Ljubljana Jože Pučnik Airport has proposed for the Slovenian government to incentivise airlines by providing ten euros per passenger in a bid to retain carriers currently serving the country and attract new ones. It comes after the airport recently announced it was in talks with one of the largest airlines in the region over potential flights. The General Manager of Ljubljana Airport, Zmago Skobir, met with the Prime Minister of Slovenia, Janez Janša, earlier this week to discuss the impact of the ongoing coronavirus pandemic on air traffic and potential government assistance. “The Ministry of Economy should help carriers during the initial stage of relaunching routes. We are talking about just ten euros per passengers. This is feasible under EU rules and other countries have already resorted to the measure”, Mr Skobir told the “STA” news agency.
According to the General Manager, the existing 40% to 50% cabin load factors on flights to and from Ljubljana raise the question whether some airlines will maintain their services to the city over the winter. "The situation now is no better than we anticipated back in April. It’s of paramount importance to keep these routes so they're here when passengers regain their trust in travel. There is fierce competition for air carriers among airports. Good connections will be key next year, when Slovenia presides over the Council of the European Union during the second half of 2021”, Mr Skobir said. He expressed his disappointment with the ministry, which is yet to respond to Fraport Slovenija's initiatives.
The Ministry of Economy has said it is in talks with airlines over new services to Slovenia, however, the General Manager of Ljubljana Airport said operator Fraport Slovenija has no information on this matter. He added that the state's strategic position on how to sustain key routes was unclear. “It would be more economical and sensible for Slovenia to support large airlines with a diversified network than set up a new national carrier after Adria Airways went bankrupt last year. Setting up a new flag carrier would be more expensive and time-consuming and would also require additional funds during the pandemic, so there is no added value in such an effort”, Mr Skobir said. He is convinced the airport can function normally without a national airline.
Is it just me or does there seem to be conflict between the airport and the government?
ReplyDeleteGovernment obviously wants a national airline, the airport does not.
DeleteBut I don't understand why? Wouldn't the airport gain more from a national airline?
DeleteNot if the airport is forced to give not only massive discounts to the national airline.
DeleteOr worse not get paid at all and not being able to force that airline to pay back its debts.
That is thew story with most national airlines not only in our region but all over the world.
But it seems unfeasible that the airports wants the government to subsidize and they do nothing.
Delete10 euros per passenger would not come cheap.
ReplyDeleteIf they handle 1 million pax as they estimate next year, that's 10 million euros. That really isn't that expensive.
DeleteDidn't Solinair say they only needed 5 million?
DeleteThere is no chance it would cost so little. Maybe it's a start up cost but what about leasing planes?
Deleteten millions € for one year is massive
DeleteBut how much would it cost for a national airline?
DeleteProbably hundreds of millions.
Deletehow did you come to hundreds of millions ? We are not talking setting up Emirates
DeleteOr probably billions. My estimate is based on scientific research. NOT.
DeleteShouldn't the airport operator provide incentives for airlines???
ReplyDeleteGood luck with that.
ReplyDeleteThere is definitely some struggle going on behind the scenes here.
ReplyDeleteThis sucks. Why are they so against a national airline?
ReplyDeleteBecause national airlines suck. They are only good for the people who work in them and of course for the politicians who get to both brag about them and appoint their friends and relatives in them.
Delete@Anonymous09:12:
DeleteWhy are they so against a national airline? - Several reasons ... Firstly, both Skobir and Krasnja hold a grudge against the idea of Slovenia having a national carrier since both of them used to work for Slovenian nation carrier Adria Airways and they bot got fired. Not at the same time, of course. Secondly, they both want to present themselves successful in the eyes of Fraport's top management. They've been making empty promises of attracting airlines from Middle East, Far East, Iberian Peninsula, Apennine peninsula, south of France etc. for more than a decade without any success. Their stance was that Adria was the sole obstacle for other airlines from those destinations not flying to Ljubljana. After the AA's bankruptcy it became clear that was not the case. Adria wasn't even flying to those destinations. And we've all been witnessing other airlines weren't actually stumbling over each other when Adria's connections were to be replaced. That's been achieved after a delegation from Slovenia's Ministry of Environment and Spatial Planning paid a visit LH HQ in Cologne. Now the Ljubljana Airport managers are trying to attract air carriers with the help of taxpayer's money ... The same neoliberals who've advocated to liquidate Adria due to being given taxpayer's money and let the invisible hand of the free market take care of Slovenian airline sector by itself are now trying to use taxpayer's money to incentivize foreign airlines to fly to Slovenia. Before Adria's collapse Slovenian taxpayers used to recapitalize Adria with 3 to 5 million per anum on average. Now when the free market no longer fits the needs of the neoliberals, they're trying to lobby Slovenian government to incentivize foreign airlines with 10 to 15 million (given the projections of annual 1 to 1.5 million passengers) per anum of taxpayer's money.
@Anonymous12:27:
Both Skobir and Krašnja used to work at Ljubljana Airport while it was owned by Slovenian government and now German government. I guess they're able to achieve that by being friends and relatives to someone from Slovenian and German government at the same time. /sarcasm
ACI Europe revised its recovery forecast so these fears by LJU are more than justified. Small, regional airports stand to lose the most. In my opinion LJU could be a good FR/W6 base if they lower their fees and charges. That area is relatively underserved with both LJU and ZAG having limited LCC presence.
ReplyDeleteAviation is still a mess, the other day OS was banned from most of the Balkan countries which forced them to temporarily terminate ORD. SN Brussels moved the resumption of its long-haul flights by a week thus affecting some 7.000 passengers. On top of that their future is rather uncertain as they might become part of the new Ocean project (another idiocy by LH). If I was LJU, I would put greater emphasis on attracting the two only two airlines that seem relatively stable at the moment: Wizz Air and Ryanair.
Agree that LJU should do everything to get a major LCC to open a base. That also opens the question of how ZAG would be impacted as a result.
DeleteOne good thing for ZAG is that OSI has finally died and there are very little chances of it getting any serious traffic. That means that there is less competition within their catchment area. Now, to the east of ZAG, they have BNX and TZL to compete with.
DeleteIt's going to be a looong road to recovery, that's for sure.
DeleteWhile I agree that it would be smart to attract W6 or FR, I just don't see a market for them. How would they be able to have 90%+ load factor all year round on numerous routes from Ljubljana. I mean Wizz has turned Brussels Charleroi seasonal and suspended London from Ljubljana in the last year.
DeleteThat's where subsidies come into play. I am sure LJU, W6 and FR know that they can't expect phenomenal results until corona passes but with government and airport support they can achieve acceptable ones. In a way they would be placing the foundations for a future partnership. Ljubljana itself is not a big market but it does have an acceptable catchment area. This is what could be interesting for these airlines. Not to mention that LJU could become an LCC alternative for Zagreb. If people from Belgrade go to INI to catch a flight (250 km) then I don't see why people from Zagreb wouldn't go to Ljubljana to fly.
DeleteLF at this point is not critical, I think FR right now has a LF of some 40%.
The catchment area is not large enough for a LCC base in LJU.
DeleteFR did have flights to Maribor. They stopped after the subsidies dried out.
DeleteThen they don't have to start off with a base, they can expand the offer by introducing flights from other places. Both W6 and FR have numerous W pattern flights so LJU can be included from pretty much anywhere.
DeleteWhich LCC route could work from LJU for Wizz for example. Any ideas?
DeleteSlovenia has position itself as niche green upscale (culinary) destination, not like Ibiza mass market, quantity-based destination.
DeleteSo, it would be questionable if Slovenia would want this type of tourist.
RY and Wizz are in bad situation. Their economic model is based on mass transport of mid-lower income tourist population segment.
-Primary activity is party and mingle. Fantastic recipe for Covid outbrake (see Croatia).
-This population is again feeling the economic pain of this crises as it is more sensitive to wage reduction, there by potential tourist quantity in this sector will shrink the most.
-…
So many wrong statements and assumptions in Anon 12:30, I don't even know where to start.
DeleteFirst of all, Slovenia is absolutely not perceived as an upscale destination. It's a typical mid-tier Central European country - not too cheap, not too expensive. What distinguishes it is its nature and its compactness.
Also, the "mid-lower income tourist population" (just curious, how do you define it?) is by far the biggest source of income for European tourism overall. You cannot build the image of your country as a long-term tourist destination without this market segment.
Finally, Budapest is the absolute capital of Europe for party-and-mingle activities, and yet Hungary has one of the lowest number of COVID cases in Europe. So, the two are clearly unconnected.
Overall, you assume and project way too much.
https://www.forbes.com/sites/ambergibson/2019/10/07/five-reasons-to-visit-slovenia/#2c923a416186, https://www.slovenia.info/sl
Deletemid - average income , lower - minimal wage / spare income
I agree on Budapest.
Covid: So the reason for second wave of infections - public gatherings, party, pubs, beach partys, weddings that are reported on the media is not the source of infections ?
Actually, Anon 12:30 is spot on.
DeleteLet the market sort it out, no incentives not from my euro
ReplyDeleteIf you let the market sort itself out, I fear there will be no airlines left in LJU.
DeleteI know, but the airport management has said always dont Save Adria let the market sort it self out.Well now let the market sort it self out #karma
Deleteagree this 'saying' was started by Fraport Slovenia management
DeleteActually, a lot of commentators on ex-yu were saying 6 months ago how they would be better off without Adria. A lot of cheap flights to all sorts of destinations.
DeleteAnd the rest of us knew it wouldn't be so. But then again, some of us actually work in the aviation industry.
Yeah Adria blocked the growth and cheap flights to all sorts of destinations. #sarcasm
DeleteSo Fraport has asked for bailout money from the government and now it is asking for the government to provide incentives to airlines. Isn't Fraport supposed to be a multi billion euro business?
ReplyDeleteRight now and for the foreseeable future Fraport and EVERY airport and airline will be loss making businesses.
DeletePrivatize the profits, socialize the losses :) No one is saying they will have a revenue this year, but what happened for saving for bleak days. You know, saving, that thing everyone accuses citizens when they don't do.
Delete@Anonymous 09:30:
DeleteSpot on.
Where does Jansa stand on setting up a new airline?
ReplyDeleteHe obviously has no problem if the airline is from Orbanistan... so Wizzair is coming.
DeleteWhere did he say that?
DeleteUnder his government only hungarians are investing in Slovenia. Buying media and other companies...., so why Jansa and Orban wouldn't make even deeper friendship with Wizzair?
Deleteinteresting. same happened here in MK when we had the Orbanists in power but the question is: are Wizz really tied to the country politics? Im not convinced so much.
DeleteI cannot see the rightwinger be against a national airline but is everybody in his coalition up for it?
Wizz Air may not be tied to Orban but Orban does a lot to support a Hungarian business.
DeleteHow many airlines are flying to Ljubljana at the moment?
ReplyDelete9 if you don't include charter flights.
DeleteAir France, Air Serbia, Easyjet, Lufthansa, Montenegro Airlines, Swiss, Transavia, Turkish Airlines and Wizz Air.
DeleteBA and SN should start next month (hopefully).
Delete^ No, BA is delayed until September
Deletehttps://www.exyuaviation.com/2020/06/british-airways-delays-ljubljana-return_29.html
But LOT should start next month, if it's not delayed again.
DeleteTo be honest that is not a lot for a Capital City.
DeleteIt can get worse ... just look at Bratislava or Tallinn.
Delete@Marko, even in normal times there weren't more than 13-14 airline flying to LJU.
DeleteKeep in mind that LJU is surrounded by larger airports. So it's not easy for them.
DeleteEnough with this 'LJU is surrounded by larger airports'. It is surrounded, but so are bunch of other airports and they make it work. LJU could do better - by attracting more airlines, by not being b**chy about national carrier instead of making sure they have good relationship, and by giving pax better user experience. If people are willing to drive 6 hours so they can wait for the plane anywhere but at LJU, that says a lot.
Deletethey should change the strategy and give more opportunities to oneworld and skyteam! I know staralliance is the biggest one but unfortunately the connections with LH are due the situation not helpin enough, there is now space also for others.
ReplyDeleteThe thing that will kill airports and airlines are these uncoordinated entry restrictions.
ReplyDeleteLJU lost 5 routes this summer already. The government should act.
ReplyDeleteI'm sorry but what was the point of privatizing Ljubljana Airport is the government has to do all the work. To make things worse, LJU wasn't given up for concession, it was actually fully privatized.
ReplyDeleteGovernment should go ahead and set up a national airlines but base it at Maribor :D
DeleteI don't know if you've seen what's happening around the world, but governments are saving airlines with massive bailouts. Since Slovenia does not have an airline, it would be logical to provide funds for the county's main airport.
Delete@9.54 Greetings from TAV, lol
Delete^ True, same situation.
DeleteLJU is an expensive airport for its size and market potential.
ReplyDeleteAdria was also very expensive maybe thatswhy
Delete“It would be more economical and sensible for Slovenia to support large airlines with a diversified network"
ReplyDeleteHe is talking about Lufthansa of course.
Does Fraport own some shares in Lufthasa? Or the other way around?
DeleteDon't think so.
DeleteActually Lufti is not happy at all with Fraport for incentivizing LCCs to come to FRA.
DeleteThey moved a lot of flights and launched new destinations from MUC instead of FRA because of this.
Fraport and Lufti have the same majority shareholders so would think they are pushing its partners interest first.
DeleteThe way things are going, next LJU will ask the government to attract airlines.
ReplyDeleteManagement of Fraport Slovenia has already stated that
Delete“its expensive handling fees are not the reason why other airlines bypass LJU but because Slovenia has no product for the tourists”
But one thing is for certain they are masters of their craft.
sure hahahhaha
DeleteThis would be great news for airlines flying to LJU.
ReplyDeletePrivatize the profits, socialize the losses. Who needs quasi private (Fraport) firms with their truncated profit distribution...
ReplyDeleteI absolutely agree with you. First they have to sack whole management, because they are incompetent. It was easy money back then, when AA was making up to 60 daily flights on average and Airport/Fraport didn't move a finger to make any improvements. Now when shit has hit the fan, they want bailouts. This is just a result of mad right-wing politics which is against state ownership of strategic assets. Just observe, as Fraport will close down Ljubljana eventually if the losses continue to amount. Don't fool yourselves with new terminal. If asset leaks money long enough, they will shut down the whole operation. And then we will be in the banana.
DeleteSo what. The land is owned by the government. If Fraport shuts down the operations it will not be paying the building right compensation, therefore it is in breach of contract, therefore the government can terminate the agreement and the buildings revolve back to the government.
Deletelet the market handle the traffic. frapy will do their fault-proof calculations and see it's time to part ways.
Delete