Adria to maintain cost cutting measures

Adria Airways will continue to cut costs in an attempt to retain profitability achieved in 2016 following several years of losses. The airline's CEO, Holger Kowarsch, told "ATW Magazine" recently, "There is never an end to adjusting and cutting costs. When you stop doing this, you start losing immediately. First we thought it would be more complicated to restructure a former state-owned company, but our employees were motivated to bring the airline forward". Mr Kowarsch added that the carrier is clearly improving its financial performance, but declined to give details. Furthermore, the CEO noted that Adria’s membership in Star Alliance is of great importance to the airline, giving it the ability to turn Ljubljana into a key player in the Balkan region by positioning the city into a transfer hub and streamlining other costs and services with partner airlines.

Adria is yet to publish its financial results for last year. It posted a net profit of 3.2 million euros in 2016, making it the most profitable national carrier in the former Yugoslavia. It came within a year of the airline's takeover by investment fund 4K Invest and represented the company's best result since Adria made its first profit in 1997. However, the way in which it achieved profitability has been debated, with revenue streaming in from the sale of two Bombardier CRJ200 aircraft, as well as the sale of the "Adria Airways" brand name to nonother than 4K Invest. The airline has so far remained tight-lipped on its financial performance for last year.

Adria's former management was the first in the former Yugoslavia to launch wide-ranging cost cutting measures by transforming the airline into a hybrid low cost - full service carrier in 2014 by charging economy class passengers for food and beverages. This was followed with the introduction of low cost car park options at Ljubljana Airport, as well as a new approach to online sales including first-minute and last-minute fares. Following the airline's takeover, Adria introduced "hand-baggage only" fares, charging passengers fifteen euros per every checked-in item with the aim of reducing ticket prices. However, the airline has also relaxed some of its policies in the past few years, with the carrier no longer charging economy class passengers for water and has rolled out a free of charge in-flight entertainment platform which can be streamed to passengers' laptops, tablets, mobile phones and other hand-held devices. Adria's former CEO, Arno Schuster, who stepped down from his post in February, recently said, "We invest a lot in order to meet the needs of our passengers and want to offer the best possible fares to all our travellers. The future of Adria is not in the low cost model, since we are members of Star Alliance, which has high standards. The alliance enables Adria to improve its connectivity, lower its prices and gain more visibility".