Croatia Airlines’ CEO, Jasmin Bajić, has said the national carrier’s network planning will be flexible and dependant on the global epidemiological situation in the coming period. It comes as the two remaining national carriers in the former Yugoslavia announced plans to significantly grow their portfolio of destinations, with Air Serbia so far announcing eleven new routes throughout its network for the 2022 summer season, with more to come, while Air Montenegro has said it will grow frequencies on all existing routes and unveil new additions to its network in the coming weeks. The Croatian carrier has so far outlined plans to restore operations between Zagreb and Barcelona this summer, with the route having been suspended since 2020 due to the coronavirus pandemic.
Commenting on carrier’s plans, Mr Bajić said, “Traffic will continue to be contingent on external factors, beyond the company’s control, such as restrictions, bans and other measures, which directly impact on people’s ability to travel both domestically and internationally. Accordingly, we will focus on flexible planning of our network. Our goal is to achieve optimal load factors with average fares in existing conditions of reduced capacity. Therefore, in 2022 our focus will be on greater rationalisation of costs and the implementation of the company’s defined post-Covid strategy”. He added, “We worked with the leading international strategic consulting company BCG to develop a post-Covid strategy in order to define strategic initiatives, the implementation of which, with prior consent of the majority owner - the government of the Republic of Croatia - will take three years to enable a sustainable business”.
The post-Covid strategy is expected to be adopted by the Croatian government soon and foresees the renewal of the fleet, improvement in efficiency and competitiveness, as well as the optimisation of Croatia Airlines’ year-round route network. The carrier is facing strong competition at its main hub in Zagreb, with Ryanair now accounting for 17% of all seat capacity from the Croatian capital, while the national airline holds 51%. Croatia Airlines is still interested in the potential introduction of flights out of Ljubljana and is considering its options. However, in line with its flexible network strategy, the airline will temporarily suspend operations between Zagreb and Dublin from January 30 due to reduced demand. Flights are expected to be restored on March 31. Ryanair will continue to link the two cities.
Seems to me like we should not expect much from them this summer, based on what they are saying.
ReplyDeleteyup...trla baba lan
DeleteBasically Bajic has announced the continuation of the status quo.
DeleteOnly thing that will change is their financial performance which will be much, much worse. I expect a loss close to €100 million.
DeleteAny idea on their 2021 financial result?
DeleteIn order to finance the new planes they plan to order, they will have to make big savings. So I doubt we will see some major expansion.
ReplyDeleteIn other words we should not expect major expansion if they plan to continue cutting costs next year.
ReplyDeleteWe probably won't see expansion until new aircraft start arriving.
DeleteLJU is their best opportunity in my opinion.
DeleteI think it is too expensive to do something like that with limited chances for success.
DeleteContinue cutting cost? They did not cut cost in the period behind us and I don't believe they will ever cut costs in the future.
DeleteShould have introduced Ljubljana W formation flights in November 2019!
DeleteProblem is that new planes won't arrive!
DeleteWhat does route network optimization mean?
ReplyDeleteIt says "optimisation of its year-round route network."
DeleteIt means that they will try and reduce seasonality. Which in all honesty is something they really need to do. So I support that move.
I read often in comments that they should reduce seasonality etc. A lot of criticism that they haven't addressed this issue yet. And I agree that this is a crucial issue for them.
DeleteDoes anyone have any idea how they should do it? Croatia is - and will always be - a seasonal destination. Croatia will not be in a position to - at least in the foreseeable future - create a major hub to serve transfer passengers all year long.
The only thing that comes to my mind is that that during the winter season they should do some charter work, not necessarily from Croatia itself. Any other ideas?
Most of their Zagreb routes are year round. They discontinued all of the seasonal ones.
Delete@Anonymous 09:17
DeleteBajicu, is that you?
This process is moving so slowly.
ReplyDeleteWe will juts have to wait and be patient. I'm sure once new aircraft start arriving there will be some real change at OU on all levels.
DeleteAnd why can't they do that now? Since when is the fleet structure Croatia Airlines' biggest problem?
DeleteNew aircraft arriving isn't like some mirracle will happen. The costs will only increase (lease costs), while all other costs will stay the same, so what kind of change do you expect once the new aircraft is there?
DeleteMore cost cutting?
ReplyDeleteSeems like it.
DeleteThe thing they should be working most on is precisely their network.
ReplyDeleteAgree. Their main focus should be expansion onto markets to prevent Ryanair from further developing. But, that seems to be the last thing on their minds.
DeleteWhile everyone else is growing... I'm done with this airline.
ReplyDeleteBCG finished writing up their strategy in summer 2021. By the time Croatia Airlines starts acting on it, it will be obsolete.
ReplyDeleteBCG doesn't care. They got paid good money.
DeleteJust a simple question : Which type(s) of aircraft in fleet is BCG "strategy" based on?The answer to this question says everything.
DeleteThey should have been quick if they wanted to open new routes to prevent Ryanair from further expanding. With them launching Bratislava soon, they will be attacking Vienna route as well. At the end of the day, OU will only be left with transfer passengers which they can not survive on alone.
ReplyDeleteTheir clock is ticking.
DeleteDifficult summer ahead.
ReplyDeleteIsn't this a bit late with the planning?
ReplyDeleteIt's corona time. Most people buy tickets just days before they travel.
DeleteLet's see how things turn out. I wish them good luck.
ReplyDeleteIt will be more of the same.
DeleteBy the time their make up their minds, their routes are being taken over by others. TAP has taken over Lisbon and Finnair has taken over Helsinki.
ReplyDelete+1
DeleteLED has also been taken over by Rossiya, Milan by Ryanair...
So Dublin gone to. Ryanair wins.
ReplyDelete*too
DeleteIt is only temporary
DeleteI don't believe they will continue with Dublin anymore. Too expensive compared to Ryanair, so Ryanair gets all the P2P passengers, and CA would only do it for the transfers from Zagreb, which is not enough to fill the plane.
DeletePre-covid they operated it from March until January.
DeleteBut they planned to fly it year round this year.
DeleteHad the price of the BCG agreement ever been revealed?
ReplyDeleteOf course not.
DeleteDoes anyone know when the government plans to approve this post-Covid strategy?
ReplyDeleteUntil OU selects which aircraft they want to renew their fleet with, which they still haven't done because they feel they have all the time in the world.
DeleteReally hoping things will change for the better.
ReplyDeleteI'm losing hope
DeleteI lost hope long long long ago, 1994, when ATR42 arrived overnight, instead of DC-10, and despite the flights for JFK, ORD and YYZ already been announced and published for sale. That was the moment when Cartel took over and all positive energy invested in OU from the day one, by people who really cared, started to fade, and eventually vanished
DeleteI doubt there will be any sustainable changes both in management or operations.
ReplyDeleteChange in management would be key to resolve many problems including those in operations.
DeleteThey don't have management. They have comitee of aparatchiks executing Party directives in order to please the Cartel
DeleteCompeting with FR in middle of pandemic won't be easy. But I feel like they haven't even tried.
ReplyDeleteThey gave up from the get go.
DeleteWhat can Croatia Airlines realistically do to turn things around?
ReplyDeleteThey could wake up, launch new routes, develop their product...
DeleteUnfortunately, in the middle of the pandemic, I'm not sure OU has the strength to compete against Ryanair in any way. Some very challenging times coming.
DeleteThey should do something and definitely do it differently than what they have done at the cost, where they basically retreated from Dubrovnik completely and let the competition take over.
DeleteThey have a lot of work ahead of them.
ReplyDeleteAlmost all EU countries have healthy competition and their flag carriers have adapted to LCC. Time to restructure and move on with reality.
ReplyDeleteThey had many years to prepare for serious competition and it was bound to happen at some point. They must have been aware of that.
DeleteMore routes to Balkans, good prices, new fleet.
DeleteI was hoping we would see some positive changes at OU with the start of the summer, but the CEOs words are far from encouraging.
ReplyDeletewow at FR already being at 17% of Zagreb capacity. Probably will grow to over 20% in summer.
ReplyDeleteRyanair has more than double the number of destinations from Zagreb compared to OU already.
DeleteYeah but what about rotations?
DeleteWell OU has much more flights.
DeleteJust recently they were talking about how they will launch new markets and basically nothing. They won't have a single new route from Zagreb for 2 years.
ReplyDeleteEurope ends at Skopje for OU. Athens, Istanbul, Moscow? Their destination list is tragic.
ReplyDeletethey don't even fly zagreb berlin
DeleteThey need to operate year-round flights to Athens. I saw that they resuming SPU-ATH this summer but they still gonna operate ZAG-DBV-ATH. In my opinion they need to keep ZAG-ATH year-round.
DeleteYou expect them to start nonstop ZAG-ATH yet they have been flying ZAG-FCO for 30 years via Dubrovnik and Split and didn't think to change that even now when Ryanair has started nonstop flights?
DeleteBravo Hrvatska!
ReplyDeleteHahahaha Hahahahahahahaha
DeleteWhat are the routes that OU suspended with Covid?
ReplyDeleteFrom Zagreb: Lisbon, Oslo, Helsinki, Stockholm, Bucharest, Prague, Milan, Mostar, Barcelona (being restored), St Petersburg, Tel Aviv
DeleteThat is a lot!
DeleteLisbon, Oslo, Helsinki, Milan, and St Petersburg all taken over by competition.
DeleteRyanair will overtake the remaining routes.
DeleteAt this point I wonder how this company is still afloat. The passiveness is just extraordinary.
ReplyDeleteAgree. Like they have no care in the world.
DeleteThe incompetence of these guys is legendary! It is frustrating!
ReplyDeleteLet me see if I understand what they are saying:
- We are absolutely clueless regarding running this company and what needs to be done.
- We have paid huge money to some consulting firm, to cover our behinds, and this strategy is now on approval with the government, so it is again not our responsibility if it fails or not, if it is implemented or not.
- The strategy we paid for is applicable in post-covid times, and since 2022 is still a covid year, we cannot apply it, so we will sit it out, do nothing, because it is not our fault that there is a pandemic and that the strategy we paid for is not applicable.
- We are focusing on the flexible planning, which is in fact - we don't plan anything now, and latter we will see. Maybe. The problem is that when there is an opportunity, it takes us 4 months to react, and by that time the opportunity is gone. So best not to bother planning at all, i.e. flexible planning.
- We will focus on cost optimisation - we will discontinue the flights that are not making money, without rethinking the reasons why. If Ryanair attacks us on a route, we will close it down so that we do not lose money. We still have PSO routes.
- We are buying new planes which will do a miracle for the company and everything will be great again!
- Either way, we will not make any money for sure at least next three years (or ever), so heads-up.
Have I missed anything? Or misunderstood? Argh, this makes me so furious! And I am not even from Croatia! I cannot even imagine how actual people in Croatia feel about this!
+100
DeleteSign under every single word. And what you mentioned is only incompetence. In addition to incompetence, there is also nepotism, crime, corruption, arrogance there. And similar as you are, I was angry and furious long time ago. Now, after 30 lost years and zero chances for anything to be changed, I became just sad and disappointed
DeletePotpisujem.
DeleteOh OU, some airlines are also flexible with their network planning but include new routes and opportunities which have presented themselves because of the pandemic.
ReplyDeleteSeems like they really got value out of the BCG deal...
ReplyDeleteWonder what would they have done without their expertise.
DeleteDisappointing
ReplyDeleteI've lost all hope for OU.
DeleteNo surprise. Didn't expect more from them anyway.
ReplyDeletetheir main focus should be Zagreb and trying to deal with Ryanair's onslaught.
ReplyDeleteJust OU talking more about plans which rarely become reality.
ReplyDeleteThe saga continues.
DeleteCroatia Airlines' growth opportunities are becoming smaller and smaller, that's for sure.
ReplyDeleteAre OU and LJU from the same familiy? Both talking about recovery, new markets... yet nothing from them. Oh I forgot, both are run by LH cartel :)
ReplyDeleteHaha true
DeleteWhat happened with the fleet renewal? Which manufacturer gave the best offer? Airbus, Boeing or Embraer? Will Sukhoi consider offering OU something like it did with JU?
ReplyDeleteAre you for real? You really believe the best offer is what will be crucial and decisive for the new type? You really believe BCG was there to identify how to become better, bigger, profitable ? Cartels don't function that way, unfortunatelly
DeleteIt will probably be Airbus for political reasons.
DeleteJust note that BCG's biggest client is KLM and they just selected A220 over Boeing for regional fleet renewal.
DeleteThey are so flexible that this morning for the first time ever they sent Q400 to CDG!
ReplyDelete