Air Serbia plans to retain its four-member Airbus A330 fleet in the short term, including the aircraft registered YU-ARC, whose lease expires late next year but will be extended. Speaking to EX-YU Aviation news, Air Serbia’s CEO, Jiri Marek, said, “We are in the process of extending the lease because, whatever options we evaluate, extending it remains the most economically viable choice”. He added, “We are currently in discussions with Safran, which has made us an offer to produce the spare interior parts we want to upgrade. We will not undertake a full cabin retrofit, as it is not economically viable and we would not get a return on that investment.”
Commenting further on the decision, Mr Marek said, “When you operate a four-aircraft wide-body fleet, any issue, like the recent damage we experienced [caused by a ground handling vehicle], can very quickly erode your profitability. That was also a factor in our decision to keep the aircraft. We have very favourable lease terms and retaining it gives us the flexibility to use it as a spare opportunistically, like with Toronto. On paper, the business case is there, but the real outcome becomes clear only once you start flying. If it performs well, then you have a proven case to justify looking at additional long-haul aircraft”.
He added that committing to a new wide-body purely to test a market would be financially reckless. “If you need to take a long-haul aircraft to verify whether your business case is solid or not, and you’re locking yourself into an eight-year lease, that’s a very risky decision”, Mr Marek noted. He added, “That is actually why it took us so long to decide on Chicago or any second long-haul destination, because it required a second aircraft”. One of the airline’s four A330s are currently undergoing scheduled maintenance with another to follow next month. “This year we were very lucky we had a spare, because we had two instances of ground vehicles damaging the aircraft all while supply chain challenges continue”, Mr Marek concluded.
So YU-ARC is here to stay
ReplyDelete😠
DeleteSo basically no retrofit, no new aircraft and wait to see what happens.
ReplyDeleteTo be frank, I didn't understand him at all
Delete+1
DeleteNo word on standardizing the cabins of the longhawl fleet either. 😢
Well they are obviously not going to do that. He explicitly says there will be no cabin retrofit.
DeleteAgreed, not a clear message at all.
Delete9:11 no, he said no full cabin retrofit. That opens a question if partial or no retrofit at all?
Delete@09:14
DeleteAnd when is also important.
^ you need to read again. He says that Safran will fix things that are not working but they will not retrofit the cabin.
DeleteThey should have gotten Safran to fix things that are not working on Pupin years ago.
DeleteIt would be stupid to do on a plane you are returning to lesor. But now we know it stays, hopefully to do it as soon as possible
DeleteIf the product isn’t upgraded, Air Serbia risks falling behind
ReplyDeleteEspecially on Yu-ARC
DeleteThey seem to be laser focused on the lowest lease cost possible. But not on the cost on the airline's image and market perception of flying aircraft in such a poor cabin state.
DeleteFall behind whom? As long as planes actually took off and land, and you don't get tetanus from the seats, I don't see much competition.
Delete+1
Delete@09:29
DeleteThat is a sub-Saharan Africa airline business "strategy".
@09:29 competition from other arlines under cutting JU with far nicer aircraft to boot.
DeleteStill a long way until this country becomes a medium/high income society or important tourist mecca, until then most of local pax carefully book tickets in advance and don't mind quality that much.
DeleteIt seems that only this business model in Balkans could drive profit for them, there's no money from the state anymore. And I don't want to defend JU, many things are clearly out of place, but cutting costs is still the prevailing factor for their operational and financial stability.
Well it`s been medium income society for ages, and Belgrade itself is certainly a high income one, and there their hub is.
DeleteAnd buying long in advance does only Baznian Canadians in times of 35th year of Internet.
DeleteHow long are they planning to keep those old cabins? Economy's IFE is so outdated..
ReplyDeleteInstalling WiFi would greatly improve things since most pax prefer to browse while flying.
DeleteEspecially those flying business.
That is actually not true. They did the testing and over 60% of people do not even attempt to connect to wifi. Passengers in bussines class mostly eat and sleep, they got those seats flat beds seats to get some rest, and not to brows.
DeleteAnon 10:10 what is your source? Aviation week and space tech source says: Wi-Fi Usage & Desire
Delete1. High interest in connecting:
• A large majority of passengers say they would use Wi-Fi if it’s available — one industry survey found 81% would use the airline’s Wi-Fi when offered. 
2. Actual usage when available:
• Among passengers who had access to in-flight Wi-Fi in the past year, ~65% actually used it during their flight. 
(This is one of the few direct figures available on usage rather than just interest.)
3. Demand on long haul:
• On long-haul flights (>6 hours), 90% of passengers think being able to connect to Wi-Fi is important, and 83% believe it should be free. 
• Around 62% of passengers overall say they would connect to Wi-Fi to pass the time — outpacing other common onboard activities. 
The airline's CEO has said that wifi usage on Air Serbia flights was 1% across all flights. There was no point in keeping the service.
DeleteWell, that was couple of years ago (don't remember when was it discontinued).
DeleteIt's not carved in stone, habits are changing constantly.
I dont understand how they keep talking about proper planning and spare capacity while at the same time they had to cancel all flights to China for two weeks for the lack of spare capacity
ReplyDeleteThey shouldn't have scheduled two aircraft receiving c-checks at the same time. What is the route planning department supposed to do with half the longhaul aircraft unavailable?
Delete+1
DeleteC checks are mandatory and must be performed within defined limits. They are triggered by a combination of time and aircraft usage. The state of the market is such that you can't pick and choose when you are going to send the aircraft for maintenance. You send it when you can get available slots.
DeleteMy thoughts also, but there are Hainan and China Southern to collect pax. At least it will be an upgrade regarding on board service.
DeleteWhen they had similar issues before, they were leasing out Wamos planes to cover for them. Obviously they are not planning to do that now.
DeleteIt seems that Air Serbia is so focused on short term profitability that they completely disregard long-term client relationship, brand imagery and its reputation in general.
You would have complained as well if they wet leased a plane writing the same reasons.
DeleteAnonymous 09:25
Delete+100% correct!
@09:30
DeleteDo not attack people for stating the obvious. The airline should have scheduled its maintenance better and also not announce the cancelations less than a month before they happen.
I am not attacking anyone. It is without doubt that he would have complained regardless. I'm not going to respond to your "scheduling" because it is apparent you do not understand neither the state of the industry or how maintenance works, especially at the moment.
DeleteDoubling down only makes the things you write even sadder.
DeleteHow do you know who that particular anonymous is? And how come all other European airlines do not have to ground half their transatlantic fleet at the same time?
The airline knew far before late December when the A330s need c-checks. It should have planned accordingly and give pax notice much earlier.
DeleteMany airlines are having serious issues with maintenance and many airline's are voicing their dissatisfaction with it. But you have to be more interested in aviation other than route announcements and cabin upgrades to know that. Most airlines with long-haul operations have more than four aircraft in their fleet, so it is less visible when aircraft are out of service.
DeleteNo other airline schedules maintenance that grounds half its fleet. JU knowing they have 4 A330 should have been planning accordingly.
DeleteYes, like I mentioned it is apparent you do not understand neither the state of the industry or how maintenance works, especially at the moment.
DeleteHow yes no! Vamos is keeping its plane on the ground, waiting for JU to need it. And the price of one Vamos turnaround is 100k, almost half of the monthly price of ARD/ARE. So it is a lot cheaper to reroute few dozens of pax then rent a plane. Surely not too many tickets are sold up front
DeleteShort term or urgent wet leases are not supposed to bring the profit to the company anyway.
DeleteAs I understand:
ReplyDelete1. There will be no long haul expansion for some time
2. Consequently, no new wide bodies
3. YU-ARC lease is for peanuts otherwise it would go to scrap
4. Passengers? Who cares passengers.
+1000
DeleteLong haul expansion can still happen because the fleet is underutilized. I'm convinced that in 2027 a new route will be introduced.
DeleteLong haul expansion is happening. They are launching Toronto in 2026. That is the fourth consecutive year that a new long haul route has been added.
DeleteSo no MIA this year? That is sad.
ReplyDeleteYes, it is very sad that next year you get a third new long haul route in 2 years. Horror.
DeleteAir Serbia isn’t ready for aggressive long-haul expansion yet, and that’s probably a good thing.
DeleteCan guarantee 90% of people in the comments who seem upset (for whatever reason) have not flown Air Serbia long haul ever.
ReplyDeleteThey are upset because they want to fly Qatar Airways quality with dirt cheap prices.
DeleteSome people are upset at everything. You had people who were angry and upset when they announced Tromso as a new route the other day.
DeleteI flew 10 times to both US and China this year with JU and Im upset that our national airline is showing complete disregard for the state of the planes and its long-haul service. Their attitude towards passengers is that is enough that these routes exist, regardless of the state of their planes. I love flying JU on their short-haul fleet; in particular, I love new ATRs. However, flying JU long-haul is such a high-risk undertaking that it completely justifies the frustration people are showing in the comment section. Last week they delayed PVG for 48 hrs, with some of my business partners being late for the conference. No apology from JU, no reimbursement, no nothing.
DeleteI am sure JU people are reading this. You need to understand that the vast majority of people here on this forum are JU fans, and want the company to succeed and florish. At the same time, we are going to be equally pissed when you show such low levels of respect to people who buy your tickets, essentially covering your salaries and funding the company.
Anon 10:06
DeleteAbsolutely right!
You definitely did not fly longhaul on JU or any other airlines. I fly regularly on LOT and lufthansa and it is just terrible service and the comfort in the economy class. In August, I have flown to JFK with JU on the expo tail and I guarantee you it was 10 times better : better comfort crew was awesome and food was actually tasty in both directions. People on here that are commenting on long haul products probably never been on those jets, however they might have taken BEG TIV flights.
DeleteThey are upset since their zama Air Serbia doom and gloom theories remain theories. They are upset about JU short and long haul expansion. They are upset about new planes and new pilots. They are upset about success. They are upset and will remain upset.
Delete@anon 12:44
DeleteIt's not that simple. Don't get me wrong, I like JU, fly with JU and proud of what they are achieved. But there are many areas to improve service. We talked the other day on YU-APS. How hard and expensive is to take some "крпе и рукавице" and at least clean the plastics on the seats? I know a couple of avgeek kids who will do it for free, just to spend afternoon at airport and in the plain.
@12:44 Exactly!!! Only zamaanalyst and his disciples are upset. With 5 long-haul destinations, over 30 planes in fleet, steady profitability and record number of JU passengers of all time, that aviation cult lost not one battle, they lost all battles and the war itself. Air Serbia won.
DeleteI have another idea to propose. Start flying to LAX, not as a non-stop but as a direct flight via CHI (without 5th freedom right). LAX also has potential.
ReplyDeleteLAX doesn't need stopover with A330/200. Just need demand
DeleteIt can not fly with full load of passengers and cargo and they most certainly won't be launching LAX or anything else in the US other than Miami like they've said multiple times.
Delete“No full cabin retrofit” basically means passengers are stuck with a tired product for years. Economically viable or not, the onboard experience matters on long-haul routes.
ReplyDeleteWho remembers proper cutlery in Y seats with the menu handed over during boarding?
ReplyDeleteAnd who remembers JAT B737s
Sadly, this is the curve AS is taking...
The metal cutlery and proper menus in economy were unsustainable for the market. That's why the airline was bleeding cash and needed to completely change its business model in 2017. At the same time, back then it was serving 45 destinations now it is serving over 90.
DeleteThe concept of having tired equipment and mediocre soft product will place AS in line with the rest of the region which was rightly pointed out by someone else here. Nothing to be proud of, but thats OK LOL.
DeleteWith the rest of the region? Rest of the region doesn't have nonstop flights to Tbilisi, Chicago and Shanghai among many others. Direct flights lift Air Serbia way above the rest of the region
DeleteHere we come to discussion about quantity vs quality.
Delete(and its not all about size)
I do not agree with many things but the management's comments show a level of financial discipline rarely seen in this region. Better slow and stable than fast and bankrupt.
ReplyDeleteExtending YU-ARC makes sense but what’s the long-term plan?
ReplyDeleteI wonder how long the lease is being extended for
DeleteTwo aircraft damaged by ground vehicles in one year?
ReplyDeleteHappening more and more across Europe and the US unfortunately.
DeleteHow come
DeleteFlew on Pupin to JFK last year and the dude next to me had a missing recliner button on his seat.
ReplyDeleteI understand the need to be fiscally responsible, but given their long haul expansion, JU will have to start thinking about being competitive sooner or later, and having a consistent and at the very least acceptable hard product is pivotal in doing so.
Btw, has anyone else had any similar experiences when they flew on Pupin?
https://www.exyuaviation.com/2024/10/trip-report-air-serbia-belgrade.html
DeleteThe text says that Safran has made an offer to fix things that are not working in the cabin.