Local start-ups prepare for launch


The Covid-19 pandemic has sent many airlines spinning into financial ruin, and some will not survive the industry’s largest crisis. However, there are start-up airlines that are defying the bleak environment and persevering with plans to launch operations. While there is no doubt they are entering service during extremely challenging market conditions, they do have some advantages. Aircraft are much cheaper to obtain now, and airlines can start at a scale that suits the depressed demand - which is a luxury the incumbents do not have, with their fleets that were designed to suit the pre-pandemic world. Competition will also be less fierce for the immediate future, giving the start-ups some breathing space to establish a foothold.

In the former Yugoslav region, several airlines are looking to start operations. They include ETF Airways, which is closest to launch, the ambitious Dubrovnik-based premium long haul carrier Pragusa.One, another Croatian start-up being set up by the boss of Germany’s Sundair, as well as Slovenia’s SouthEast Airlines and Montenegro’s new national carrier ToMontenegro.


Based on its current plans, ETF Airways intends on taking delivery of its first Boeing 737-800 aircraft later this month or in early April. The AerCap leased jet will be used for charter flights. ETF intends on focusing on routes from the Croatian Adriatic coast, such as Dubrovnik, Pula, Split and Zadar, to airports in France, Germany and the UK. As EX-YU Aviation News learns, the airline has been in discussions with local tour operators over making its aircraft available to shuttle passengers to the Croatian coast on their behalf.


Elsewhere in Croatia, the owner and CEO of German charter carrier Sundair intends on launching a new airline this coming summer. Although initially planned to commence operations in late April or early May, its first flight is now expected during the third quarter. The airline is currently working on obtaining an AOC [Air Operator’s Certificate]. Meanwhile, the UK-registered Pragusa.One has set out an ambitious plan to commence flights from Dubrovnik and Prague to a number of destinations in the United States, Canada, China, Japan, South Africa, Malaysia and Singapore with a fleet of Airbus A330 and A350 aircraft. Based on reports, the carrier will apply for an Air Operator’s Certificate in April and has secured incentives from its base airports.


SouthEast Airlines hopes to launch operations from either Ljubljana or Maribor in Slovenia this June with its initial focus being on charters and ACMI (aircraft, crew, maintenance and insurance) wet-lease flights. The carrier has already finalised contracts for a demanding charter season this coming summer. Its initial focus will be on European Union markets. The airline will acquire an Airbus A320 jet in order to commence operations but intends on growing its fleet by adding another aircraft of the same type by the end of the year, with a total of six planned by 2023. Cabin crew are currently undergoing training.

Montenegro hopes to establish its new national carrier by June following the collapse of Montenegro Airlines. The state has acquired two Embraer E195 jets for the carrier, however, its CEO noted the fleet will grow in line with demand, with up to six jets currently planned. The airline’s first route from both Podgorica and Tivat will be Belgrade. There are also a few other destinations that are of interest, but their launch will depend on whether those markets are open at the time ToMontenegro commences operations, as well as demand and cooperation with tour operators. These markets include Russia and a select few in Western Europe.


Comments

  1. Anonymous09:13

    Question is, will any of them work.

    ReplyDelete
    Replies
    1. Anonymous09:17

      With three start ups in Croatia I'm hoping at keast one has some success.

      Delete
    2. Anonymous09:18

      *least

      Delete
    3. SouthEast Airlines hopes to launch operations from either Ljubljana or Maribor in Slovenia.

      Delete
  2. Anonymous09:15

    Good luck

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  3. I like livery of SouthEast Airlines.

    ReplyDelete
    Replies
    1. Anonymous09:19

      Me too. Looks good.

      Delete
  4. Anonymous09:21

    I think the airline being created by Sundair boss has greatest chance of success.

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    Replies
    1. Anonymous09:47

      I would think the new Montenegrin national airline had the greatest chance considering it's getting state money.

      Delete
  5. I work in the hospitality (5-star hotels) in Dubrovnik.
    Organized travel (groups) is dead and will be so for at least 2 more years. This year and next year, there is a chance for a semi-decent season in Croatia and Dubrovnik which will be based on the individual travels, however 2 peak months tops in July and August. Next year, maybe 3 months.
    And that may be a stretch/wishful thinking.

    Groups are an important element in helping airline operations stay afloat in the shoulder season (April/May, Sept/Oct).

    Asian groups were filling Qatar, OU and EK planes, whose pax eventually ended up in Dubrovnik hotels in shoulder season.

    I hope for the best, but honestly I dont have high hopes.

    At least not for 2021, maybe 2022.

    ReplyDelete
    Replies
    1. Anonymous09:53

      Interesting. Do you think these airlines don't have a chance of any successful start.

      Delete
    2. ETF stands the most chance IMO. They seem to understand the underserved charter market aspect in Croatia, for both outbound and inbound travelers. However, I think the name is a huge fail (i base this on an experience as a brand and marketing manager), so that may cost them in the end. If they are only going to focus on B2B and fly on behalf of no name airline for xy tourost agencies, then the name is not as relevant.

      Delete
    3. Anonymous10:44

      Actually ETF won't stand a chance because OU is finally getting its act together. They started digitalizing themselves and they will a huge focus on the coast now. This will help them stabilize their finances so that they can go back to their full potential.

      Delete
    4. Anonymous12:26

      @Anonymous that is very optimistic perception... I wouldn't rely on Croatia Airlines too much...

      Delete
    5. Anonymous13:51

      None of these startups will harm OU.

      Delete
    6. Anonymous13:52

      I also don't see (even if they launch) hurting OU. They do very few charters. Maybe it stimulates them to do more in this area.

      Delete
    7. @Petar
      You are right. As much as we'd like to see a partly recovery this year- it won't happen.
      Let's hope for 22.

      Delete
  6. Anonymous09:25

    Who is financing all of this?

    ReplyDelete
    Replies
    1. Anonymous09:37

      Private investors.

      Delete
    2. Anonymous09:43

      State for ToMontenegro

      Delete
  7. Anonymous09:55

    Hope some will work out.

    ReplyDelete
  8. Anonymous10:05

    Good luck to them, they will need it. Meanwhile Wizz Air moved five aircraft into long-term storage: 1x A320 and 4x A321.

    G-WUKC, G-WUKD, G-WUKI, G-WUKJ & G-WUKL

    ReplyDelete
    Replies
    1. Anonymous21:26

      Dozens of aircraft are in long term storage, it's only Wizz UK. Five 320s had been returned to the lessor in the last two months with others to follow.

      Delete
  9. Anonymous10:08

    I can't believe this Pragusa airline has already received support from the airports. Crazy

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    Replies
    1. Anonymous10:25

      Or that the Slovenian airline has charter contracts already.

      Delete
    2. Anonymous10:35

      And then people complain when their flight is ruined or is not happening. Like all those new W6 bases and flights. They announce then with so much fanfare but in the end they silently cancel them, no word of it.

      Delete
  10. Anonymous10:42

    I think ETF would really benefit the Croatian coast

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    Replies
    1. Anonymous12:28

      Indeed...and finally make Croatian tourism based on full year not only few months in year. Imagine having charter flights from Scandinavia to Croatian coastline during winter months... I bet the demand for these flights would be insane... I really hope ETF will become one of the strongest players in Croatian aviation industry.

      Delete
  11. My work enables me to have access to industry-high articles on global finance/business covering all sectors, i.e. travel, airlines, hotels being one of many. Initially like many (both experts or just casual observers) I thought this will last 2020 and will start picking up fast in 2021. That it seems, was wrong. This will be 'new normal' for some time, maybe 2-3 years more. Tourism will come back but in a different format not the same as it was. It will take probably 3-5 years for us to come back to 2019 levels or to the level of safety we had in 2019 as humans. No doubt this is probably the worst hit on travel/tourism since WWII. Many will not survive, but survivors will explode. I think we might have then decade like crazy 1920s when world wanted to catch up to lost years of Spanish Fever/WWI. This calamity hit sectors/jobs that you would never thought would be hit hard, like pilots for example. They got decimated and who would have thought. Local travel will recover faster, cars/smaller hotels in nature with limited capacity. Big tours, groups, huge hotels, big flights, mega destinations.........they will take longest to recover. I hope I am wrong and I hope we fully recover in 2 years, i.e. mid 2023.

    ReplyDelete
    Replies
    1. Anonymous13:03

      Very good comment 👍

      Delete
  12. Anonymous12:25

    Hope it can work, but what will they all do in winter?

    ReplyDelete
    Replies
    1. Anonymous12:27

      ACMI in other parts of the world (or Europe)

      Delete
    2. Anonymous12:33

      Create charter trips for Africa just like Enter Air and Travel Service do...don't forget Croatian coastline has a great weather conditions compared to the north. Having charter flights and bringing retired population to Split or Dubrovnik must be really good opportunity. Plus unpredictable situation in Europe gives big advantage to charter operators for adhoc and last minute flights compared to scheduled carrier. If Istra is green area with least infections, in less than a week charter trip with flight ticket and accomodation can be arranged. I try to remember what Dubrovnik Airline did in 2008/2009 crisis and they did good job even in the middle of the crisis!

      Delete
    3. Anonymous13:50

      Why hasn't Trade Air done something like this?

      Delete
    4. Anonymous14:16

      There are so many ACMi airlines around the world that will be doing this and there will be much less need for ACMI leases in the years to come as so many aircraft are grounded.

      Delete
  13. Anonymous13:50

    This is exciting. I wish them all the best.

    ReplyDelete
  14. Anonymous13:50

    What a time to launch a new airline...

    ReplyDelete
    Replies
    1. Anonymous14:03

      Anyone who wants to start up an airline at this time must be very bold. Wish them good luck.

      Delete
    2. Anonymous14:06

      It's the best time to launch a new airline. It's like buying stocks, buy low-sell high. It would be bad move to start in 2019 when market have reached the top. With current prices and market conditions it is reasonable decision. Don't forget people working in the management have more internal data than random people commenting on forum with no previous aviation business experience.

      Delete
    3. Anonymous14:16

      Actually with established carriers in a crisis and the price of leased aircraft at record low levels this is a time of great opportunity.

      Delete
  15. Anonymous13:52

    I feel all of these will end up in the same bag with the other unsuccessful airlines.

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  16. Anonymous14:00

    I hope that these ideas will become a reality.

    ReplyDelete
  17. Anonymous14:17

    ToMontenegro is the only one that will get off the ground.

    ReplyDelete
  18. Anonymous17:40

    Start up epidemic.

    ReplyDelete
  19. Anonymous17:40

    The only question is will they suspend flights before they start flying or afterwards

    ReplyDelete
    Replies
    1. Anonymous18:03

      It doesn't necessarily have to be like that. With these start up airlines in Croatian, I think the main question is what sort of capital do they have. Who is behind them. Because all of these airlines go belly up because they don't have cash, meaning they don't have a strong financial backing.

      Delete
    2. Anonymous22:49

      Is there anybody who really believes this?

      Delete
  20. Anonymous18:03

    I hope this succeeds and support any kind of enthusiastic idea, especially in aviation industry.

    ReplyDelete
  21. Anonymous18:11

    Due to low plane leasing rates, it is quite easy to set up an airline now a days.

    ReplyDelete
  22. Anonymous18:12

    Despite the pessimism i see good chances of at least some of these succeeding.

    ReplyDelete
  23. Anonymous18:23

    I've lost all trust in Croatian start-ups

    ReplyDelete
  24. Anonymous18:24

    I don't get the point in all of this

    ReplyDelete
  25. Anonymous18:35

    It's good to see various airlines operating in Croatia and not only depending on the flag carrier compared to other countries in the region. My personal favourite is SouthEast. Good luck to Hrvatska!

    ReplyDelete
    Replies
    1. Anonymous18:37

      Southeast is in Slovenia...

      Delete
    2. Anonymous19:13

      Lol

      Delete
  26. Anonymous22:48

    Why is everyone so negative towards this? Sure some of these plans are a bit out there but they are all seeking an AOC and things are moving in the right direction, so they have already proved some people wrong.

    ReplyDelete
    Replies
    1. Anonymous23:12

      +1

      Delete
    2. Anonymous23:13

      Completely unrealistic.

      Delete
    3. Anonymous23:13

      The fact of the matter is that they are sticking to their plans for now.

      Delete
    4. Anonymous23:14

      Any investment in the region is welcomed but I never heard of anyone getting an AOC swiftly.

      Delete
    5. Anonymous06:19

      Because they are trying to start a business now when demand is still soft to the region. Seems like Croatia and Montenegro won't be hot destinations this summer. Eurowings just added a second A320 to Dortmund and not a single destination was added to these two countries while they only announced seaside flights. It won't be a good year, quite a bad one actually.

      Delete
  27. Anonymous23:15

    I hope this happens.

    ReplyDelete
  28. Interesting article. I wish them all luck, naturally. I may be a bit more optimistic than many, but critically, we need 2 things;1) the EU vaccination rate to improve fast 2) infection rates to fall. Last year without vaccination, we had strong demand for DBV in July and Aug, there's no reason for that to be worse. I'm a bit less confident the EU will get it right in terms of vaccine volumes. However, the 2 strongest markets for DBV are UK and USA, both storming ahead in vaccinated population percentage.
    Separately, some airlines are reporting to shareholders they expect a subdued start to the season, but are already considering options to extend their flights to the end of November to make up lost ground. As already said, this is a great time to start an airline if you have strong investors, when people can travel, demand is expected to be high. That should give them enough revenue to make it through winter, and then 2022 is a whole new ball game. If the virus is managed well through winter, pent up demand for international travel could be extreme.
    Plan for the worst, hope for the best and you never know. Every day brings a new surprise at the moment!

    ReplyDelete
  29. I struggle to understand why ETF thinks charter flights from PUY, ZAD, SPU,DBV to UK will work.

    Charter flights carrying tourists to holiday destinations in Europe were replaced years ago by LCC's ( low cost carriers).

    tour operators used to charter an aircraft from A to B and needed to fill it. Iften they sold seats to other tour operators yet the flight remained THEIR charter flight.

    LCC's offered a seat rate costing much less than that if a charter flight and without the need to sell all seats on the flight..to make a profit.

    Some may point to TUI Airways. the tour operator and the airline have the same group ownership
    But it is a LCC too. anyone can but seat only. i have bought LGW to PUY one way in May for under 100 GBP.

    So i wonder where ETF believes it will find tour operators to charter flights to Croatia when it is easier, cheaper and less restrictive just to buy seats on EasyJet, Wizz, Ryanair, BA, ..even OU ..and even TUI and Jet2 (the airlines..both sell seat only)

    Strange.

    ReplyDelete
    Replies
    1. Anonymous21:49

      Not totally replaced by LCC... especially in corona times people need guarantee they will fly to destination. LCC are very often cancelling flights last minute. My friends got their flight to Athens cancelled last summer, not even due to travel restrictions but due to low pax booking number. This is why I think charter will work out in coming years. Maybe after we return to normal they will need to adjust their model to other markets and areas but for time being they have good advantage of fresh capital and competition that is weaking every day by grounding their fleet. Plus don't forget Croatian tourism is dead by winter. ETF might start connecting Croatia will exotic destinations in wintertime. I would rather fly with them to Hurghada than to fly with Turkish Airlines via Istanbul.

      This year Dubrovnik announced good bookings but also they expect many last minute trips due to uncertain situation. ETF Airways is Adhoc and charter airline so they will be on standby exactly for these ocassions. Evenmore, LCC is not always cheap. Especially if you include your baggage. ETF Will most probably include baggage in ticket price and in deal with touroperators or hotels, total cost of the trip might be the same but will more safety and guarantee that flight will happen.

      Delete

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