new management team that with a real vision and solution to its problems.

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    2. Let's hope they just don't put even bigger bafoons in charge.

      They really have to decide what kind of airline they want Croatia Airlines to be. Do they want to go ahead with opening bases in other countries, do they want to sell it and so on...

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    3. I agree. The management needs to be replaced ASAP.

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    4. Changing the management will not solve OU problems. They are simply unimportant player in the European aviation world with no real strategy nor potential.

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    5. Why is the mgt always the scapegoat in all these discussions ? Where is the accountability of the Board and the former Minister - both of which are ultimately responsible ?

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  3. Good. Some common sense.

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    1. It's still not a sure thing. On December 15 they could say that the government sees no other way and they approve the slot sale.

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  4. " Therefore, it is wrong to label the slot sale as a damaging decision or a national tragedy"

    Are they serious? Did Kicko write this himself?

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    1. Kucko is a one man show .Or you believe in what he says even though it's Bullshit, if you don't he will arrange away for you to get fired like many old employees can confirm.

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  5. Well after the government looking into the Airlines finance they will finally see that this Ceo has no knowledge in running a business. How can you have so big losses when the fuel has been so low.
    Congratulations to the this minister

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    1. I hope so and I hope they find someone competent to replace him.

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  6. I am "fascinated" (sarcasm) by OU's alleged losses on this route. LFs are good, prices seem not to be too low, so where's the problem ? Perhaps sales' channels ? To many fees by third-party re-sellers ? OU seems incompetent to manage digital campaigns given that often their Booking links open too slowly, thus lowering the user experience...it all affects direct sales.
    On the other hand, there is a possibility that sales results on this route are not as peachy as they may seem (good LF is not necessarily a proof of successful sales). I know for a fact that OU lacks human and technological resources in good Revenue Management Department, which is a prerequsite to quick sales tactics...(lowering or increasing prices depending on the availability).

    Anyhow, I wish OU luck. Hope to see a positive turnaround...

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    1. Sta te to cudi imaju problema sa placanjem poreza u Americi sto ne bi gubili na ruti do Londona. Zagreb je mali grad ciji ljudi slabo lete sa time se morate pomiriti nisu vam samo turisti dovoljni. Kada budete uveli LCC kompanije mozda i CTNu krene nabolje. Nis nije konkurencija Beogradu nece ni LCC da odnesu putnike CTN.

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    2. Alen Šćuric PurgerNovember 29, 2016 at 10:54 AM

      Na temelju čega zaključujete da iz Zagreba ljudi malo lete? Majko mila, odakle taj podatak. Zagreb u usporedbi sa Beogradom ima više putnika prema broju stanovnika. Konačno, ogroman postotak zagrebačkih putnika danas leti iz VIE, BUD, BTS, VCE, TRS, ZAD... Taj broj se smanjio dolaskom kompanija u prošlih dvije godine, ali je još uvijek velik i odličan je potencijal Zagreba.

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    3. Oduzmi silne strane goste koje ovde pominjes da dolaze u Zagreb iz daleka i videces koliko malo Purgera leti. Te price o silnim Purgerima koji lete iz ZAD ne pijemo cak i uz autoputeve.

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    4. I agree with @Anon 11:24. Purger is way too emotional about this subject.

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    5. Alen Šćuric PurgerNovember 29, 2016 at 9:03 PM

      Ne, Purger putuje jednom tjedno avionom. I puno previše puta iz drugih aerodroma. U posljednje vrijeme bitno više iz Zagreba i manje iz ovih drugih, ali još uvijek puno prečesto.

      Uz Purgera još mnogo purgerskih registracija ima po svim tim aerodromima (Venecija, Treviso, Trst, Beč, Bratislava, Budimpešta, Zadar, Graz, Ljubljana...). E sad, bit će da vi koji ste toliko udaljeni od Zagreba to daleko bolje znate.

      I da, mislim da sam sa svim svojim tekstovima stvarno pokazao koliko sam subjektivan. Svaka čast...

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    6. Ja uvijek putujem iz ZAG ili kroz ZAG kad krecem iz SPU.
      Jednom mjesecno u prosjeku......avioni su u pravilu popunjeni ovako:10% poslovni ljudi, 40% putnici namjernici s HR putovnicama, 20% ovakvi poput mene, pomorci ili ljudi zaposleni po naftnim platformama i ostatak sve ostalo

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  7. How can someone say that their company is "unable to compete against another company"? Is this a confession of how bad their product is, or that both companies are losing money on the route but the one with deeper pockets will survive?

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    1. Stupid remarks seems to be inherent for the entire region. I still remember when Jat's CEO (the one that now runs the airport) proudly told the media that he never flies Jat and uses Turkish Airlines instead lol.

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    2. Kucko also said that all their routes are unprofitable during the winter.

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    3. I also find that hard to believe.

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  8. I think the management was quite surprised at the outcry their decision to sell slots at LHR had. They wanted to do a behind the doors deal without anyone knowing. When it was released in one newspaper, OU management went crazy and were extremely angry that it was published. I'm glad it was as we would not have known about it before it was too late.

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    1. Imagine how many bad decisions they have made that we don't know about.

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    2. Alen Šćuric PurgerNovember 29, 2016 at 9:05 PM

      And several CTN employees take huge risk to give us those information.

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  9. So are they seriously buying regional jets and basing planes around the Balkans if they are selling slots?

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    1. I don't think that's on the cards anymore.

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    2. We are now at the end of November and there is still no news about their regional jet acquisition. So I think we will be seeing Fokkers next summer too.

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    3. They DO NOT have a strategy. Is that so difficult to understand?

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    4. yes they have. their strategy is to sit down and do nothing

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  10. Good news not to selll these slots which look like family silver. But I am asking myself ...WHAT'S NEXT? More or less where to get money to fullfil the financial gep? State as I know (and pls do correct me) is in more tide position as HR is a part of EU.

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    1. I agree. I don't know what more the airline can do.

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    2. Cur unprofitable routes, focus more on transfer passengers and the coast during the summer, start charter flights... There are many things they could do.

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    3. Looks like Adria case. To sell al assetts and than even give a mony to the buyer....just to get rid off it

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  11. They will go bankrupt if they don't come up with some actual strategy soon. Selling slots at LHR and engines just to achieve profitability is pathetic.

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  12. Does anyone know what are Croatia Airlines best performing routes in terms of LF?

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    1. I would assume Frankfurt.

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    2. Frankfurt, Amsterdam and Brussels. Always when I used to fly to these cities the LF was almost full.

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    3. Frankfurt, Paris, Amsterdam, London and Munich. Brussels, Vienna, Rome and Zurich are also good. All these destinations have 75% or higher lf, London is always 90-95%, Amsterdam 85-90%, Frankfurt too.

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  13. Ministri Marić i Butković na sastanku su se usprotivili argumentaciji predsjednika Uprave tvrtke da Croatia Airlines pozitivno posluje, a istovremeno prodaje svoju imovinu kako bi financirala servis avionskih motora. Također nije ni prihvaćen argument kako su slotovi izvanbilančna stavka te se njihovom prodajom zapravo podiže vrijednost kompanije.

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  14. Are there any candidates for the next CEO of Croatia Airlines?

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    1. Alen Šćuric PurgerNovember 29, 2016 at 10:58 AM

      Yes!

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    2. Can we know some? :)

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    3. Yes Purger could you give us some names please?

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    4. Misetic - an airline guy who knows how to run things. Plus, he is a HDZ insider

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    5. Alen Šćuric PurgerNovember 29, 2016 at 9:10 PM

      This last comment is not mine. You are pathetic to use my nick and try to be funny. Mode, please can you delete this last comment.

      I know 3 candidates, and I would not say 2 of those. But one I can say: Tonči Peović.

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    6. Purger - relax, stop being so sensitive - the post was made by anonymous - nowhere did it say or suggest that it was you - unless ofcourse you posted it only to create a false drama about it - just like you did when you released that information about Swiss flying to Nis...

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    7. Alen Šćuric PurgerNovember 29, 2016 at 10:30 PM

      Are you real?

      I really have so much time and so little years on my back to play as child 15 years old.

      O moj bože...

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    8. Even if they bring someone who is competent enough what can he do if OU is facing liquidity issues? Where will the airline get the money it needs?

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  15. This whole saga is taking a tragicomic turn.

    Kucko will just say to the government that unless they sell the slots they won't be able to show a profit. Given that the government can't provide them with a cash injection they might help in securing a loan. However, no bank would give a company like OU a loan without the government's. In other words if OU goes belly up it's the taxpayers that will have to foot the bill.

    Kucko will just blame everything on increased competition both in ZAG and at the coast and it will be business as usual.

    In the end, without fundamental changes and a drastic change in business mentality OU will keep on flying straight into bankruptcy. At this point I just don't see what can be done to save them, especially if they are experiencing issues with liquidity.

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    1. '...loan without the government's...'

      government's guarantees

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    2. I agree. What I am surprised at that absolutely no one was interested in buying OU. That's there only solution at the moment but no one wants them.

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    3. Even privatization is no guarantee for success, look at Adria or Air Berlin. Both airlines got privatized but a turnaround did not happen. It's highly likely both airlines will go under.

      OU needed an extremely competent management that could set up a business model where they could make the most of ZAG and the seasonal traffic on the coast. In my opinion this was impossible as long as they were a government owned airline.

      At the end of the day, if/when they go bankrupt someone else will step in to fill the void. That said, it will be interesting to see what happens to routes such as ZAG-SPU/DBV/OSI/PUY/SKP/SJJ...

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    4. Alen Šćuric PurgerNovember 29, 2016 at 9:14 PM

      In case Croatia goes bankrupt

      SKP - canceled
      SJJ - ?????? maybe with not more than 7 flights per week
      DBV - Trade Air or someone else, it is highly profitable
      SPU, PUY, ZAD, OSI - Trade Air or someone else if there will be PSO like now (it is 12,5 million EUR per year for 6.500 flights - everyone will fly for that money).

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    5. Will be interesting to see how Trade Air responds to OU's eventual bankruptcy. Maybe they could take over some of the planes, especially the Q400.

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  16. They have waisted to much time with this Ceo.
    And time isn't in their favour. I would say start firing unqualified staff including management and your losses will be much less .

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  17. As much as I don't like Kucko, I don't think that the guy running the ministry is competent enough to decide anything about Croatia Airlines' future either.

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  18. They are desperate for hard cash right away! If they don't sell these slots what will they do?

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    1. They still have planes they could sell and lease back. They also have the maintenance division. Unlike Adria, Croatia Airlines still has some assets.

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    2. As Adria years ago had it all now it has just a brand... I agree that Croatoa STILL DO HAVE....but time is ticking and they have to feed their pople. Do not belive that thay have any other scenario like Adria and many other which could be find only in Wiki as part of some nice days

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    3. Actually, if information is correct, Adria doesn't even own its brand anymore, but they are leasing it.

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    4. How does leasing your own brand work? Is this the crafty work of a shady investment group to avoid taxes or loses or whatever?

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  19. I'm happy the new government has finally stepped in.

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  20. OT
    Da li je neko upucen da li je JU poceo na odredjenim uglavnom star alliance destinacijama da naplacuje prtljag?
    Na nekim nemackim pretrazivacima mi izlazi niza cena za BEG-FRA-BEG ali uz napomenu da prtljag nije ukljucen dok na stranici Air Serbie stoji tarifa (istina malo skuplja) ali uz predati prtljag? Bilo bi dobro ako neko iz kompanije ovo cita da prokomentarise.
    Hvala

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    1. http://www.exyuaviation.com/2016/11/air-serbia-introduces-hand-baggage-only.html

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    2. Hvala na linku.
      Video sam taj clanak medjutim niti se na stranici JU navodi da postoji alternativa sa ili bez prtljaga niti kolika je razlika u ceni izmedju ove dve opcije

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    3. Razlog je zato sto nisu omogucili kupovinu ovih karata putem svog sajta vec samo putem drugih sajtova ili njihovog call centra i poslovnice.

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    4. I onda ti preko kol centra naplate taksu od €20 te ti izadje na isto :D

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  21. Jesus sweet Christ... at the rate at which we are going only JU and YM will be left in ex-YU!

    I don't think YM will ever die.

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    1. Wait till they enter EU.

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    2. That's what he said.

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  22. OT, this morning EY flight from Abu Dhabi to Belgrade Aribus A320 lf 100%, lots of transfers.

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    1. Any idea to where?

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    2. Probably to Croatia and Bulgaria

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  23. OT

    Saw today ASL A319 at SJJ, YUAPG metal. Long line at business check-in desk. Pretty decent number of pax at the gate. Was pretty surprised.

    Could be that they took over LH passengers, since OS to VIE was packed as well.

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    1. Just a small correction, YU-APG is an A320. :)

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    2. Just to add, a friend of mine flew from BNX to BEG the other day and he said that the flight was full. Loads have certainly picked up. It's great that they are keeping the fares affordable.

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    3. Not that affordable anymore! About eur 95,-- return, used to be around 55,--.

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    4. If true then it's a shame, 95 is a rip off for such a short flight. He paid €70 which is ok. In my opinion all regional flights should not be over 100 with oil being so cheap.

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    5. If JU can charge 95€ for BEG-BNX and carry full planes, then they absolutely should.

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  24. Thank god they've stopped this insanity. Hope they remove that aparatchik from the pos

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