State to assist Air Serbia with Etihad Partners debt


The Serbian Minister for Finance, Siniša Mali, has said the government will assist Air Serbia with the repayment of two loans, valued 52.9 million US dollars and 63 million dollars, noting that the carrier is of national interest. The airline, which unsuccessfully attempted to reduce the repayment of the loans by 82% each, will see the first of the two mature next month. Mr Mali, who was the Chairman of the Air Serbia Supervisory Board at the time the loans were issued in 2015 and 2016, said, “We are negotiating with the creditors. While I can’t reveal the contents of those talks, I can say that we will certainly help Air Serbia. We are working towards resolving this problem together with our partners at Etihad Airways”.

The two loans were issued by two international funding vehicles comprised of local and international investment funds named Etihad Airways Partners I BV and Etihad Airways Partners II BV. They distributed 700 million US dollars in loans between the national carrier of the United Arab Emirates and its equity partners for a mixture of capital expenditure and investment in fleet, as well as for refinancing. This June, Air Serbia informed the funding vehicle that due to the financial strain caused by the coronavirus Covid-19 pandemic it may not be able to meet its obligations and payments. It proposed revised amounts and loan repayment deadlines.

Commenting on the government’s plans to financially assist Air Serbia in the coming period, Mr Mali noted over the weekend, “All carriers across the world are in an extremely difficult position. Our Air Serbia is no exception. This is likely the biggest crisis ever faced by the aviation industry, and, as a result, states must help their airlines. Due to the pandemic, and the corresponding economic crisis, the European Union has adopted new state aid rules. The rules have been significantly relaxed and enable the state to help improve the liquidity of companies which have been particularly affected by the coronavirus crisis”. Mr Mali added, “The Ministry for Finance has adopted two protocols, through which we have harmonised our regulations with the abovementioned European directives. Therefore, Air Serbia is a company of national interest and the state will help it”. Air Serbia was the beneficiary of 19.7 million euros in state aid last year.

Comments

  1. Anonymous09:01

    Expected

    ReplyDelete
  2. Anonymous09:02

    And some people here were claiming how they wouldn't help.

    ReplyDelete
    Replies
    1. Anonymous09:04

      Why wouldn't they?

      Delete
    2. Anonymous09:06

      Wishful thinking by some who are still hoping for JU's demise.

      Delete
    3. Anonymous09:18

      I for one certainly don't wish for JU's demise. HOWEVER, as with any state asset, you have to stop and ask the question if there is another (better) way ....

      Gosh that's alot of money over the past 6 years and still no new aircraft to show for this massive investment

      Delete
    4. Anonymous09:24

      Love this fake compassion for JU. So you take a look at their books, see increased passenger numbers, increased tourism arrivals, reduced losses and subsidies from the government... and the first thing that crosses your mind is we should put an end to this?

      Sure.

      Delete
    5. Anonymous09:29

      Reduced losses and subsidides? Can you prove what are you saying?

      Delete
    6. Anonymous09:33

      I don't have to, all this information was regularly published on this website. All you have to do is do some research.

      Delete
    7. Anonymous10:03

      Ive done it long time ago and what are you saying is not true by informations I have so please can you prove what are you saying?

      Delete
    8. Anonymous10:04

      In reality nobody outside JU and GoS can count the FULL amount of subsidies now and in the past, so commenting is very difficult.


      Direct subsidies (disclosed at 19,7 mln euro last year)

      +

      Marketing contracts with the government like 'Serbia Creates Livery'

      +

      Potential subsidies by way of PSOs (remuneration from GoS to be compared to real costs and a reasonable margin)

      +

      BEG volume discounts (guaranteed by the GoS under the concession agreement with Vinci - if those would not be indirect subsidies, there would be no reason for GoS putting an obligation on the concessionaire to upkeep the current fee structure for some additional stipulated time - and pls note that on EU airports there are discounts for opening new connections or for growth in traffic or for transfer pax, but not sheer discounts for volume of traffic)

      I am neither in favour nor against subsisies. I don't claim that other airlines don't get subsidies. I am not even saying the full amount of subsidies should be disclosed by GoS or JU. I am ONLY commenting on the amount of the subsidies.

      Delete
    9. Anonymous10:38

      And subvention from Tourist Organization of Serbia.

      In 2017 it was huge 17 million EUR, but after that you can not find in financial report how much they give to Air Serbia, and for sure they give money.

      Delete
    10. Anonymous10:39

      Anon 10:04
      Great post!

      Delete
    11. Anonymous10:41

      Anon 10.03 there was literally an article on it this month regarding JU reporting a profit for 2019. That should be a good start for you.

      Delete
    12. Anonymous10:50

      In comparasion of 2019. to 2017. they made 6 million less "profits" while they recive 1,3 million less aid. So I will ask you for the third time, can you prove what are you saying?

      Delete
    13. Anonymous11:20

      Yes.

      Delete
    14. Anonymous12:07

      Then prove it.

      Delete
    15. Anonymous12:36

      Anonymous 10:41
      That article was so funny! Seriously, stop embarrassing yourself.

      Delete
    16. Anonymous15:54

      Aha ok so it's funny and I am embarassing myself because the article isn't saying what you want it to say. Your story is getting old. It's been what, seven years almost, time to move on.

      Delete
  3. Anonymous09:02

    Considering he says that they are working with EY, I guess they are still in the picture.

    ReplyDelete
    Replies
    1. Anonymous09:08

      What else could he say ?

      Delete
  4. Anonymous09:04

    Of course they will.

    ReplyDelete
  5. Anonymous09:05

    This will be the huge aid... I just wonder if that means that this year will be in a huge profit in future financial report?

    ReplyDelete
  6. Anonymous09:05

    It's crazy how much money is being spent on this airline.

    ReplyDelete
    Replies
    1. Anonymous09:05

      9 billion EUR to LH. That's crazy

      Delete
    2. Anonymous09:07

      You mean less and less money every year? Didn't OU get €33 million while being much, much smaller than JU?

      Delete
    3. Anonymous09:14

      Air Serbia received a EUR380M debt writeoff at the start; then received $100M from both shareholders; got this loan of $115M and then subsidies every year over the past 6 years - maybe another EUR100M in addition to the PSO subsidies + however much it will need going forward from this point onwards.

      That's an awful lot of money for a 20 aircraft airline

      Delete
    4. Anonymous09:18

      https://seenews.com/news/air-serbia-to-add-1-bln-to-national-output-in-2016-survey-534656

      Delete
    5. Anonymous09:20

      Interesting how you don't say that subsidies have been going down each year. Not to mention that Air Serbia wasn't launched from scratch but rather it was a successor of collapsing Jat Airways. Company rose like a phoenix out of the ashes of its predecessor and is actually managing to compete efficiently on various international markets. It's the only ex-YU airline that's proactive and that responds to market dynamics and doesn't consider any time to be too early to react. How much money did Dubai invest into EK before they became what they are today? You obviously don't work in the private sector because if you did then you would know that there is always a period of time which is needed for a business to consolidate before there can be a solid ROI.

      People here expect JU to become profitable after just one year. If you are so smart and an expert then join the airline and show them how it's done.

      Delete
    6. Anonymous09:21

      LH may have received 9 billion, and other carriers too, but let's not mix the two: the others received aid due to the Corona crisis, and this loan Ju (and now as usual the GoS) will have to repay has NOTHING to do with Corona

      Delete
    7. Anonymous09:23

      Anon 09.18 please don't share such things because it ruins the much loved rhetoric on here.

      Delete
    8. Anonymous09:26

      Anon 09.21 you are wrong because JU can't repay it BECAUSE of corona. They paid without a problem the interest in March. Maybe they wouldn't be able to pay the whole loan back themselves but they probably could at least half. Thanks to corona now they can't even do that.

      Delete
    9. Anonymous09:33

      Stop comparing aid given to the literally EVERY company in EU with aid given to the money losing carriers every year. Even if you are selling cabage in Koprivnica you will get somethnig from the state because of current situation. So aid given to the every airline in EU because of lockdown is not a excuse for money given to the unsuccessful state owned carriers?

      Delete
    10. Anonymous09:38

      "People here expect JU to become profitable after just one year. If you are so smart and an expert then join the airline and show them how it's done."

      It is 100% imposibile to make profits in the first year, or second one, but still how much years does JU needs to become a profitabile airline? We are waiting for 7 years now and it seems we will wait at least 10 more...

      Delete
    11. Anonymous09:47

      Technically year zero is the one when Dane left and when key depratments were moved to Belgrade from Abu Dhabi. That's when we start counting.

      Delete
    12. Anonymous09:50

      LH received 9 bln euro, but Germany's GDP is 96 times bigger than GDP of Serbia.

      So 116 mln euro for Serbia, taking into account the difference in size of the economies, is equivalent to Germany spending 11,2 bln euro on LH.

      Delete
    13. Anonymous10:04

      But Lufthansa is not 96 times bigger than Air Serbia.

      LH has 277 airplanes in their fleet. 9 billion / 277 = 32,5 mil per plane
      JU has 20 planes. 116 mil / 20 = 5,8 mil per plane

      Delete
    14. Anonymous10:07

      115 millon is not an aid given to the JU. Its just an amount of money that goverment is going to pay for JU because it is not able to do so. Aid given to JU will probably be higher than that.

      Delete
    15. Anonymous10:23

      Anon 10:04.

      I was making a comparison based on GDP of the respective countries to show how big is a given expenditure for the respective countries granting that aid. Pls also remember that part of LH financing goes by way of loans to be repaid by LH to Germany.

      If you want to compare how much it is for the respective airlines, the approach would be different. Number of planes doesn't realy matter as planes can be big or small. It would be about income (revenue) or ASK.

      Delete
    16. Anonymous10:33

      9 million aid given to the LH is not only for the LH mainline but and for LH regional, Air Dolomiti, Sun Express, Eurowings, LH Cargo, LSG Sky Chefs, Lufthansa Consulting, Lufthansa Flight Training, Lufthansa Industry, LH Solutions, Lufthansa Systems, Lufthansa Technik, Global Load Control. So it is more then for just 300 aircraft. And LH has about 140.000 employes which is also important factor.

      Delete
    17. Anonymous10:37

      And are we going to take into consideration the billions LH got from the government before deregulation? Unlike JU they never had to consolidate and reach profitability during a massively deregulated market.

      Delete
    18. Anonymous10:44

      LH Group revenue 2018: 35.8bn. 9bn government help = 25% of yearly revenue
      Air Serbia revenue 2018: 290m. 98m government help (converted to EUR) = 33.7% yearly revenue

      Not to mention that LH Group actually made profit for 13 of the last 15 years, and of the 2 loss-making years total loss was 56m EUR. Profit in some years exceeded 2bn.

      Please don't compare Air Serbia with Lufthansa.

      Delete
    19. Anonymous11:23

      Crappy Tarom got so much more than JU did while offering so much less. It's obvious so many people on here dream of either bashing JU or seeing it die. I guess the trauma from 2013 has caused deeply rooted effects. It truly is depressing that each time there is a topic on JU vultures come flying in to spread the usual hate. Like someone wrote, even Hungary eventually realized what mistake they made by letting go of MA. Same with the Belgians or Austrians who insist on having national airlines even though they are loss making dumpster fires.

      Delete
    20. JATBEGMEL13:32

      What also hasnt been taken into consideration is the fact that the airline is still recovering from the fall of Yugoslavia.

      JAT had profitability just before the collapse of Yugoslavia. The airline lost its complete domestic market, sanctions kicked in, the fleet intended for the Yugoslav market grounded and even seized, hyperinflation, NATO bombings in 1999 where the fleet was sent wherever possible. This isnt what any other European carrier has faced. Add to that another decade with an inflated fleet and staff count (JAT still had DC9's, B727's and a DC10 until 2005), government appointed CEO's who further mismanaged the airline. The past 20 years there has been too much government interference into the airline that keeps it from being profitable. Problem is not the airline, problem is government mismanagement, as evident with the article above.

      Comparing LH and JU is useless. LH had alot more favourable conditions for growth and profitability, benefited for decades with government support, ability to acquire new and efficient aircraft and technologies, took advantage of the opening of the Eastern European markets to further develop their network while being based in a country with amongst the worlds largest economies...and still needed a multibillion euro bailout.

      Delete
    21. Anonymous14:24

      JATBEGMEL

      DId you just translate here the post of ju350?

      https://www.skyscrapercity.com/threads/air-serbia-planovi-destinacije-avioni.1649881/post-169469475

      Delete
    22. Anonymous15:56

      JATBEGMEL thank you, unfortunately some people don't really want to understand or see what this all is really about. They would rather attack and trash JU no matter what.

      Delete
    23. JATBEGMEL excellent explanation!

      Delete
    24. Anonymous16:27

      I really don't understand why all this fuss about JU is needed. Just freaking look at Slovenia! When you're left at mercy of the market and foreign airlines to dictate your air traffic and connectivity, you get what they're having right now. A national airline is more than profits. Most airlines make very small profits if any at all. The amount of money that JU could potentially make is irrelevant actually. The purpose of a national airline is to serve the people, to upgrade communications with the world and to develop the economy of it's homeland. You cannot know how much money indirectly this airline brings into the country, and yes, don't forget that the world struggled to meet the cargo demand during these last few months. It's good to have a few planes back at home sometimes.

      Delete
    25. Anonymous18:02

      @11:23 crappy Tarom? LOL!!
      They are so crappy that they are a SkyTeam member, renewing it's fleet and has a domestic network combining BEG-MNE and INI traffic all together.
      Still offers free catering on board. Anything else to say?

      Delete
    26. Anonymous18:54

      "don't forget that the world struggled to meet the cargo demand during these last few months. It's good to have a few planes back at home sometimes."

      There were (and still are) thousands of aircraft available for cargo charters all around the world. Just have a look at pictures of all the aircraft parked even on the runway in FRA, etc.

      I'm pretty sure most airlines would be quite happy to fly some cargo around, should request and payment come their way.

      Delete
    27. JATBEGMEL22:08

      @ 14,24

      I did see that comment, no its not a full translation, however I absolutely agree with it. This is definately an aspect that is never mentioned when talking on JU, so thanks for sharing the link for all interested to read in full.

      @ 16,27

      Absolutely correct. Connectivity today means alot. Although SKP has/had a decent Wizz base, North Macedonia had amongst the worst connectivity rating in Europe. MAT wasnt anything special to regret losing either.

      @18,02

      If Im not mistaken, Im sure RO removed the free onboard catering and went the hybrid model earlier this year when they had financial issues, needing almost 200 Million Euros of government support.

      Delete
    28. Anonymous05:08

      JatbegMel,
      But we do agree about the rest? RO is quite often underestimated here. It is still alive in spite of having a real tough competition with 3 more carriers in its homebase. Now put Wizz, Ryan and another Serbian LCC and let's see if JU will survive.

      Delete
    29. JATBEGMEL11:05

      @ 05,08

      Kind of. Its alive because of a government injection. Their losses the past couple of years are 3 times what JU made. So far, JU has reacted well to LCC competition, a good indication will come next year when Wizz finally launches its new destinations from BEG.

      RO could do alot better than it does. Being a Skyteam member and offerinng 'free' catering doesnt make it a quality carrier.

      Delete
    30. Etihad is low on cash but FULL of unused airplanes and other equipment! If it can't match the Serbian government contribution to reducing the debt, it can do so with replacing rentals with an addition of younger planes to the fleet. This will save JU money in the long term and invest for 2021 onwards.

      Delete
  7. Anonymous09:05

    Government signed off on these loans so it's only logical for them to fix the mess. Btw the loan payment JU made in march, was it part of this EY mess or something else?

    ReplyDelete
    Replies
    1. Anonymous09:07

      Yes, they were paying off the interest on the loan.

      Delete
    2. Anonymous09:16

      Thank you, that means JU was liquid enough before corona

      Delete
    3. Anonymous09:31

      It was only liquid due to annual govt subsidies

      Delete
    4. Anonymous09:33

      Constantly reduced government subsidies, please be specific my friend. We went from €74 million in 2013 to €19.7 last year. If thta's not fantastic then I don't know what is.

      Delete
    5. Anonymous10:12

      Compare 2017. and 2019. and you will see a true financial results. They got 21 million aid in 2017. while in 2019. they got 19,7. In 2017. they made 15,7 million "profit" while in 2019. they made 9 million. So they made 6 million more losses with 1,3 million less aid. Not improving at all...

      Delete
    6. Anonymous10:37

      It actually is improving, check again.

      Delete
    7. Anonymous10:49

      No, they are not getting less. There was different way of subvention, like Tourist Organization of Serbia which gave 17 million EUR + PSO which was not on principal of EU (cost every month + 5% profit - income of the route). And on top of that you have to put this 110 million USD which was spent in last 5 years (so that is another 20 million USD) and will be paid by government. So, till 2017 there was around 40 million EUR per year, and after that even more.

      If Serbia want Air Serbia to survive it must pay:
      - 100 million for this loan
      - 20 million for "regular help" by Government
      - 17 million for "regular help" by Tourist Organization
      - 3 million for PSO
      - 80 million for extra Covid-19 help

      = some 220 million EUR

      Huge!

      Delete
    8. Anonymous10:49

      Ok, than prove me If i dont know any maths.

      Delete
    9. Anonymous10:52

      Can you prove anywhere this subsidy by the Tourist Organization? They got 19.7 from all donations and aid in 2019. It's in their financial report. Just because you repeat a thousand times they got something from the tourist organisation does not make it true.

      I also find it interesting that you already know how much they will get in Covid-19 help. Or you saw it in your crystal ball?

      Delete
    10. Anonymous10:55

      Magic bowl is saying to me that the next opposite side argument will be consisted of 2 capital letters.... O and U.

      Delete
    11. Anonymous10:56

      Ok, so your follow up comment just proved you can't prove anything and you are talking absolute nonsense. Thanks for the confirmation.

      Delete
    12. Anonymous11:24

      There are many other two letter examples of you don't like that one: AZ, SN, OS, RO...

      Delete
    13. Anonymous15:07

      In 2017 they gets 12 million, in 2018 17 million from Tourist Organization. But this year we have to wait for Tourist Organization report to see how much they get. But I know the fact they get some money from that source.

      Delete
    14. Anonymous15:08

      Even without that 17 million it is still 203 million EUR for 2020.

      Huge!!!!

      Delete
    15. Anonymous15:12

      Show me where did they get 203 million from and from what you deduced they are getting 203 million from other than your crystal ball? Putting numerous exclamation marks is not evidence they are getting 203 million something you can't even know because you have no clue how much the state will assist, you have no clue how the debt will be restructured, you have no clue if they will receive PSO funds etc. So cut the crap.

      Delete
    16. Anonymous15:17

      He randomly picked a number and now he is pushing it as if it is a matter of fact and not a product of his imagination. Just let him be.

      Delete
  8. Anonymous09:07

    How ironic that Mali who created this problem in the first place by agreeing to it, is now the one to 'rescue' the carrier with this loan repayment ....

    ReplyDelete
    Replies
    1. Anonymous09:08

      The only issue is he isn't rescuing it with his own money.

      Delete
  9. This was the only sure thing.

    ReplyDelete
  10. Anonymous09:10

    This "pit" remains bottomless ....

    I trust that one day, someone calculates the total cost of this endeavour. However, we will probably need to wait for a change in govt to eventually find that out

    ReplyDelete
    Replies
    1. Anonymous09:21

      Imagine if people of Dubai or those in Istanbul thought like you. Posts like yours show why the Balkans will never be a business hub. Experts at bitching, that's all.

      Delete
  11. Anonymous09:11

    State aid was under normal circumstances not possible for EU carriers. They had some limitations but they also had some rights non EU carriers did not have.

    Now we have the situation that non EU carriers still do not have the rights which EU carriers have (for example flying routes where arrival and departure airport is not in their country) but EU carriers got the right to be financially helped by their Government.

    Why do we have than to be so surprised that non EU carriers just kept their right to be financially helped by their Governments?

    ReplyDelete
    Replies
    1. Anonymous13:52

      I will surprise you! Serbia is part of the ECAA. Therefore JU has the same rights and is subject to the same restrictions as for example LH.

      For example JU, if it only wanted, may fly on scheduled flights between Romania and Bulgaria, or between two domestic airports in Germany. Under ECAA agreement JU is also subject to the same rules of public aid as LH.

      Delete
    2. Anonymous13:55

      Your 'surprise' is completely false. Air Serbia can not fly between two EU member states. Educate yourself.

      Delete
    3. Anonymous15:37

      Anon 13:55: in your total ignorance, you even don't want to learn. Of course JU may fly, also on scheduled flights, between two EU countries or domestically within these countries. This is what law says. They don't fly because it makes no economic sense for them.

      Here is the easiest source: https://en.wikipedia.org/wiki/European_Common_Aviation_Area

      Delete
    4. Anonymous15:49

      Yes I would read your wikipedia source again. That is the final target of ECAA but it is far from being implemented and is not even close to reaching that stage. As someone who knows a bit about aviation regulations I'm telling you that what you wrote is incorrect. Air Serbia can't fly between two EU states let alone domestic flights in an EU state.

      I will just remind you that your country's regiuator was blocking Air Serbia from flying into your country because it was selling transfer tickets via Belgrade, which is ludicrous on its own but no, Air Serbia ot any other non EU airline can't fly domestic flights between EU member states.

      Delete
    5. Anonymous16:09

      So if he is saying something against JU he is automaticly a Croatian citizen? Very nice conversation... +1000 to you.

      Delete
    6. Anonymous16:09

      Anon 15:49:

      Short internet searches are often misleading. You are mixing Common Aviation Area Agreement signed by EU with Georgia with EUROPEAN Common Aviation Area Agreement signed among others with Serbia. The former foresees opening of an aviation market in stages, many of these stages yet to come, the latter already provides all freedoms that I mentioned to any carrier from ECAA. Read the ECAA agreement, if you doubt.

      Finally you also incorrectly mix flying within ECAA with flying from ECAA to a third country (like flying by JU from Bulgaria to US). This is not covered by the ECAA agreement.

      Delete
    7. Anonymous16:10

      Croatia didn't allow Air Serbia to fly charters from Oaijek in 2018. So much for that.

      Delete
    8. Anonymous16:11

      *osijek

      Delete
    9. Anonymous16:13

      I wasn't saying anything against JU. I wish them the best. I was just discussing ECAA agreement and whether JU may fly on scheduled flights from one EU country to another EU country or withing a EU country domestically. How can that discussion be against JU? It is totally neutral.

      Anon 13:52

      Delete
    10. Anonymous16:14

      @16.09 he admitted so himself in another one of his rants through his numerous comments today.

      Delete
    11. Anonymous16:18

      @16.13 it simply isn't true.

      Delete
    12. Anonymous16:40

      Croatia didn't allow Air Serbia to fly charters from Oaijek in 2018. So much for that.

      That is not true at all. JU never wanted fly charters out of Osijek and they never ask premision for it. That is just a rumor from the anonymus comment 2 years ago. It was not even reported on this blog or any other.

      Delete
    13. Anonymous16:41

      @anon 16:10

      Do you have any link supporting it?

      Thank you.

      Delete
  12. I personaly was expecting help by the Serbian gouvermant a bit earlier as most US and EU companies got financial boost almost 2 months ago . Global airlines are seeking billions in financial support , unfortunately since Covid19 situation is continue, I am expecting some airlines to look for gouvermant aid not just ones but multiple times. Positive note, I was on JU360 flight yesterday morning to AMS and flight was almost full . Bigest suprosed to me was full business class . Definitely think JU is not doing bad as some bigger national airlines.

    ReplyDelete
    Replies
    1. Anonymous09:23

      Don't forget JU got aid from the government for the charters they ran during the lockdown. If there was no JU I guess you would have had to fly on Wizz Air to that remote village called EIN.

      Delete
    2. Imagine calling EIN that has 5x the GDP of BEG a "remote village".

      Delete
    3. Anonymous10:27

      Vlad, you can tell that he was not near EIN or read anything about the city, as he’s calling it a village. Airport itself is super super nice, while the city is really charming and cute. Why does everyone think that people use EIN to reach Amsterdam only?

      Delete
    4. Anonymous11:36

      oh @9.23 is the one troll that is posting on every article here (keywords - village, high density, demise, notorious)

      EIN had 6.7 milion passengers in 2019. Oh wait Its that more then the biggest airport in ExYu?

      Delete
    5. Anonymous16:00

      It's a village compared to AMS which is a prime airport. Imagine how insignificant other ex-YU airports are if EIN is bigger than the biggest one in ex YU

      Delete
    6. Anonymous21:19

      @16.00 is defo the same guy @9.23.

      and Imagine how insignificant the biggest airport in ExYu if it is stil smaller then airports in remote villages in Netherlands

      Delete
  13. Anonymous09:23

    The comments here sometimes sound unreasonable. The tourism/airline/service industries worldwide are facing with unprecedented situation. Governments as well. It is only natural for everyone to do their best otherwise in six months there will be no airlines, hotels, travel agencies, etc.

    What would happen to the European railroad network if it hasn't been so heavily subsidized? Or the highway infrastructure? Connectivity is everything in modern business environment.

    I am not talking local politics here but if Serbian government has decided to have a proper airline and have some benefits from not actually being in the EU, this is the only way. And, from my personal point of view it works. The international corporation I work for placed Belgrade on the map to develop one of their very few European HQs exclusively because of connectivity which we proved is better when compared to Ljubljana or Bucharest. Thank you Air Serbia.

    Regards,
    Eight

    ReplyDelete
  14. Anonymous09:29

    They intentionally forgot to mention for SEP payment, plus 20 MIl interest. And for Next Year, 22 mil interest.Total 140 Mil,all fleet worth it less.
    And still paying rent of aircrafts.
    To whom do we pay?
    Is it private company,Mali and partners,?

    ReplyDelete
  15. Anonymous09:29

    If the govt chooses to step in and support the airline as they have been doing all these years - that for me is ok and fair enough. But, they need to stop with the charade of reporting annual profits and instead, be much more transport with the true financial performance of the company.

    ReplyDelete
  16. Anonymous09:31

    Haha surprise surprise, I wonder if there are some cashbacks for selected politicians from this shady financial endevour?

    ReplyDelete
  17. Anonymous09:36

    Even Hungary realized that killing off Malev was the wrong move and that Wizz Air couldn't fully compensate. That is why the government is paying LO to slowly recreate the old hub system MA had. Obviously this show national airlines have a massive benefit for the local economy. After all, JU was the first to resume IST and already in June Turkish arrivals started to recover. Without them we would have to wait for Turkish carriers another month and a half for that to happen.

    ReplyDelete
    Replies
    1. Anonymous09:44

      +1

      Delete
    2. Anonymous12:09

      +2

      Delete
    3. Anonymous12:12

      I agree. I simply just can't believe JU didn't fly to IST for several years - but now IST seems like the most important destination for them. Also codeshare signed with TK, which is the most important thing here. JU can benefit TK's +350 destinations over IST in the future.

      Delete
  18. Anonymous09:36

    The ASL business plan is clearly loss making.
    The airline despite massive amounts of subsidies and loans in nowhere near breaking even and they have fleet modernization needs in the near future coming up.
    Maybe, just maybe they should concentrate on why the airline was loss making at a time that all other European airlines were profitable. Make structural changes to the operation to bring it to break even point after the Corona crisis has passed.

    Just my2ce3nts

    ReplyDelete
    Replies
    1. Anonymous09:49

      That's what they did once key departments were moved to Belgrade. How could they do it before when they were not in charge of pricing or their network? Once that was moved to Belgrade airline started to consolidate and to record improved numbers in every possible way.

      Delete
    2. Anonymous09:58

      Anon@9.49 - all this proves is that we didn't need EY in the first instance if things only really started once key depts were moved to BEG. Expensive way to find out that we were always able to do it ourselves, right ? So where did all the money go in those first 5 or so years ?

      Delete
    3. Anonymous09:59

      JU's inability to even pay its loans despite the new subsidies for INI and KVO operations tells otherwise.

      Delete
    4. Anonymous10:00

      Those subsidies are used to cover the costs of those flights... That is their purpose. Not to cover loans.

      Delete
    5. Anonymous10:14

      @Anonymous 10:00
      LOL, sure they are just to cover the costs of these flights!

      Delete
    6. Anonymous10:14

      So 2,5 million euros for this and next year for aprox. 4 weakly flights with 66 seater? It seems more like aid then PSO.

      Delete
    7. Anonymous10:48

      And how do you call the fact that Croatian Government provides PSO in amount of 599 EUR per passenger for flight OSI-ZAG?

      Delete
    8. Anonymous10:48

      Croatian government also subsidizes OU through the PSO program. Everyone knows that. It is you that is denying that the Serbian government does the same thing with the INI and KVO flights.

      Delete
    9. Anonymous10:49

      Same I can say for OU aid and OSI PSO (it cannot be an aid because it is given to the private owned company) which is quite funny to the every citizen of the Rebublic of Croatia. So are you concerned about fake PSO in your country or you think that is fine?

      Delete
    10. Anonymous10:53

      I call this stupid! But for sure it is not excuse to make same stupid move in Serbia.

      Bur in Croatia this stupid route is for Trade Air to fly empty plane and can not get any extra benefit from it (cost - income + 5% profit, not a cent more), and not to Croatia Airlines.

      Delete
    11. Anonymous10:57

      No Croatian Goverment is not subsiding OU through PSO because it is 10 euros per seat. OU is only subsided throught different illegal methods, like loan of 33 million...

      Delete
    12. Anonymous11:17

      Even CEO of Trade Air is saying how PSO route from ZAG to OSI is really unuderstandable. I dont know even why goverment is giving money for that route if nobody is flying on it.

      Delete
    13. Anonymous11:38

      good that you both have come to the same conclusion ^^. OU and JU are heavily subsidized

      Delete
    14. JATBEGMEL12:49

      @ anon 09,36

      The JU business model is not loss making. Its government meddeling that has been expensive.

      Jat needed big time investment, which definately needed to come from public funds. However, the governments way of rebranding and restructuring the airline was shown to have been incorrect and unnecessarily expensive. This all could of been done domestically. While Serbia has alot of its skilled workforce leaving the country seeking employment and opportunities, key departments for 5 years was in Abu Dhabi, where an incorrect business model was put into place, with key decisions made from people who do not understand the Serbian and European markets, expensive loans given along with inflated prices on leased aircraft. Not to mention government intervention in getting the airline to make expensive adventures without a solid plan/stratergy ie JFK.

      So no, its not the business model, its government incompetancy that is the issue.

      Delete
    15. Anonymous13:39

      What are you on about JATBEGMEL? The GoS along with Etihad developed the business model that JU is following for the last 7 years. THAT is the business model, there is no other that is actually profitable.
      IF and that is a big if the Government who is in charge alone for the last 2 years devises some other business plan then we can discuss about it. But the one that exists today has been proven to be loss making.

      Delete
    16. Anonymous16:01

      JU has not been following the same business model for the past 7 years. For about five years there was no business to follow, just pure chaos.

      Delete
    17. JATBEGMEL22:38

      @ 13,39

      If you havnt noticed, Air Serbia went from the intial full service carrier developed by EY to hybrid in 2017.

      https://www.exyuaviation.com/2017/05/air-serbia-in-strategy-shift.html
      https://www.exyuaviation.com/2018/01/air-serbia-completes-hybrid-transition.html

      2019 was the first full year since the implementation of the new hybrid model. It was also the first time that JU saw a large expansion since the rebranding, while another was due this year, along with changes to the fleet (in fact, both A319's are still in TLS in the JU livery). Fact is that JU went from a loss of over 40 million euros in 2016 to around 9 million in 2018 and 2019.

      My opinion is that finances will not improve much without further investment in the fleet and network, as seen with LO and BT for example. Without looking a numbers, I would say that the 2 pw JFK rotations makes a nice part of their loses. Compensation for delayed pax in 2018 amounted to 1,2 million euros, roughly 15% value of the loss JU made that year. Both of those have nothing to do with the business model.

      https://balkaninsight.com/2020/02/12/letovi-koji-kasne-er-srbija-se-suocava-sa-pitanjima-kapaciteta-i-kvaliteta/?lang=sr

      So again, no, its not the business model.

      Delete
    18. Anonymous05:20

      I would not compare apples with pears. Today's JU should actually be called NJU or new JU because it is a completely new company and has got absolutely nothing to do with Jat Airways or JAT. The IATA code has been inherited but that does not make it the same company. In Europe, the sole good example is Swissair to Swiss International, but still it's really not the same company. The new JU is a child of EY just like LX is a LH child. I would definitely stick to ASL because this airline was born 7 years ago and has a completely different product, brand and logo.

      Delete
  19. Anonymous10:30

    Everybody is so focused on which Balkan country is subsidizing more, which ex-yu airline is worse etc... While looking just at that and fighting who has the bigger ** we dont check where the money is going, and the politicians are rubbing their hands.

    Remember guys where we live, there is no way that big amount of money, in all our countries, can go around without some politicians stuffing their pockets. Would love to see this investigated if there are some investigative journalists left. Maybe KRIK but they seem to have their hands full with other stuff.

    ReplyDelete
    Replies
    1. Anonymous10:42

      +1000

      Delete
    2. Anonymous11:45

      I remember when that one agency made a groundbreaking report on JU reform but in the end they couldn't even get the name of the predecessor right, they always wrote JAT.

      LOL!! So much for professionalism.

      Delete
    3. Anonymous15:36

      It's scary how little these independent/investigative media know about aviation. But what's more terrifying is that I trust them on other topics where my knowledge is not sufficient to make my own judgements like I can on aviation topics. So if they are making so many mistakes and purely have no clue how aviation or anything related to it works, who says they are not making the same mistakes/basically lying for everything else?

      Delete
  20. notLufthansa11:11

    well, if you don't want to have only 4 legacy carriers, 4 LC and handfull of feeder airlines, you need to support national carriers.

    ReplyDelete
  21. Great move by the GoS. AirSERBIA is the only exyu airline with a stabile and bright future. If it wasn’t for corona, this year would be JU year. They have consolidated, they are expanding and they are actually making profit.
    Would love to see JU making bases in Banjaluka and Podgorica/Tivat and Pristina and become the flag carrier of all Serbian lands.

    ReplyDelete
    Replies
    1. Anonymous11:40

      +1000

      Delete
    2. Anonymous11:44

      I think BNX would be great because they already operate charters there and are very successful. Introducing several destinations on the ATR would be fantastic: ZRH, STR and HHN come to mind.

      Delete
    3. Anonymous11:51

      "they are actually making profit."

      Not without the government subsidies every year. Looks nice on paper though.

      Delete
    4. Anonymous12:10

      Between the carrier that is rapidly losing its market share on domestic, very popular, touristic market, makes copy/paste of its previous flight plan and still receives Government help and the carrier that also receives its Government help but increase network, fleet and the only one fly TATL without any second thought I choose the second one.

      Delete
    5. Anonymous12:21

      11:23

      You really do not understand aviation when you are metioning how great it would be for 21 aircraft legacy airline to make more bases and destroy their own hub and spoke model. And no, there is no such a thing as successful state owned carrier in this region. Same as there is not state owned carrier with the "future" whatever that means. There are actually some successful private owned airlines like Trade Air, Amelia or Solinair but still we will not see successful state owned legacy at least for more 5 years. Air Serbia is not making profit thanks to "good strategy", "great managment" or something else but thanks to goverment which is ready to give them every year at least +20 millions...

      Delete
    6. Anonymous12:24

      You can become the flag carrier of whoever you want, but you might want to remove PRN

      Delete
    7. JATBEGMEL12:34

      @ anon 12,21

      I agree on your comment on the bases, and as usual with Parti, his comments are more on the line of cheerleading without putting thought into what he is writing.

      As for the profit part, it is the governments decisions that are affecting their finances. EY management, the above mentioned loans, JFK, INI base...

      Delete
    8. Anonymous12:48

      lol @Парти

      Delete
    9. Anonymous12:54

      INI base might even help through "PSO" because they operate about 20 weakly flights for 10 million I think but you are right about other things. Same is happening in Croatia because goverment doesnt care about currently employed at OU. But still JU managment can also do something in terms of loss cutting, like introducing regional jets, leasing new ATRs 72-600 removing 737s... There is definitly place to improve...

      Delete
    10. Anonymous22:52

      You have total mental breakdown if you find Podgorica or Tivat as Serbian land.

      Delete
  22. Anonymous12:18

    Despite all the negative intentions of some people here JU is going to live and continue from the same point where pandemic stopped it!

    ReplyDelete
    Replies
    1. Anonymous12:25

      Quote couple of negative commets today.

      Delete
    2. Anonymous12:49

      mhm say Eithad partners I and II

      Delete
    3. Anonymous12:50

      Lol are you serious last Anon?

      Delete
  23. congratulations to all

    JAT is born again

    ReplyDelete
    Replies
    1. Anonymous16:12

      good news for those making money off Air Serbia.

      Delete
    2. JATBEGMEL22:40

      @ Petar

      you mean Jat Airways? JAT did show profit before the fall of Yugoslavia.

      Delete
  24. Anonymous15:10

    Great negotiators this lot (not). Telling the creditors you will cover the loans.... they should be keeping this info close to their chest.

    ReplyDelete
  25. Anonymous15:24

    Air Serbia 2013-2020:
    248,5 million EUR Jat restructuring (167 millions debts from Jat, 16 million for employees to leave company, 0,5 for employees in Jat Catering, 22 million for process of restructuring, 43 million for bridge of debts)
    3,1 million EUR Serbia donation in 2013.
    89,1 million EUR Serbia and Belgrade airport donation in 2014
    71,3 million EUR Serbia and Belgrade airport donation in 2015
    41,5 million EUR Serbia and Belgrade airport donation in 2016
    16,5 million EUR Serbia credit to Air Serbia
    32 million EUR Serbia and Tourist organization donation in 2017
    20 million EUR Serbia donation in 2018
    20 million EUR Serbia donation in 2019
    2 million EUR for PSO in 2019
    200 million EUR in 2020 for Etihad Partners debts, "regular" donation, PSO and Covid-19 costs

    = 744 million EUR in 7 years

    Huge!

    Croatia in that period
    70 million for PSO
    100 million for restructuring
    33 million bridge loan in 2019
    90 million plan for Covid-19 help

    =293 million

    Very big, bot not even near to Air Serbia!

    ReplyDelete
    Replies
    1. Anonymous15:37

      I love how you added Jat's debts to the calculation. So we are over that story that Air Serbia is brand new and is not allowed to claim Aeroput's legacy, hence making it one of the oldest still operating carriers?

      Delete
    2. We are talking about real money here.
      Who cares about Aeroput?

      Delete
  26. Anonymous15:24

    Air Serbia 2013-2020:
    248,5 million EUR Jat restructuring (167 millions debts from Jat, 16 million for employees to leave company, 0,5 for employees in Jat Catering, 22 million for process of restructuring, 43 million for bridge of debts)
    3,1 million EUR Serbia donation in 2013.
    89,1 million EUR Serbia and Belgrade airport donation in 2014
    71,3 million EUR Serbia and Belgrade airport donation in 2015
    41,5 million EUR Serbia and Belgrade airport donation in 2016
    16,5 million EUR Serbia credit to Air Serbia
    32 million EUR Serbia and Tourist organization donation in 2017
    20 million EUR Serbia donation in 2018
    20 million EUR Serbia donation in 2019
    2 million EUR for PSO in 2019
    200 million EUR in 2020 for Etihad Partners debts, "regular" donation, PSO and Covid-19 costs

    = 744 million EUR in 7 years

    Huge!

    Croatia in that period
    70 million for PSO
    100 million for restructuring
    33 million bridge loan in 2019
    90 million plan for Covid-19 help

    =293 million

    Very big, bot not even near to Air Serbia!

    ReplyDelete
    Replies
    1. Anonymous15:32

      Maybe if you post couple of more times your semi-lies will become truth!

      Delete
    2. Anonymous15:34

      "200 million EUR in 2020 for Etihad Partners debts"

      This is a complete falsehood since the loans are being reatructured and renegotiated.

      Delete
    3. Anonymous15:40

      I'm sorry how did you calculate that the Etihad partners loan is 200 million euros when the value of the total 2 loans is half of that????

      Delete
    4. Anonymous16:07

      He said 200 million is for the loan, goverment aid because of Covid, PSO and usuall goverment aid.

      Delete
    5. Anonymous16:15

      - 100 million for this loan
      - 20 million for "regular help" by Government
      - 3 million for PSO
      - 80 million for extra Covid-19 help

      = some 203 million EUR

      And how is that semi-lies? Can you demand this numbers?

      Delete
    6. Anonymous16:16

      his whole list is full of half thruths and mixed up numbers. He also didn't realize that the Etihad partners loans are accounted for in US dollars and not euros.

      Finally it's scary that an airline such as OU received so much money but has little to show for it. Not even nonstop flight from Zagreb to Rome.

      Delete
    7. Anonymous16:23

      And that is why I put 113 million USD to 100 million EUR!

      Which number is not true? Precisely which one?

      Croatia Airlines had just 20% less passengers and more routes than Air Serbia, but still 2,5 times less subvention. Get real.

      Delete
    8. Anonymous16:29

      Well to start of the first thing you lie about is that they got money from the state for the loans. So you make up falsehoods as you go, presenting your information as facts. The government has not given Air Serbia money for the loans and has not indicated it will cover the entire loan. It alao said negotiations with creditors are taking place meaning the loans will likely be restructured so its questionable whether the full amount will be repaid.

      So that's just one in a sea of falsehoods you are presenting as facts.

      Delete
    9. Anonymous16:34

      Also the aid you accounted for Croatia Airlines is also false. Sure you accounted PSO. What you forgot to account is things like the extra subsidy Croatia Airlines gets from city of Dubrovnk which pre purchases seats and then sells them at subsidised rates and that's just one in a number of subsidies you forgot to account.

      Delete
    10. Anonymous16:34

      Oh yes, they did, 9.1.2017 from Fond za razvoj Republike Srbije credit of 16,5 million USD + 3,5% interest per year. You have it in Air Serbia financial report!

      Next number out of 744 million?

      Delete
    11. Anonymous16:38

      And you know that's for the loan repayment which hasn't even begun, which is being negotiated...

      Buddy you sound like you are having a nervous breakdown. Rather than focusing what Serbia spends its money on and wishing for 1800 people to loose their jobs, why not focus on Croatia Airlines or Zagreb Airport and the disaster of a concession?

      Delete
    12. Anonymous16:42

      Whats the point of comparing OU and JU. None of these airlines are not profitabile successful carriers independent from the state. Get over it.

      Delete
    13. Anonymous22:49

      I don't care about Croatia or Zagreb Airport. My interest is Air Serbia which is payed from my taxes.

      As far as I know Etihad Partners refuse negotiation and ask for full refund.

      Delete
    14. Anonymous23:12

      No they did not refuse negotiations. They said so themselves and if you even read today's article you would see they are negotiating. What they refused is to reduce the loan value by 82%.

      Delete
  27. Anonymous15:33

    Will they provide financial help to Smatsa also ?

    ReplyDelete
    Replies
    1. Anonymous16:21

      and to:
      Airport Belgrade
      Airport Niš,
      Airport Kraljevo,
      Airport Užice,
      Air Pink,
      Prince Aviation,
      Balkan Helikopers,
      bus companies,
      rent'a'cars,
      hotels,
      restaurants etc.

      Delete
  28. Anonymous16:03

    As a Serbian taxpayer I wholeheartedly support this move and so do my compatriots. If JU was such a big deal people would be talking about them which they don't. It's just a small frustrated group that can't face the reality. Cry me a river, build me a bridge and get over it. We have been reading the same kind of comment for many years now.

    ReplyDelete

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