“Jat Airways facing biggest crisis in history”

Jat Airways, Serbia’s national airline which is currently on sale has found itself in a financial crisis as airlines around Europe go bankrupt on a daily basis with XL and most probably Alitalia becoming the latest victims. Jat Airways CEO Saša Vlaisavljević has outlined the new cost cutting measures stating that the airline is facing “the biggest crisis in its 81 year history” and is asking the government for help. The new cost cutting measures are outlined below:

EMPLOYEES: More than half of Jat’s employees working in the airline’s offices outside the country have been returned back to the airline’s headquarters in Belgrade. Many offices have been closed with official Jat ticketing agents only staying open only at airports. Jat has a unique network of worldwide offices including Toronto, New York, Chicago, Beijing and Sydney. The office in Dubai recently closed its doors and all sales have been left to Jat’s station manager at the airport. Employees got even worse news today when it was announced that 800 people will lose their jobs which would bring Jat down to 1.000 employees. On top of this employees, including the airline’s CEO and directors will get a 15% pay cut starting October.
FLEET: From October 25, 2008 (when the winter season begins) Jat will ground many of its aircraft in order to reduce costs. Jat will operate with a fleet of 9 aircraft – 6 Boeing 737-300’s and 3 ATR72’s. Jat currently operates with a fleet of 16 aircraft (10 B737-300’s, 5 ATR-72’s and 1 B737-400).

CATERING: Even the airline’s Jat Catering agency will not be speared. Catearing will be reduced by more than 50% meaning that there will be less food and beverages (which are for now still all free of charge) offered on flights. Jat’s CEO is asking for understanding from passengers.

PRIVATISATION: Adding to the crisis is practically no interest in the purchase of the company. The Serbian Privatisation Agency will, in late September, release the list of airlines interested in purchasing Jat while an opportunity for companies to make offers for the purchase of the airline will end in mid October. Reports suggest there have been no offers sent in signalling a failure for the privatisation.

Jat Airways managed to survive the 1990’s when all international services were cut, plenty of aircraft sold and thousands of staff fired as the UN imposed sanctions and war broke out across the Yugoslavia. It even survived the 1999, 78 day, bombing of its country and hub. Will the airline survive the 2009 global economic crisis remains to be seen. The signs for now are not pointing in a positive direction.

Note: Soon the blog will publish Jat’s new winter schedule and all the changes that will come with it. This will be followed by all the other national airlines from the EX-YU region.