Croatia Airlines is awaiting the EU General Court’s ruling on whether the European Commission’s decision to approve an 11.7-million-euro state injection into the company last year was in line with the block’s rules. The case, brought forward by Ryanair, is likely to be finalised during the third quarter. The budget airline has filed similar complaints over state aid granted to Air France, KLM, TAP Air Portugal and Condor, all of which are related to Covid-19 assistance. The Luxembourg-based General Court has ruled in Ryanair’s favour in the above-mentioned cases but has held off on requesting the airlines to pay back the funds immediately.
Commenting on the matter, Ryanair said, “The EU Commission’s spineless approach to state aid since the beginning of the Covid-19 crisis has allowed member states to write open-ended cheques to their inefficient zombie flag carriers in the name of faded national prestige. The EU commission has hastily approved over thirty billion euros of discriminatory state aid since the crisis began”. Croatia Airlines was compensated with 11.7 million euro for losses incurred as a result of the coronavirus outbreak and the travel restrictions introduced by Croatia and other countries to limit the spread of the virus in the period between March 19, 2020 and June 30, 2020. Ryanair, which will open a base in Zagreb in late August, said last week Croatia Airlines is “irrelevant” in its decisions concerning the Croatian market.
In addition to the 11.7 million euros Croatia Airlines was given to cover losses incurred between March and June 2020, the carrier has also been granted 33.2 million euros as an equity loan by the government and has been recapitalised by the state through a 46.2 million euro cash injection in order to “return the airline’s capital to pre-Covid levels i.e. to the same levels as on December 31, 2019”. Croatia Airlines has said, “This is one of the applicable financial support mechanisms Croatia has adopted based on the European Commission’s temporary framework for state aid measures to support the economy in the current Covid-19 outbreak”. Croatia Airlines registered a 47.3 million euro loss in 2020 after state aid and financial grants are accounted.
Comments
Ryanair is already attacking them and the biggest attack will come when they open their base at ZAG. OU in my opinion is dead even before this ruling is made.
Garuda is in a deep slump. They are negotiating the return half of their fleet back to lessors as well as launching a plan for early retirement of a large chunk of their employees.
That ship has long sailed.
Direct, cruel, truthfull and honest...haha "spineless EU Commission"...priceless :)
They are really vultures and I wish them to stay vultures as long as it is needed for legacies to wake up and realize that nowadays air traffic is a big bus with wings.
I could not care less for "seamless service" and a cushion...give me price options (like JU), maybe connections and low price and I am all yours.
Look at BEG-BER route! Prices before competition were 300 EUR round trip. Now? Now u can find tickets with JU for 80 EUR round trip! And for sure JU makes profit on that route because as soon as u start tweaking costs you realize that you CAN and MUST make additional revenues.
For example - I booked 3 return to BER for 240 EUR. However, I needed one additional bag and I wanted to seat together with other pax on my ticket. Also, we ate a sandwitch and had a coffee on a flight. Total costs in the end were around 300 EUR.
If return with easyjet was 80 and with JU was 100 i would choose easyjet. However, price your ticket low and rip me off later worked fine and I did not complain!
Thats great strategy!
For example in Italy, Alitalia is only the 3rd largest carrier behind FR and EZY, yet which company is receiving tens of millions from the Italian government every month to stay alive?
OU shall be converted into a charter airline and support arriving more British, Norwegian, North German, Benelux, Russian travellers to their coast.
Compared to Greece or Spain, Croatia has very little percentage of tourists that arrived by plane. And those who arrive by plane spend much more than those who arrived by car, bus or train.
- Merging with Trade Air, getting 1 more 319 and 3 more 320
- Use 320 mostly from the coast, open summer SPU and DBV base
- Renegotiate Q400 lease, stop paying double lease to Misetic company
- Lease at least 6 units EMB 170/190 for regional network
- Organise proper waves with 3 daily regional flights from ZAG on EMB and Q400
- Start at least 12 new regional destinations, most to the east, similar to JU model
- Lease 2 units 330 to fill the gap until 321xlr arrives, start NYC, YYZ, ORD
- in the second phase, with 321xlr introduce BOM and DEL to reduce seasonality
- continue growing network, possibly keeping 330 in fleet, 2nd phase as well
- hire professional management
- get rid of uhljebs and excessive administrative workforce
- make revision of all harmful contracts, get rid of "advisers" and "consultants"
- change alliance, or renegotiate status within Star, from feeder to partner
- use croatian equity funds for initial investment
- use FR situation to renegotiate terms with ZAG
Anyone knows?
Buddy, I very often agree with you here on aviation stuff but I really don't believe you dare comparing Croatia and Serbia with Norway and Switzerland. EU is good way to go for poor countries, just not with corrupt and rotten leaders as we have, it's not about EFTA, it's about us
Trade Air is an exceptionally well run company and would cut the fat, get it into shape and then develop a twin strategy of charter and scheduled services.
That would also keep the airline within Croatian ownership and would finally get a good solution in place.
Anybody have any thoughts on this idea ?
corruption, graft, and incompetence were all inbred into OU, but the party will end soon.
c'est la vie.
OK, you found out an easy way to cut off all development funds that are flowing to Croatia, and then what? All this just to get a free hand to subsidise OU? Is this the top priority?
By the way UK is no longer part of EFTA.
Just one example: renegotiate status within SA from feeder to partner. Easier said than done.
If you bring to the US >1 mln pax on your equipment (and on good margins), then there may be space for some discussion about your real status in the alliance. Without that, there are bigger boys in town coming from Europe and in real life their interest matters for the US airlines more than yours. The US airlines will prefer to do business with those bigger boys, whose interest conflicts with yours, so you will be trashed. You may have codeshares or alliances, but no real business will be done with you.
Of course you can spend a lot of money and change an alliance only to learn that the rules are the same everywhere.
It probably would have ruined them...LOL!
Air Serbia but also Wizzair and Easyjet are fortunate to have got some years to prepare for that case and they should use them wisely !
If they made 500m loss every year, you wouldn't see some small French airport covering their losses year after year.
200 x 2 x 365 = 146.000
A DAILY flight on a 200 seater means 146.000 seats both ways PER YEAR.
I don't know about TAP and LOT, but Ju had something like 80.000 pax to/from US in 2019. And Gillivair has zero.
This just shows how clueless you are.
očito ne vidiš da kritiziram OU zar ne? al eto ti si najpametniji i svatko tko se ne slaže sa tobom je uhljeb.