Peaceful parting

Government to approve Turkish exit

The Federation government of Bosnia and Herzegovina is set to approve Turkish Airlines’ exit from its 49% stake in the Bosnian national carrier, B&H Airlines, this week and take over all of the airline’s shares. The government is looking to make the “divorce” between B&H and Turkish Airlines as painless as possible so as not to have an impact on passengers or the carrier’s employees, which have been caught in the middle of the spat that has lasted for half a year between the two sides. Up for discussion will be code share agreements between the two carriers as well as other arrangements the two companies had over the past four years such as staff sharing at foreign airports.

The main objective of the newly appointed management at B&H Airlines will be to boost passenger numbers and revenues while at the same time decrease costs. For the time being, the airline will have to do so with a single aircraft. In the first quarter passenger numbers decreased 43%. The government will also have to decide whether it will try to find a new partner for the carrier. However, such a move is unlikely to come immediately, despite informal talks with potential investors. The Bosnian government has ruled out any possibility for it to become a minority stake holder in the company, meaning it will hold on to its 51% share in any future arrangement.

In late 2008, Turkish Airlines took over a 49% share in B&H. By May 2010 it provided the airline its first jet engine aircraft, a Boeing 737-400, allowing it to launch flights to Vienna, Prague, Berlin, Copenhagen, Stockholm, Gothenburg and Dusseldorf. However, this hasty expansion led to the termination of flights to Prague and Berlin due to poor interest. Similarly, newly introduced flights to Podgorica were also cancelled. In 2010 the B737-400 was replaced with an Airbus A319. The airline continued to expand with new flights to Amsterdam, Belgrade and Zagreb, with the latter two cancelled shortly after. In 2011, the airline cancelled its flights to Vienna, Dusseldorf, Stockholm and Gothenburg. The relationship between Turkish Airlines and the Bosnian government deteriorated after the New Year with the A319 taken back by Turkish Airlines leading to the suspension of its popular Amsterdam flights and the grounding of an ATR72. Now, a new chapter begins for B&H Airlines.