NEWS FLASH
Swiss International Air Lines will completely discontinue flights between Zurich and Niš following the Christmas and New Year holiday period. Initially, the airline downgraded services between the two cities from year-round to seasonal operations but has since dropped the flights altogether. Swiss cited growing competition, demand and route development potential as the reasons behind the termination. As a result, Swiss will maintain two weekly services between the two cities until November 29, after which it will operate again from December 20, 2019 until January 12, 2020.
Swiss failing in ExYu, nothing new.
ReplyDeleteIt's not failing, passengers from remote areas in ExYu simply don't fit into their business concept.
DeleteSJJ, ZAG, TGD, SKP...are not remote areas of ex YU
DeleteYeah, let's ignore the elephant in the room.
DeleteSo how are the other routes going to perform now with the fixed costs being distributed on the remaining routes. The pressure will mount and gradually all routes will become negative, if they were to be profitable ever.
DeleteNo it won't, all other routes have fixed expenses that are already paid for by the government. Suspension of BUD actually reduces the overall expenses.
DeleteReally? I thought that utilisation of the Aircraft is crucial in making Money. But since JU owns their own Aircraft which are all Paid off and Crews are Paid only when they actually fly you might be Right. Then the Costs will go down with BUD being terminted as the Crew wont be Paid.
DeleteWe are talking about a two weekly, short rotation at the end of the day. They save more by not flying at all than by flying empty to Budapest. You conveniently forgot to add that like this they don't pay for fuel, overflight costs, airport fees ...
DeleteOnly BEG survives.
ReplyDeleteWell with the biggest diaspora in Switzerland no wonder.
DeleteAnd PRN, of course.
DeletePSO reaping rewards left right and center.
ReplyDeleteThe gift that just keeps on giving.
Delete+1
DeleteGovernments goal was achieved. Minimise competition to JU.
True, that's why they banned FR from MLA or W6 from MMX. :(
DeleteThey weren't quick (or brave) enough for those. The salvaged what they could.
DeleteOf course, poor little corporations. :(
DeleteГенијалан маркетиншки потез.
ReplyDeleteexpected
ReplyDeleteSo Tivat, Budapest and Zürich gone already. Expected.
ReplyDeleteWhich one's the next to be cut? How quickly will they go public that 5 mil/year are not enough for 11 destinations?
DeleteIf the routes are not profitable, they should cut them. There is absolutely nothing wrong or unusual with closing routes, especially in such small cities.
DeleteTivat want cut, it was seasonal from the start. It's coming back next year. ZRH was killed by FDH, too much capacity.
DeleteThere's absolutely everything wrong with closing routes if you're being paid 5 mil / year to serve them and deny others from qualifying for it or starting the routes themselves.
DeleteFailure to serve committed destinations is normally tied to penalties in PSOs. Let me guess - not in this case?
Only BUD was terminated that was PSO. W6 is free to step in ;)
DeleteOnly BUD *so far*.
DeleteRyan is free to start Budapest, if they want :) Other routes are operational, the last time I checked ...
DeletePeople again going into negative campaign over everything. Jesus, if the calculation for some route was wrong and there are 5 passengers per flight, cut it!!
I'm sure they'll find a way to get some more money to start something else.
DeleteRyan is also free to start FRA-INI. They are already flying out of FRA to many destinations. Why not?
DeleteMaybe as there is no JU PSO on that route
Ryanair is also free to start INI-HHN.
DeleteIf they want to bother with this market at all after all this, Ryanair's gonna pick up the leftovers of the incumbent legacy carrier's bloated cost ops after a while. Unless they get another 15 mil injection.
DeleteWhat do you mean by another €15 million injection? You confused OU which got €13 million, JU got €5 million for five years of flying from INI. That is three times less than the number you quoted.
DeleteI'm afraid it's €5 million per year for three years, €15 million in total. Check your source again.
DeleteNope, chck again, the subsidies period is five years, not three.
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DeleteHm. https://srbin.info/ekonomija/er-srbija-pobedila-na-tenderu-nacrtanom-za-nju/
DeleteThis one says 15 mil, 5 per year. Anyone got the link to the actual tender?
I believe JU is getting €5 million a year for five years.
DeleteIt was written here in articles numerous times, most recently the other day in the Ryanair article. Nis subsidies are 5 years. Kraljevo subsidies are 3 years.
DeleteYes, but I don't remember the actual tender being linked at any time. History has shown interpretations can vary, so I'd be interested to find out for myself, as was the case with W6/SKP. As it stands, it looks like it's €5 million a year for five years, equal to €25 million total.
DeleteThere seem to be three versions circulating: €5 million total for 5 years, €5 million a year for three years (€15M), €5 million a year for five years (€25M). I wonder which one is true. Haven't been able to find any tender docs online in neither Serbian nor English.
DeleteThe only correct version is the one that was reported on this site a million times. That is 5 million euros per year for five years . You can see it on page 28 of the tender documentation
Deletehttps://www.mgsi.gov.rs/sites/default/files/%D0%9Aonkurnsa%20dokumentacija.docx
Thanks for the link. So the above link was also correct, with the correct wording: max 5 mil per year over a contract years with max 15 mil total over those five years.
Delete*max 5 mil per year over five contract years with max 15 mil total over those five years.
Delete13:48 started all the fuss incorrectly. So no mixup, 15 mil it is, capped at 5 /year.
DeleteSome people on here won't be happy until JU is gone. So sad.
DeleteSo Air Serbia gets 15 Million for 2 daily flights? :O in Comparison with OU´s 13 Million that is really a lot.
DeleteThree daily rotations. Do some research.
DeletePurchasing power in southern Serbia still remains relatively low. Swiss simply cannot maintain profitable operation if they have to push the prices down all the time to remain competitive at the market.
ReplyDeleteBut isn´t that why the Serbian government decided to take taxpayers´money and offer exactly that? Low prices.
DeleteThey never stood a chance once FDH got launched.
DeleteExcept this particular route served for connectivity to North America and other places, unlike Wizz and Ryanair routes. So it's not always about optimizing for 'low prices'.
DeleteSo I don't know if this outcome was planed or not, but INI just lost its main connectivity enabler. Connectivity options and score down the drain. Congrats.
Most of INI passengers are Serbian people living and working in Europe. Connecting passengers, especially those flying to America from Nis and southern Serbia are VERY limited.
DeleteYou're right, Nish didn't deserve this connection in the first place. What was I thinking.
DeleteIn life, you don't get what you deserve, you get what you get. It was never a profitable operation for LX anyway.
DeleteIt's a well known fact airlines operate at hair width margins and take time to mature to profitability, especially in the case of legacy carriers. If the market is destabilized by intervention they don't stand a chance, which is why spending money to launch FDH was a big mistake. We got an unsustainable village connection and lost a major connection one. And we paid for it. Ridiculous.
DeleteAnon 12.18
DeleteDo you have a source to back the claim that it was never profitable for them? I find it strange that they increased flights and capacity before JU launched FDH. ;)
Meanwhile Swiss is probably consolidating its operations in BEG. They are introducing 19 weekly to Belgrade from the start of the summer season!
ReplyDelete...and later on going up to 21!
DeleteWOW wasn't LX 16 or 17 last summer?
DeleteI see FKB is three weekly next summer. Didn't Wizz Air have 2 flights this summer?
DeleteFKB is a response to EW. Also I see MMX is 4/week next summer so that's where they got the plane.
DeleteWhat a shame!
ReplyDeleteI flew with all airlines from INI except Ryanair, the best service was on LX!!!
Maybe CHAir will come back?
INI is still a fragile destination because the system is focused to please the capital. Vinci is doing all its best to let the capital have its bigger share. Nothing new.
ReplyDeleteThe system was designed to prevent INI reaching 1 million and to compete directly with SKP.
Oh well, good for you, capital city.
The rubbish you just wrote is countered by actual passenger traffic at Nis which will reach record levels this year.
DeleteINI is far recording a 11% growth this year. So far 266.989 to 295.578!
Delete