The Serbian President, Aleksandar Vučić, has said the country’s national carrier is considering introducing scheduled commercial flights to China in the coming period. In comments following a meeting with the Chinese Ambassador to Serbia, Mr Vučić said, “We held very good and important talks … Serbia is very popular in China due to its friendly relations and we are considering for Air Serbia to launch flights to the country in the coming period, with assistance from China. We are in discussions”. He added, “Last year we registered 269.000 overnight stays by Chinese tourists. With a solid program, plan and campaign in China, we believe that number could reach up to five million. Obviously, not straight away, but we believe we can significantly increase these figures. It would considerably strengthen our hotel and tourism sectors. Chinese tourists are always welcome in Serbia”.
The Chinese Ambassador to Serbia, Chen Bo, noted, “We exchanged our thoughts with the Serbian President concerning bilateral relations in infrastructure, tourism, innovation and trade. We discussed closer cooperation in these spheres as part of the Belt and Road Initiative and the 17+1 mechanism, as well as economic recovery”. Hainan Airlines abruptly suspended its two weekly service between Beijing and Belgrade via Prague in 2018 due to low demand following a year of operations. Prior to the coronavirus Covid-19 outbreak, Belgrade was the eleventh busiest unserved route from Shanghai and the seventh busiest European market lacking flights to China's most populous city.
As of this morning, Air Serbia has operated a total of thirty flights to China with its Airbus A330 and A320 aircraft since March 21 to transport medical supplies and equipment. Cargo-only flights were run to Beijing, Shanghai, Guangzhou, Chengdu and Shenzhen. Last September, the Serbian President also discussed the resumption of flights between Beijing and Belgrade with Chinese officials. At the time, the Serbian Ministry for Construction, Transport and Infrastructure said, “There are valid reasons for the resumption of these flights, considering the existing economic cooperation between the two countries and an increase in the number of Chinese tourists visiting Serbia”.
With what plane?
ReplyDeleteWith YU-ARB my dear
DeleteFor one additional route, YU-ARA is enought
Deletewith YU ARA like the JFK flights
DeleteAnd what happens when summer comes and when JFK goes back to six weekly?
DeleteSimple, JFK wont be going back to six weekly. It will be three times with fares at a profitable level for JU.
DeleteToo bad for you, but JFK will go up to 7pw just so everyone can complain how it is a political, bottomless pit route :)
Delete7pw is impossible with one plane.
DeleteGet real.
He never said it will be done with one plane. ;)
DeleteIf they plan China flights then they can boost JFK to daily flights. Hopefully they add another departure in the morning.
In a reply below I wrote that the distance from BEG doesnt allow for a rotation under 24 hours as is with JFK. That means that any destination on the east of China (PEK, PVG, HKG, CAN, SZX) would either need a different departure schedule for every flight or have another aircraft sitting idle on the ground for long periods in BEG between rotations.
DeleteJFK doesnt help with the split schedule, so sending ARA daily to JFK is not currently possible without changing slots in JFK.
JFK will back to 6pw this sumer and 1pw is enought for China.
DeleteMaybe they will change JFK to 5pw, who knows..
Anyway, China flights can't be started this year..
JU has never operated any destination with one weekly flights so what makes you think China will? Not to mention that it can't fit once per week with JFK being six weekly. Please do some research before posting on here.
Delete@ mixajlo
DeleteYou could at least read the comments below to see what has been already written. In short:
- JU has spent 4 years bringing JFK to protability, and during their peak period, when they fly and carry the most pax, you suggest them to cut a profitable flight to operate a 1 pw rotation to another city, leaving the aircraft grounded longer than what it currently is?
- 1 pw doesnt scream high yield pax. On top of that, keeping a set of crew one week on layover isnt cheap nor efficient use of crew.
With a second LH plane it would be possible to do 3 PVG + 3 YYZ/ORD rotations with sufficient turnaround time and minimal ground time in a 48 hour window.
Delete@anon
DeleteYes, operated JU670 for ex.
@jatbegmel
Usually, I am reading ppl with nicknames
All of AV bots, skips
:)
If you are referring to BEG-LED as JU670 then I have to disappoint you but that route was never operated once a week. You might want to check your info.
DeleteSo anyone who doesn't sign his name and doesn't automatically agree with you is an AV bot? Are you for real especially since you wrote many things on here without providing us with a single piece of credible argument. You just make statements, bold and short statements without expanding on them. If anyone is a bot then it's you.
This is a high quality portal where we discuss aviation, start behaving appropriately.
If there is a perfect time for China flights, it is this year, as soon as the virus is gone. Chinese are preparing to start traveling again and Serbia has been trending in China on all social media due to Vucic being a clown and speaking in Chinese on live TV. I think they might strike a deal with some Chinese travel agencies and make these flights work.
ReplyDeleteWell if his clown-like behavior ends up bringing millions of Chinese to Serbia then why not. This is also a good opportunity for BEG to snatch some China flights from Budapest.
DeleteMillions.
DeleteRight.
Why not? We are already getting close to 200.000 annual visitors, 2 million is not unrealistic with good promotion
DeleteI can also see at least a million from the Peoples Republic of China flocking to its European sister country very soon. China is 1.4bn with growing income and interest towards RS + very favorable opinion.
DeleteWith these flights BEG can get ahead of the game by becoming the starting point for many Chinese groups visiting the region (Hungary, Croatia, Bosnia, Austria...).
DeleteYou really think that from 200k, there will be 2 million Chinese visitors in the coming years, especially after the whole Coronavirus situation?
DeleteThis comment section is starting to look like B92 comments section.
fishki, PRC is corona free, RS soon also. where is your problem with Corona? exchange between 2 corona free countries. drink a Corona and relax
DeleteSure, on that way Serbia will be no 1 destination for Chinese in Europe. Much better than France, UK, Spain, Italy. Because Paris, Rome, London is nothing compare to Belgrade.
Delete200.000 Chinese in Serbia last year? Not true. It was not even near to that number.
Croatia has much more Chinese tourist but still no direct route. But why not Serbia?
You really think that the virus just disappeared? That it won't resurface? That all these people that lost jobs in the crumbling economies around the world will make them say: Let's fly across the world!
DeleteMaybe you and your predicting buddies could leave any sort of name here so we can come back to you in coupe of years to compare the results.
Just a thought.
There were 144,961 Chinese tourists in Serbia last year. Official statistic.
DeleteThere is another thing in support of these flights - after the devastating impact that Covid is having and will have for China in virtually the entire developed world, I can't see Chinese people returning to 'Western' countries any time soon. Don't forget after this virus is over, there is going to something akin to the Nuremberg trials and China is likely going to pay a severe price for it's role in this. The good will they've generated (assisted by the Serbian gov't) in Serbia will mean they'll be less 'unwelcome' here, so it's a good time to capitalise for Air Serbia! Their connecting opportunities will be fewer also.
DeleteWhy are people so skeptical about all this? Look at January arrivals:
Delete8.183 which is an increase of 245%
So numbers are growing steadily and rapidly. Unfortunately corona stopped this already in February when numbers started to fall.
Also so what if Croatia has more Chinese arrivals? Does it mean Serbia can never overtake them? It makes no sense especially now when Serbia is starting to become extremely attractive as a year-round destination.
I am old enough to have been visiting this blog since way before 2013 and every time there is something positive about Serbia people line up to express their skepticism. What's the point when each time you are proven wrong?
These flights will happen because there is political interest on both sides. After all, solid growth in arrivals gives me hope that we might see another destination besides Shanghai.
This will also impact loads on many other airlines like flydubai, Qatar, Turkish Airlines, Aeroflot, Lufthansa, LOT... which will help them rebuild their presence in Belgrade.
What makes me the most happy is that BEG is already back to thriving. The best is yet to come.
How about being a bit more realistic, instead of whining how Serbia is constantly being attacked?
DeleteI see AV propaganda is working big time.
I would also like to add that Serbia had 28% more tourist arrivals in January or 106.774 which is already an impressive number.
DeleteHere are some of the main groups of tourists:
1. Bulgaria 8.600 (+28%)
2. China 8.183 (+245%)
3. Bosnia 8.036 (+14%)
4. Romania 7.459 (+17%)
5. N. MKD 7.139 (+52%)
6. Slovenia 4.310 (+17%)
7. Turkey 4.249 (+49%)
8. Greece 4.234 (+53%)
9. Germany 4.091 (+20%)
All these are arrivals in January so after New Year festivities. This shows you that Belgrade and Serbia are becoming more and more popular are a short term, city break destination for many.
Excuse me what AV propaganda? These are facts and figures which back claims that Chinese tourists are going to come in massive numbers. Growth over the past few years is best proof of that. The trajectory is definitely there. Why are you as a Croat so bothered by all this? Look at the numbers of Chinese arrivals in January, they more than doubled.
DeleteGrowth from Turkey is definitely thanks to JU entering the market and offering far more seats than KK did.
DeleteSo 8k will somehow turn into 200k in couple of years?
DeletePlease, explain us how the trajectory will be this steep in years to come.
:grabbing popcorn:
Well all you have to do is look at where the market was five years ago and where it is today. So feel free to take all the popcorn you wish because it won't change the fact that seems to bother you so much. I honestly don't see why you as a Croat care so much? Maybe because your own airport didn't get them?
DeleteYou tried to low blow, but you've missed the mark. Try again.
DeleteAnd someone should explain you that just because there is a steep trajectory in the beginning and when you start from basically zero, that trajectory won't forever be as steep and sooner, or later, the numbers will start to flat. Or even fall. Oh my! But that surely isn't possible because of Serbian-Chinese brotherhood, right?
People were also skeptical about Turks in Serbia yet here we are. Always so skeptical about anything Serbian.
DeleteNo. No one isn't skeptical that there will be more and more tourists once things go back to "normal", but to a megalomanic predictions about millions of Chinese that are queuing all that way in China just to come to Serbia.
DeleteOnce again, all of you future predictors, sign yourself when you're doing it so comfortably, so once the time comes, we can compare the results.
8k per month is already near 200.000 a year.
DeleteWait a minute.
DeleteIt was said that there will be millions. How did we retract to 200k all of a sudden?
Can we decide?
We are talking about over night stays which is mentioned in the article. Not about visitors.
DeleteWhat's there not to understand? 200.000 is a mere milestone. Chill.
DeleteIn the third reply it's been mentioned 2 million annual visitors.
DeleteWhich is it now, then?
Why stopping at 2 million only in that case?
DeleteWhy not 10 millions?
20?
If Xi decides 2m Chinese should make holidays in Leskovac, it will be Leskovac (credit to AV). That's how it works there.
DeleteGuys it's best to ignore Frishki, he literally only comments when he wants to mock or belittle others as we can see here today. How many constructive or positive comments has he made today or on any other Serbian topic? None. Exactly.
DeleteFeel free to ignore my comments, as much as you ignore the reality.
DeleteAlso, you must have a quite selective memory, but we established that long ago.
Again, who of you besides me is leaving the sign up name on here?
I rest my case.
You rest your case based on what exactly? Who says you don't comment as Anonymous on some other posts? You might want to rest your case because you have no leg to stand on. By the way, I am not the guys from above but I have been reading your comments for a few years now. They are always the same, over and over again. So much negativity. Like I said, you commenting something positive is as rare as the dodo bird. Like today, there were literally tens of different things you could write but you chose to attack others for being overly enthusiastic. I am not going to engage in this anymore because it's pointless. I just hope you feel better now that you have vented. Поздрав.
DeleteI see I have another fan out there. Nice to hear. Three down, two millions to go.
DeleteRegarding Anonymous posts, you could be solely behind all of these delusional, cheering posts as well. So much about "I'm not the guys above". I could be also behind some other Anonymous post, but you'll never find out, won't you?
You are obviously failing to understand the difference between negativity and reality. Just because some is opposing you opinion, doesn't make them negative. It just make them have a different opinion. Period. Simple as that.
There were tens of different things I could write about, but I didn't. I decided to comment on this particular thing and I'm carrying it through.
And again, just like your predecessors (or maybe it was only you all along), where did I attack anyone? Point it out for me, please.
Cao!
frishki always commented constructive and realistic stuff. He said nothing but the truth providing numbers and a realistic argument. Come on, there are more Bulgarian or Northern Macedonian tourists than visa-free China ones.
DeleteChinese are more interested in BUD because of buying properties.
Please guys, let's stick to reality and write constructive and real stuff instead of sci-fi figures. Thanks.
He didn't provide a single number. All he did was take what others wrote and mocked them without, in return, writing anything constructively. All he did was trash.
DeleteAlso are you seriously comparing Bulgarians in North Macedonia, two neighboring countries, with Chinese in Serbia who have to fly in from the other side of the world? Yeah. And then you are the one who is asking us to be real.
Bear in mind that Macedonians and Bulgarians do not visit only Belgrade but rather other parts of the country which are still very affordable.
DeleteMore than half a million Bulgarians visited Serbia in 2019 and as you can see the numbers are the same more or less which means that Serbia is visited throughout the whole year but a bit more in Easter.
https://www.nsi.bg/en/content/7054/trips-bulgarian-residents-abroad-months-and-country-destination
So compared with 8000 Chinese I don't know.
Those figures even don't include Macedonian tourists but this number can reach up to 250 thousand.
In other words, only those 2 countries have a contribution of almost 750,000 tourists.
What numbers do you want me to provide? A prediction for how many Chinese tourists will arrive to Serbia in the next couple of years? Yeah, I cannot do something like that, but what I can is to say that there probably won't be millions of them like you and your buddies (or was it only you all along) so comfortably did.
DeleteIt is good to hear JU's future plans not from the mouths of its own management but from the actual boss.
ReplyDeleteWould you expect it any other way ??
DeleteI suppose the one who pays, maintains the right to announce
Well this is actually one time when having Woochich speak makes sense as this is a political project and he and the ambassador and the main people, not JU management. They will merely execute what politics dictate.
DeleteYou know, the same way German politicians will run LH once the aid is released.
Flights from this region to China are usually political and not commercial. Same way Plenkovic was announcing flights from China to Croatia last year and not the CEOs of airlines.
DeleteI remember Tsipras was also announcing flights from China to Athens on Air China. Actually that route was so political that Athens suspended China Airlines' permit to operate Taiwan-Athens flights. lol
DeleteI think here many are trying to find excuses to throw more mud at Serbia's new attempt at growing and going back to thriving as was the case before Corona.
You forget who the shareholders are of these ex-yu carriers ... they are all majority owned by their respective govts. Mgt of each company is in their employ, so I see no big issue in people like Vucic making such announcements. As the earlier comment noted, those who are funding these businesses, ultimately have the right to make whatever comment they wish/desire
DeleteCould you please define word "political" in this sense?
DeleteDo you mean flying with financial support from Government because there is no sufficient demand?
Demand is created one way or another, either naturally (migration) or artificially (tourism and business).
DeleteIn this case is artificially created demand by creating tourist demand which is modest right now. The same way Croatia promoted itself in South Korea by using that famous tv personality some years ago.
Why is business and tourism artifical demand?
DeletePeople want to travel or to make business or both together. What isn't natural there?
The choice of destination usually isn't. It's usually chosen by tour operator depending on what kind of deals they get from hotels in certain destinations.
DeleteChoice of destination is different from tourism making artifical demand.
DeleteTourism makes natural demand and in some cases tour operators decide what is going to be the airport in the country but what is going to be the destinations' country is not decided by tour operator.
Also, at the time LCC was flying to each village on Mediterranean coast and when you could book accomodation whereever you wanted on various sites I believe tour operators played much less significant role.
Well, TUI had something like 400.000 seats on flights to Cabo Verde, they were offering attractive packages so people were booking trips to go there. This is artificial demand just because an agency decided to sell tours there.
DeleteNo one is speaking about the urge to travel, that's natural. But the choice of destination very often isn't.
Interesting how they didn't specify Beijing but China. Who knows maybe we get flights to Shanghai? Maybe even some other cities like Hong Kong or Taipei?
ReplyDeleteChinese tourism is already rebounding, flights to Portugal are resuming on 22.05 so there is definitely growing demand. I wouldn't be surprised if JU launched Shanghai and someone else launched Beijing.
With a coordinated campaign and support from the Chinese side these flights could flourish.
I doubt Taipei. Taiwanese need visas and Vucic is far too friendly with the CCP to ever flirt with the idea of doing business with Taiwan.
DeleteI doubt Taipei. Taiwanese need visas and Vucic is far too friendly with the CCP to ever flirt with the idea of doing business with Taiwan.
DeleteTaiwan is never going to happen...
DeleteThe key here is that they expect the flights to be subsidized.
ReplyDelete" With assistance from China".
Hainan was also subsidized by a local municipality in China.
DeleteSo what if they get subsidized?
DeleteNothing is wrong, it's a mere statement of facts. :)
DeleteThe same like AA was subsidized in DBV and EK & KE in ZAG etc.
DeleteApart from discounts from airports they were also receiving money from so called "udruzeno oglasavanje" fund.
As you say...facts
Anon 09:57 You are free to create your own facts to comfort yourself ;)
DeleteAnd you are free to ignore the facts you do not wish to see :-))
DeleteProbably it makes life easier for you.
American did not get any money form "udruženo oglašavanje" or any other way from Croatia.
DeleteActually they did. There is an article on the internet from last year where some official from American airlines said that routes such as Prague and Dubrovnik are risk free for them because they get financial assistance. I will try and find it after work.
DeleteAlso udruzeno oglasavanje in its report said that an american airline applied for funds in 2019.
Good thing is that BEG is expanded so there is room for more long-haul flights.
ReplyDeleteyeah, because in this story, the issue is available space at the airport
DeleteFinally, this is really good news. I hope a Chinese airline launched Beijing flights so that we can get access to their domestic and international networks. If their goal is to reach millions every year then it seems like BEG will become an entry point for Chinese visiting the region.
ReplyDeleteWhat I am interested in seeing is if the BEG expansion will feature only narrowbody aircraft gates or widebody as well.
Stands C7-C10 can and have accomodated wide bodies. Renderings of the expansiom seems to show that the gates will allow parking of wide bodies without needing to do so on an angle.
DeleteBut if widebodies are parked there then they are still going to use two airbridges. I seriously don't know why they didn't expand C10 to make it into a real widebody gate, it's not like there is no room.
DeletePositions C7-C10 from memory are wider than those from C1-C6. Potential is there to make 4 widebody gates which should accomodate 8 narrowbodies ie A319.
DeleteUnfortunately your memory has failed you. :)
DeleteThose positions can take up to an A320 series per remote stand. I was working the day EY B77W diverted to BEG on AUH-LHR many years ago and it took the whole four parking positions. :D
B77W is a larger, wider, longer ac than the A332. C stands is where JU parks the A332 when it uses it for JFK, so stands C7-C10 have and can handle widebodies. When ARA came for reregistration, it was parked here. Just because it takes more than 1 stand doesnt mean it cannot accommodate the aircraft, just that there are procedures in place when an ac of a certain size is parked there.
DeleteChecking the charts for LYBE shows:
Aircraft parked on stands C3A and C5A with length up to 71m (ie A330) TWY F is restricted to ac with wing span up to 65m. If length is over 71 metres (ie B77W), TWY F is restricted to ac with max wingspan of 52 metres (A320/B737).
Fun fact, you also have A1 which is able to accomodate the B763 but cannot the A332. HY used to always park at A1 back in the day.
I don't think you understood what he meant. From what I understood he didn't mean if an A330 can park there but if one of those gates will be big enough to take it on its own. Like a separate, real widebody stand.
DeleteNext to those stands is empty land, which is why I said there is 'potential' to make 4 widebody gates, that is 8 narrowbody gates, which is happening. Potential exists to make them wider, allowing for a widebody to park without blocking any other stand. Question is if they will do it.
DeleteThe apron with parking positions is not being expanded, they are just adding gates in front so if a widebody aircraft parks there it will have to take two gates. My guess is that they will keep widebodies on C2-3 and C4-5 as was the case until now and the extension will be used by narrowbody aircraft. With this extension Air Serbia can use the C platform during its waves, it will make it easier to concentrate all transfer passengers in one area. Imagine a plane parks at A9 and the connection is from C8. That's going to be quite a walk.
DeleteYouve mixed the gates but i get your point. Not extending the pier would still allow for another 2 gates to be used for the A330 (C7A and C9A).
DeleteBEG isnt too large, at worst it should be a 5 min walk. The added floor for the arrival pax would make it longer, will have to wait and see what they have planned.
This is extraordinary piece of news.
ReplyDeleteBEG is getting second wide-body destination at the time China starts opening to the world again.
Well done Air Serbia management - quick reactions as in some previous cases
This extraordinary piece of news has been promoted for couple of times during the past year, yet nothing has come out of it.
DeleteWell truth be told me did get Hainan with that unfortunate stop in Prague. What matters is that the number of Chinese arrivals keeps on booming and that we are getting closer to building up a mass of people.
DeleteNo, it was not promoted so oficially for Air Serbia.
DeleteThere were some rumours some Chinese carrier could start BEG after Hainan unsuccessful episode but nothing came out of it.
Regarding to Air Serbia YU-ARA was flying 6 pw to JFK during the summer and had no possibilities to open PEK.
Now if JFK gets lower frequency due to crisis Air Serbia could open PEK / PVG of course with Chinese financial participation.
Don't forget that A330s are so cheap on the market now as various airlines struggle to keep them in service. American Airlines is retiring all of their A330s in favor of the B787.
Deletehere is no way JU can make JFK and China with one plane. This is basically a confirmation that a second A330 is coming. If this is not exciting then I don't know what is. Spread love, not hate.
ReplyDeleteAs there will be low demand for flights to USA due to crisis could we expect to have with YU-ARA 3 pw JFK + 2 pw PEK?
DeleteIf these flights start, they won't start until this corona crisis is over.
DeleteCorona crisis is almost over in China and Serbia. What do these flights have to do with the bad situation in the US or the UK or France? Nothing.
DeleteThe Corona crisis is over in China.
DeleteExactly and from tomorrow there is no more state of emergency in Serbia. Also don't forget that there was almost no corona in Shanghai.
DeleteThe only connection between China and USA in this case is YU-ARA. This plane already flies to JFK and it is the question now if YU-ARB needs to be introduced or , due to low demand in USA, YU-ARA can cover both JFK and PEK
DeleteFunny you say there is low demand to JFK when flights were full until the airport was closed. ;)
DeleteI am talking about the situation AFTER the airport gets open again.
DeleteAs you probably heard the situation won't be even similar to the one we had before the crisis.
True, the situation with flights to China won't be the same as before corona as now we are going to have that. :D :D
DeleteChecking flight radar, you can see that the A330 cannot rotate a Chinese destination in under 24 hours like JFK could. PVG is roughly 10:30 flight time going, 11:30 coming back, while CAN is slightly longer and PEK is slightly shorter. Block time would bump this up to 26 hours at best. Take into consideration it would be optimal for the flights to fall into one of the waves. Using YU-ARA to operate both JFK and say PVG would significantly affect the JFK schedule which would stupid after the effort over the years to boost its performance.
DeleteA second A330 (YU-ARB) will need to come and I think a third destination where the rotation could be under 20 hours needs to be added to allow maximum utilisation ie:
BEG PVG 0045 1800
PVG BEG 2245 0530
BEG DEL 0730 1745
DEL BEG 1930 2300
This would both a 3 pw rotation for both, targeting 2 markets Serbia is trying to increase tourism and trade.
@JATMELBEG - that was EXACTLY what I was also thinking few weeks ago when I imagined that I am "route manager" in JU :)
DeleteDestination in China in combination with India could work out as we are trying to target both countries.
On the other hand...there could be different types of flights. If JU could figure out a way how to keep the same group of Chinese people for 7-10 days in Serbia (I am talking about "soft charter"), we could have flights to 5-6 destinations, as they would run 1 pw.
If our goal is "lets keep Beijingers/Shangainers...for 7-10 days and run our flights as pure touristic flights" then JU can start flying with one additional A330 to few destinations in China - Beijing, Shanghai, Guangzhou and Xian for starters. 1 pw from each town.
If their goal is to establish and grow a route, then 5-6 pw from one town, but they must figure out WHICH ONE to choose - Beijing or Shanghai??? Beijing - great for all transits with new Daxing airport OR Shanghai with more rich clientele.
One way or another, tourism with CHina is exploding in Serbia. I have a lot of friends who are renting appartments and doing tours with them - all are pleased and all are waiting to start ASAP
@anon13:14
DeleteActually, it is not going to be the same. It is going to be better as Serbia got massive media promotion in China.
Something like Croatia got in Korea before crisis when KE opened ZAG.
Simple as that.
And so sorry for you.
@JATBEGMEL
Thank you for your clarification. Maybe ORD or YYZ could be third destination
Maybe we will see them further boost their morning regional network to offer more connections from New York, Moscow, Beirut, Shanghai and so on. Would be cool to have morning departures to places like Sarajevo, Bucharest, Sofia, Tirana and so on.
DeleteYU-ARA would be only connection between China and USA? Oh really. Doesn't meter that there are nonstop routes operated by United, Delta, American, Air China, China Eastern and China Southern? Are you for real?
DeleteI don't think DEL can have such a schedule as it has to rely on transfers from western Europe. It would have to leave BEG at either 13/14 or around midnight.
DeleteI dont think one per week to various cities would work. Without dead heading crew around China, JU would have crew on layover in China for a week, which means theyre not of use in BEG ie expensive. Relying solely on O&D and tourists doesnt scream high yield either, and an opportunity to boost loads with transfers is lost. Its either one aircraft and one Chinese destination, or a few aircraft and a few destinations.
DeleteAs for YYZ, flight time is similar to JFK, ORD is further. That is why I went with India, as there were previously articles here on such. Indigo was willing to partner with JU for offering 1.000 pax per week on tourist packages if im not mistaken.
I mentioned in previous articles that another A330 could launch YYZ and boost JFK, which are similar lengths. YYZ at 4 pw would allow JFK to be boosted in the summer to 7-8 pw. I even played with the timetable suggesting introducing flights in the midnight wave to avoid taking too many gates for the other waves where space is limited, especially midday.
JU508 BEG JFK 0030 0430
JU509 JFK BEG 0630 2220
This allows more connectivity to the regional flights (TIA, SKP, OTP, SKG, ATH), opens proper connections to the Middle East (BEY, CAI, TLV, AMM), while KRR and ROV would be connected to the flights. Not to mention European destinations would have more options via BEG for JFK. BEG has the advantage of not having a curfew as opposed to most EU hubs.
In regards to more regional routes, a couple of destinations would work if they tweeked the schedules to have the ATR return sooner. 0600-1200 and 1700-2300 allow for 4 ATR rotations ie:
BEG BUD 0630 0745
BUD BEG 0830 0915
BEG SJJ 1000 1050
SJJ BEG 1120 1210
@anon 14:27
DeleteYes. Really.
In case you haven't seen today's topic is Air Serbia and not Delta, American, China Eastern etc.
So for Air Serbia YU-ARA is here the only thing that connects these 2 countries.
Like it or not.
JU would really have to do something extraordinary (in this region probably dump prices) so it could attract passengers from/to Asia from the region.
DeleteThere is just a very big competition from giants with very good products, such as TK, QR and FZ/EK who have very good connectivity. And I anticipate that they would not stay still if JU reduces prices, since they can leverage this better.
@ anon 14,37
DeletePush the schedules forward by 6 hours and you get what you were suggesting. I just gave an example of what a potential schedule could look like.
@ anon 15,29
TK, FZ, EY, QR works well for SE Asia, Indian subcontinent, Africa and Australia. China and Far East involves a large deviation. SU, LH and possibly LO is more competition to this market. From previous experience, SU midnight flight out of BEG has alot of connecting pax to PVG.
Take into considration that OS is fighting an expensive battle in VIE while AZ no longer flies to China and will from June see it downsizing. China-Italy is a large market, Croatia is popular with the Chinese, while JU has a decent network in the immediate region.
And how many big players is JU going up against in JFK? Far more than they do to Asia yet they seem to do fine.
DeleteWhat matters is that there is actual promotion and PR being done even before flights are launched. Even if non-stop flights are introduced expect many to reach BEG and Serbia through one of the global hubs. I expect Qatar to profit the most from this.
ReplyDeleteWhat I find stunning is that each and everytime there is a new JU news or developments, it is Vučić speaking out as if it is his new job at the moment. I have mixed feelings about this. This really proves that JU will be 100% controlled by the government with EY fading away from the scene as if there is no tomorrow.
ReplyDeleteWhat on earth are you going on about? This is business as usual, Вучић has been making statements about JU since day 1. What is exactly changing here? Nothing.
DeleteThat when there are important issues it is the CEO of the company that speaks not the president of the Republic. Cappicci?
DeleteWhy are you so focused on Woochich, haven't you seen that the ambassador also made a statement. Why are you so bothered by all this? Do you really don't want these flights to happen so much? :(
DeleteThis is absolutely the time to do it.
ReplyDeleteIn terms of priorities, these are the cities Air Serbia could fly to:
1. Shanghai
2. Guangzhou
3. Shenzhen
4. Chongqing
5. Xian
If it were a Chinese airline i see a potential for CZ to launch flights from Urumqi, similar as they do to Tbilisi.
Does anyone offer connections in Urumqi?
DeleteTo be honest I can't see that Chongqing or Xian could work better from BEG than PEK can.
DeleteSo let's see if it is going to be PEK or PVG
China Southern has a hub in Urumqi.
DeleteBeijing has a HUGE network to Europe with the likes of Aeroflot, LOT and everybody else.
DeleteIt's a lot more competitive.
Besides, the yields are much lower than Shanghai.
There is a reason Air China used to fly even Budapest flights via Minsk while many secondary cities, including Shanghai, were launched directly.
PEK could work only with a Chinese airline with a local point of sale.
Pearl river delta cities are often overlooked.
Chinese routes are almost excellently covered by BUD. It will be difficult for BEG to get more Chinese routes because BUD already secured many Chinese destinations. First, because of many Chinese that bought houses in BUD and also tourism. After all, BUD is one of the most visited cities in the world.
DeleteDo you have stats to back that claim?
DeleteBudapest is nowhere near being one of the most visited cities in the world.
DeleteIt is actually behind the likes of Brussels, Hanoi and Jakarta.
It is currently ahead of Belgrade but with the promotion Serbia has got in China and the fact EU is closing their borders until September that could soon change.
Also, it is a question of how many services will resume once restrictions are lifted.
DeleteYou might have missed the news that many flights from China to Budapest actually failed even before corona, starting with Chongqing-Budapest.
DeleteBUD may have more Chinese flights and pax overall, but since MA closed they dont have an airline to offer transfer options.
DeleteSerbia has increasing O&D numbers from China and JU has a decent, growing network to transfer pax via BEG. Serbia hosts a Chinese community while there are Serbs living in China.
All you have to do is look at the size of the new Chinese cultural center here in Belgrade. It shows how serious they are about their relationship with Serbia. Introducing non stop flights is the next logical step. There is more than just tourists coming and going. Why do you think SU introduced a third daily to BEG?
DeleteLOL! So true. Passed by it the other day, it's monstrous. It's also funny because it's right next to the Japanese embassy which looks minuscule in comparison.
DeleteTrust me, the Chinese traffic to and from BUD is way way much higher. You have no clue how popular BUD is in China even with a visa required.
DeletePVC and PEK have been served for a long time even before the birth of the new Air Serbia in 2013.
Untrue.
DeleteThere were two weekly flights from China which were cut as soon as MA went bust.
Many cities around the world are popular with Chinese tourists, i don't see why Belgrade wouldn't be one of those.
Anonymous 13:16:
DeleteChengdu, X'ian and Chongqing had not that great loadfactor, because those flights were announced 1 month before launching. This summer would have been better, but the virus...
Could we see PVG-ZAG-BEG at first as flights have more chance like that? Combine the demand for both.
ReplyDeleteWho would fly it?
DeleteAir Serbia surely wouldn't and we have already the example how it worked with other carrier via PRG.
Thanks, but no thanks.
JAT no longer exists, and neither does Yugoslavia. Croatian government hasnt liked JU's expansion in Croatia and I doubt they would ever approve of any flight flying from BEG via any Croatian city. On top of that, OU doesnt cooperate with JU on any flights.
DeleteHaving said that, it would be simpler for JU to fly any Croatia bound pax via BEG where more options are available (ZAG, DBV, SPU, ZAD, PUY..) and not just ZAG.
Before corona JU did add a morning departure to DBV (07.30). I doubt it will happen now. These offered connections to JFK in both directions.
DeleteTravel and trade between Serbia and Croatia has been growing over the years. BEG has grown, JU has grown and so has tourism in Croatia. The distance between BEG and Croatia makes the ATR easy to use on the routes. It would be nice to see either SPU or DBV go year round.
DeleteCompetition will be lower as alot of airlines have dropped capacity. I doubt AA will return to DBV in the 12 months as they recover their main European network, which would leave JU some room to react.
As someone posted on here a while ago, Croatia as a tourist destination in Serbia is negligible so I doubt JU would rely on that. Unfortunately many have not returned to Croatia since the 1990s so O&D is still limited meaning we are left with transfers. As we all know there won't be a tourist season in Croatia especially now when the French government advized against travelling abroad for holidays. I think JU will decimate their HR network this summer.
DeleteA quick 1 minute search found:
Delete103.000 Croatians visited Serbia last year, while in 2017 over 150.000 Serbians visited Croatia.
Numbers may not have recovered since the 1990's but they are recovering.
Those numbers by themselves are not enough given how many Serbs travel to certain parts of Croatia to visit family or their property. Most popular city break destinations for Serbs are Italy and Germany, most money is spent there. When it comes to seaside destinations, absolute number one is Greece followed by Turkey in distant second. Montenegro is in the fifth spot.
DeleteIf only 1% of the above figures travelled by air, its enough to fill an ATR daily for just over 20 days, at 5% for over 3 months. Factor in transfer and its how we get the roughly 35 weekly flights between BEG and Croatia. DBV and SPU for a good couple of months is pretty much A319/A320 ops for the past couple of years, while frequencies and destinations have only increased.
DeleteI never claimed Croatia to be a top destination for Serbian tourists, or vice versa, however there is demand and that demand is increasing, and will continue to increase.
Demand will depend on the political situation in Croatia and what kind of environment they create. Kolinda attending a Thompson concert definitely isn't a step in the right direction.
DeleteAs for those who visit Croatia and who are going to visit family, don't forget that they carry a lot of luggage so buses or cars are more attractive than the plane. That said, Belgrade-Zadar last year was sold out almost exclusively filled by locals. Though that makes sense since lot's of Serbs have been historically living in that area. Many might have switched from buses to planes.
I could see these happen around New Year.
ReplyDeleteIn September.
DeleteBajkoviti planovi koji bi morali biti podržani od strane vrlo ozbiljne državne turističke organizacije i avio kompanije (AS sada ukupno ostvari 2,5 miliona putnika godišnje) , ovo je ozbiljna matematika u zemlji sa nedovoljno razvijenim (banjskim) turizmom, u protivnom ako bajka započne da bude realna, korist bi bila višestruka za radnike u turizmu i aviosaobraćaju, čak i sa 2 mil kineskih turista godišnje bi NTesla imao ogromnu korist, a sa 3 do 5 mil kineskih putnika morali bi proširiti broj zaposlenih, ovu bajku započeti što pre i Hitno u narednom kvartalu dok se Kinezi nisu razmileli po EU
DeleteКинеза има довољно, могу се они размилети по целом свету. Поента је у томе да се Србија јако добро изрекламирала у Кини, посебно сада за време короне. То је кец у рукаву. Увођењем директних летове између две земље отворили би се додатни канали који би додатно подстакли развитак односа.
DeleteВезе Србије и Кине постају све јаче а челично пријатељство се наставља и у добу благостања. Прво Кинези морају упознати Београд а тек онда проширити понуду на бање, планине и тако даље.
Потенцијал је огроман и драго ми је да је Србија то препознала. Време је да се окренемо опоравку туристичке сезоне поготову због домаћих хотела, водича и тако даље.
Paris ima 3,8 milijuna kineskih turista, ali Beograd će ih imat 5.
Delete^ Predlazem ti da procitas ponovo clanak ili da koristis google translate ako ga ne razumes. Nigde se ne spominje 5 miliona turista vec nocenja. Velika razlika.
DeleteМислим да поента није у разумевању онога шта је написано већ само да се искаже неверица у планове Србије. Нажалост за многе чињеница да се Србија претвара у туристичку дестинацију једноставно не може проћи јер изгледа само једна држава у нашем региону држи монопол. лол
Deletewhen they gonna remove this serbia creates livery from ARA?
ReplyDeleteI hope soon
Deleteit was about time
ReplyDeleteI can only imagine how beautiful two JU A330 at BEG next to each other would look. <3
ReplyDeleteWith second A330 could we maybe see them fly two times to Shanghai and maybe two weekly to Chicago? Or can they make it three times to both destinations?
ReplyDeleteIf this goes ahead there is no chance for Air Serbia service to Chicago and Toronto for a very long time, if ever. New York and China, that's it.
DeleteAnon 14.52 very eloquent explanation back by facts, figures and numbers. :)
DeleteYou can have detailed explanation with many figures, colorful charts and numbers written by some amateur and still be very wrong. Instead you get the essence:
DeleteUnder pre-covid (a.k.a normal) market conditions Air Serbia wasn't able to launch second long haul service since 2016. That is a fact. If they launch China they will need some time under new post-covid conditions to grow that service. Hainan was proverbial canary in a coal mine, that service didn't really grow by leaps and bounds. Air Serbia will also need to re-grow JFK before they are ready to launch destinations 3 and 4. If the JFK market was challenging for JU in 2016, 2017, 2018 and 2019, next couple of years could be even more so. Worst case scenario: they won't go to YYZ and ORD at all. Still need charts and figures?
Things in JU have changed alot since 2016.
DeleteJU transited from a 'boutique' airline to hybrid. JU went from a loss of 50 million euros to 8 million in 2018. JU went from cutting back frequencies and destinations to opening 11 in BEG, a base in INI and flights from KVO in 2019. Figures for 2019 from the little that JU has released seems promosing and possibly their first profit ever.
No official data has been shown on how JFK performs, so if you have, share. It seems they make money May-October, probably mid December-mid January, but the rest of the months eat into what ever profit they made, possibly more.
One aircraft one destination will be difficult to make work. 2 aircraft and 3 destinations may be better. 6 weeks, 3 per aircraft for maintenance in the winter when ops are reduced would increase utilisation of an aircraft otherwise on ground for 4 days a week.
Just my thoughts and observations.
JU is still a relatively small airline and losses shouldnt be too big due to the crisis, and the government will back them. I dont think they will produce a loss as seen while they were with EY management, while on the other hand competition on all sides is affected. JU wont be the next TK/EK/QR/insert airline, but it could use the opportunity to jump into a couple markets.
Also let's not forget something extremely important here. Unlike in JFK, in China JU will carry a lot of O&D passengers, that is tourists visiting Serbia. By having a nonstop flight you will allow passengers to avoid transferring at various airports and dealing with their sanitary regulation which are different from one market to the other.
DeleteAlso this summer JU was supposed to have its best ever regional network. Finally double daily rotations to places like Tirana, Thessaloniki and Athens which are all a great source of transfers to JFK. Bucharest was also boosted and allowed far more connections as well.
So JU in 2016 and JU today are not really the same airlines.
Looking forward to either a newer Airbus or a nice big old Boeing!! Prices are so cheap they are giving them away!!
ReplyDeleteNapalili ste se momci kao da je najbolje doba u avijaciji a ne vreme totalnog kolapsa. A tek to sto kaze predsednik to posebno moze da se okaci macku o rep ... zato take it easy and step by step.
ReplyDeleteЗнаш како друже, ми смо такве коментаре као твоје читали сувише често у претходних неколико година. Исто, али буквално исто, се писало и када је кренуло да се шушка како ће ЈУ можда увести Њујорк. Овде је била бујица негативизма па није било ништа од тога посебно када је изашла слика офарбаног А330 спремног за испоруку. Дакле молим те, време је да нас оставите на миру са теоријама завере и да се сви радујемо предстојећим летовима из Београда за Кину.
Delete+1000
DeleteAnyone remember BEG's performance during the first three months of JFK? Was there significant growth? I mean did JFK affect in a positive way their numbers from the start?
DeleteThere is quite a few articles on the route published here. This one was just under a year of starting the flights:
Deletehttps://www.exyuaviation.com/2017/05/air-serbia-to-maintain-long-haul.html?m=1
JFK has definately brought more pax to BEG. I wouldnt say significant growth, it is one aircraft after all. Load factors are above JU average, while cargo seems to be doing well.
https://www.exyuaviation.com/2019/06/air-serbia-registers-growth-on-us.html?m=1
There is room for growth, and I think with another small expansion it could help improve the issues they have on the route ie seasonal loads and suspension of flights (ie loss of potential revenue) when the aircraft goes for maintenance.
It's not just about the profit that it brings to JU with respect to the JFK flights. There are a number of other issues that make it unique and a national interest issue;
Delete1. connectivity of direct flight to North America without depending on a stopover in the EU;
2. the increase of tourism to BEG/Serbia from U.S. passengers looking for direct links;
3. image. it is important - not just to Serbia, but also to the externals in the EU/US;
4. Trade - direct delivery to the U.S. for some goods/businesses
Some of these things are secondary positive financial effects to the Serbian GDP, but also for investment.
Fantastic news! Austrian Airlines on suicide watch.
ReplyDeleteTalking of Austrian Airlines, they are giving up on Boston after cancelling Miami and downgrading LAX to a summer seasonal destination. Let's see what more is cut with the three 767 leaving the fleet.
DeleteMozda sada kada nema ogranicenog ulaganja u avio saobracaju treba iskoristiti priliku i nabaviti jos 2 A330 i pokrenuti Peking,Toronto i Cikago.
ReplyDeleteJFK 7X
YYZ 4X
PEK 4X
ORD 3X
It would be so cool if AirSERBIA operated Dubai flights every night, could be nice with Europe arrivals such as CDG,NUE,TGD,ZAG,LJU,MAD,VIE,TXL,FRA,ZRH,FCO,CPH,AMS.
ReplyDeleteAir Serbia could be competitive with other carriers, as a "low-cost" alternative. Flights would take off around 11pm for a return at 3pm, perfect because there are flights to Western Europe just after ( they take off around 4/5pm, so a 1-hour layover would be ideal)
Hope it’ll be makeable with YU-ARB, why not launching DEL flights
Problem is that the A319 could do 6 rotations in the mean time. That was the reasoning behind closing AUH (JU800/801), which used to arrive in BEG at 11,20 (12,20 in the summer) and be away for 2 waves.
DeleteDXB is slot restricted so it might not get the slots it wants/needs. Plus, being an EY partner, I dont see it happening.
Most of those destinations you listed have multiple daily EK flights, while FZ also flies to BEG, with which they would have to compete with. Product wise, the JU A319 isnt competitive for the Gulf market compared to the competition, while the A330 would be too large without decent EK connections.
Market between Serbia and the UAE is pretty big and we've seen that from FZ's constant increases. I wouldn't be surprised if Wizz Air actually launches BEG from AUH once their AOC is approved and hub set up. They have a strong brand awareness here and they could easily take on Etihad which charges around €550 for a return flight to AUH- compared with €350 with FZ to DXB. They are selling BUD-AUH for as little as €60 one way. That said, Etihad could respond by either sending their widebody to BEG or by replacing their service with Air Arabia Abu Dhabi.
DeleteFZ has increased frequencies but have decreased them as well. They also have a large amount of destinations to transfer pax onto, both the FZ and EK network. Alot of pax transfer to MLE and ZNZ.
DeleteJU's A319 product would be a major downgrade on the offer between Serbia and the Gulf. Even the old cabin configuration was bad compared to the competition, but still ok.
A crazy idea would be for JU to replace EY on the BEG-AUH route and upgauge the route to an A330. That way, AUH becomes a better transfer option for the Serbia-Asia/Australia market. But JU would need to have the flight connected with the region which lacks flights/frequencies with the region (TIA, LJU, SJJ, DBV, SPU, TIV). I remember on one JU flight AUH-BEG, around 20% of pax was connecting to TIA. The make up of the pax on those flights was interesting to be honest. However, downside is what to do with that additional A330 needed.
Regarding price, there have been times EY was cheaper than FZ, but usually FZ is cheaper.
If you really think Air Serbia will be expanding this summer you are deluded. It is more likely the New York flights will be scrapped along with many other routes, and half the fleet grounded. The real effects of Coronavirus haven't even started yet, there will be a global economic downturn. All of the world's Airlines will be shrinking if they are lucky, if not then
ReplyDeletemany will end up out of business. Air Serbia is not immune to an economic downturn and will cost Millions of euros to keep afloat.
Scrapping New York now would be totally idiotic after all the millions that were invested into making it what it is today- a profitable six weekly operation in summer.
DeleteOf course this summer they won't have more than 4 weekly flights but for them it's great many around them are struggling. Don't forget JU has transfers to rely on as well. It helps them that UA isn't returning on EWR-ATH and DL has announced barely daily flights. That leaves them with a massive ethnic market which will no doubt go t Greece this summer.
Isn't that the point re JFK ? It only makes money in summer and will never make money in the winter mths. So in a post-covid world of recovery - which as the original posted comment correctly stated, it will take the better part of the next 12-24 mths to get back to any sort of normality. With that, they are better off making JFK a seasonal operation - just like many airlines do with many destinations to the USA - and in doing so, strike a deal with a wet lease operator to fly those mths, just like they do with any other seasonal route when they bring in additional aircraft to fly seasonal demand routes. The 330 they have, can then be used to fly to China or anywhere else where the Big Man thinks is good for the country.
DeleteDoing this will solve the seasonal JFK problem and will allow them to fly to China which is clearly a priority for the President.
JU has a lengthy period in the winter when JFK is 2 pw (4 days a week parked in BEG), and another where its roughly 3 weeks in maintenance. No amount of magic will make that profitable.
DeleteA second aircraft I have commented previously could:
- Boost JFK to daily or 8 pw in the peak summer period where demand is big.
- Launch YYZ 4-5 pw.
While one aircraft is down, at least the other is operating revenue flights even on the reduced frequencies at almost full capacity.
Its no secret that YU-ARA has been an expensive lease. This has changed with the current situation, I wouldnt be surprised another 2 A330's could now be leased for the same price JU pays currently for 1. Fuel is at a low, aircraft lease is now at a low - 2 major expenses the airline would have to pay.
As for the current situation, who knows what will be allowed in the next months. If EU hubs dont return to some capacity to meet demand, there will be room for JU to operate their few frequencies, for the O&D demand, possibly a couple regional transfers as well as cargo. BEG after all seems it will be open before many other EU airports.
But guys, I am starting to doubt about JU's long haul announcements. First they say, JFK daily then it was Toronto, Toronto and Toronto. Then it was suddenly China then Beijing and now Shanghai. Really, it is very difficult to now trust what a politician will say. I can't believe people commented so much on something that has not even been approved and especially from an airport which has been entirely closed for almost 1 month.
DeleteAirlines are barely surviving and you go off with all those huge Chinese expansions.
Wait a minute, didn't admin also post YU-ARA photos? Did you see it is now a cargo plane and not passenger one?
It will take at least 2-3 years for the aviation industry as a whole to recover from this.
It is fine to dream but lets stick to reality and not science fiction.
To start, no one from JU or the government announced JFK to go daily.
DeleteThe government has talked on having flights to China, but until now never insisted on JU operating them.
YYZ was never announced by JU and have commented next to nothing about it.
YU-ARA operates cargo flights mostly to China because BEG is closed and Serbia needs the supplies. What should the government do, lease a cargo plane while its own capacities are grounded? And btw, YU-ARA has gone for pax in IAD and LAX as well.
Absolutely right itll take a couple of years for the industry to recover. JU however is a small airline so a smaller injection is needed. Mihajlovic mentioned a couple weeks back that JU is said to have lost 35 million euros. LH is looking for a 10 billion euro bailout, while for OS 767 million euros while the Austrian government has put a condition for expansion of long haul ex VIE, fleet renewal and maintaining the VIE hub. AC for Q1 lost $1.05 billion, in march burned $22 million daily and will retire 79 aircraft (ERJ190/A319/B767) including RV, and the list continues. Then there is AF, KLM, BA, LO, not to mention Norweigan. Add as well the on going issues airlines have with the 737Max and B787.
Hypothetically JU burns 50 million euros due to the crisis (which btw was how much EY management managed to do in 1 year in JU), double it even, that isnt too bad and quite manageable for Serbia. JU has significantly reduced its losses the past 2-3 years, lets wait for 2019 results, but there is the illusion its positive since JU started giving updates it previously never did. Competition has significantly been reduced which can work in JU's favour. No body is talking about JU becoming the next TK, but adding a couple of aircraft isnt unrealistic and is managable in preparation when things eventually go back to normal.
Air Serbia is in a much better position now to get a second A330 and start new route(s) for two reasons. First of all, planes are much cheaper now and price will only go up as services reopen. Air Serbia is in a great position to act now before prices start to rise.
ReplyDeleteNext, Air Serbia is stronger and more valuable now that state commited financial support. Even without support Air Serbia is a lot more valuable and most extreme critics agree. For example, ex-jat CEO Predrag Vujovic said in recent Danas interview that Etihad's 49% part of Air Serbia is worth 200-300 million dollars. That means all of Air Serbia is now worth 400-600 million. Compared to 2013 when jat was worth about a dozen million at the time of Etihad deal, it means value of Air Serbia has since increased about 50 times, wow! That compliment is coming from established Air Serbia critic, so it could be even more than 50 fold increase in value. Not too bad, not too baaad...
If he wants to buy at that price, sell it!
DeleteThe market cap of LH group is now 3,7 bln euro. The net profit of LH group for 2019 was 1,2 bln euro.
If you don't like his valuation of Air Serbia and unintended compliment to Air Serbia management for 50 fold increase in value, you can counter that with your own vauation. It will certainly be much higher than the value of jat in 2013.
DeleteOr you skip your own valuation and just go after the reputation of that expert who reduced the value and image of jat in less than 3 years as a CEO, has been out of industry for more than 16 years (Wizz didn't exist back then!) but still gets invited by media as an "expert".
He may be an expert in aviation, but he apparently has no clue, when it comes to finance and in particular companies valuations.
DeleteA typical valuation approach is to use industry type multipliers. If you tell me how much was EBITDAR of Air Serbia for 2018 I will tell you the enterprise value of Air Serbia, and if you tell me also how much was its then financial indebtedness, I will tell you the equity value of Air Serbia.
Still whatever are the actual numbers, one thing is sure: his valuation is totally out of the blue. Buying Air Serbia for that money would mean that even if Air Serbia would have 10 mln euro yearly net profit (difficult to imagine) still an investor would have to wait 40-60 years to get back his investment!
'kay, so much lower valuation will then make it very easy for government of Serbia to buy out Etihad. Once 100% nationalized, they can use those $$$ saved on Etihad buyout to help Air Serbia, buy planes etc.
Delete1. what is Serbia's interest in buying out Etihad (unless Serbia has too much money)?
Delete2. shares owned by Etihad are one thing, but the debt owed to Etihad by Air Serbia is another thing, and I expect no shares will be sold unless that debt is fully repaid and we are talking >100 mln euro of debt - is Serbia ready to bankrupt Air Serbia and start from scratch as a way of not paying that debt?
3. Serbia is part of the ECAA, so it won't have total freedom in subsidising Air Serbia - for now it seems only Germans are giving to their airlines something else than repayable loans and you know that everybody is equal but Germans are more equal than others
genuine questions:
Delete1. what interest Serbia has in buying back shares owned by Etihad (unless Serbia has too much money to spend)?
2. Etihad won't sell shares, unless all loans granted by Etihad to Air Serbia are repaid prior to that and we are talking about >100 mln euro - or unless Serbia would be happy to bankrupt Air Serbia to get rid of all those debts and start from the scratch with a new airline?
3. Serbia is part of the ECAA and therefore doesn't have full freedom to subsidise its airline - by now all airlines in ECAA except for LH are getting only loans, which means they will have to repay them at some time - and we all know that everybody is equal, but Germany and LH are more equal than others (including Serbia)?
1 - is it too much or too little? if you claim valuation is low then it can't be too much money to spend. make up your mind
Delete2 - how do you know that ey won't sell shares unless loans are repaid? please provide source (m.brkic type of "journalism" doesn't count as a valid source)
3 - your point is self defeating and you just proved rules don't apply.
Re. 1-2.
DeleteBuying back shares owned by Etihad necessitates repayment (or rather refinancing) of the loans granted by Etihad to Air Serbia, so even if value of the shares is pretty low, the overall amount that is required is pretty big.
Maybe I don't have a particularily good opinion about Etihad, but they are certainly not straightforward idiots. When you exit, you generally don't leave behind any valuable things. As long as there are some valuable things left, you keep the foot in the door, and in particular, if you can keep the foot in the door for close to nothing (as the value of shares is pretty low).
On a more serious note: repayment of intra-group loans incurred by the target (ie. company whose shares are being sold) is a standard term in any M&A transaction.
And my question again: even though the value of the shares is low: why this expense at all?
And would it be possible that Serbia bankrupts Air Serbia and starts from the scratch to avoid repayment of those loans?
Re. 3:
I only proved that the rules do not apply for the top mighty. They apply for all the rest.
Be real, for years Serbia has been hiding all the subsidies to Air Serbia, except those that were clearly named as repayment of the old JAT debt. All PSOs, marketing contracts for Serbia Creates, BEG discounts and God only knows what else. And I am not saying that in other countries there are no subsidies, so pls don't start about Montenegro or Croatia. I am just saying that Serbia was not willing to break the rules of ECAA openly as it has a lot at risk (participation in ECAA, which is crucial to Air Serbia, EU funds etc.).
Will Serbia go openly now?
4. I don't think Etihad will sell their shares in Air Serbia. Their loans are interest-bearing at, what I recall, decent levels, so unless they get a very good price or are in need of money, they won't sell.
ok let's see what will happen with etihad. i think they will go separate ways. to be continued...
DeleteI think Air Serbia will buy Etihad shares. If you can please ask NSA to send me a copy of renewed Etihad-Air Serbia agreement with loan details, that would be great. We can then continue reasonable discussion.
DeleteMost recent data for BEG-JFK-BEG:
ReplyDeletemonth - number of one way flights - total number of pax - LF
2019-07 - 57 - 11,220 - 77%
2019-08 - 54 - 12,081 - 88%
2019-09 - 34 - 6,452 - 75%
2019-10 - 24 - 4,857 - 80%
year-to-year comparison:
2018-07 - 52 - 11,058 - 92%
2018-08 - 54 - 11,992 - 87%
2018-09 - 46 - 9,922 - 79%
2019-10 - 34 - 6,629 - 77%
Not bad considering YU-ARA was in IST on maintenance from Sept 23 for around 3 weeks.
DeleteCompetition as well grew last year, LH reintroduced the 3rd daily MUC rotation, AA launched DBV, AF returned to BEG, while LO had transatlantic ops out of BUD.
OS as a comparison:
Delete2019-07 - 340 one way flights - 73,358 pax - 86% LF
2019-08 - 338 one way flights - 74,818 pax - 87% LF
2019-09 - 276 one way flights - 59,264 pax - 88% LF
This is for all their US flights during that period (LAX, IAD, MIA, ORD, EWR, JFK).
For me JU is the same as railway, decent highway or public transport. I never expected them to be truly profitable, but to allow me to do my business efficiently, pay taxes, employ people and pay their salaries and payroll taxes.
ReplyDeleteWhen this virus situation is under control, nothing will be as it was. With subsidies being thrown at national carriers like LH, BA etc (yet not on Virgin), JU should capitalize and move quickly and wisely. Austria has doubts about OS under LH ownership, all others are in a poor condition. Throwing money at AirSerbia could as well be useful, but only if this proactive approach continues. I don't care whose pet company that is as long as it brings benefits. ARA to China - bring Chinese here to spend some cash, ARB to Americas, carry whatever there is to carry to the US and or Canada.
Last time I was in Geneva, I witnessed how one single lady received back a pile of cash in tax refunds. She was in line ahead of me and carried an Air China boarding pass, and an ordinary Chinese passport, not even one of their special ones. She was one of many that day.
I like how many people comment and not have real insight. China has a population of 1,400,000,000 people and in 2019 150,000,000 of them travelled internationally. Of course larger cities and countries have better exposure. Even if the target is 1% of the 2019 figure is a large amount (1,500,000 to be exact) for Serbia. Serbia even though small has a small but growing interest in China due to being China friendly and also to our previous history ie (Tito) My wifes grandfather didn't know about the name change from Yugoslavia to Serbia but knew Tito and Walter brani Sarajevo. Also my wifes friend last year for her honeymoon visited guess which European country? They came to Serbia of all places for the honeymoon, went all over Serbia for 7 Days. One reason NO Visa required, also they liked nature, not into beaches that much. But I wont let some facts in the way of some baseless posts.
ReplyDelete