Slovenia’s Finance Minister, Klemen Boštjančič, who was also the CEO of the now-defunct flag carrier Adria Airways, has urged caution over plans to establish a new national airline, stating the country’s budget could not handle another loss-making state-owned company. The comments were made after several ministers in the cabinet expressed their support for the creation of a new airline and an expert study showed a Public Private Partnership (PPP), which would see the government join forces with a private company to set up the new carrier, was presented to the public. “The analysis represents just 15% of the data required to make a decision about setting up a new airline”, Mr Boštjančič, said.
The Finance Minister noted, “There is no doubt that Slovenia's air connectivity is poor, this has to be addressed. But this can be done in multiple ways. A Public Private Partnership is the only realistic option to create a local airline - if it is created in the first place. The state is not an institution that can strategically manage such a company. I am repeatedly surprised, and critical in internal talks, by statements made by my fellow ministers who vehemently argue how public finances can easily handle various projects, in this case an airline. This is not true. We need to decide what the strategic projects are and what are the things that we really need. I know a little bit about the aviation business. It is one of the most competitive industries globally”.
During his time at Adria Airways’ helm, Mr Boštjančić implemented wide-scale cost cutting measures at the airline, which stabilised the carrier’s finances. However, it came at a cost, with the company diminishing its route network, resulting in a major plunge in passenger numbers. In 2012 the carrier handled under a million travellers for the first time in seven years. The former CEO was praised for securing bank loans and government handouts for Adria. Mr Boštjančić pushed for the airline’s privatisation and said that national carriers from the former Yugoslavia should merge if the Slovenian airline failed to find a buyer. Adria was eventually privatised in 2016, which ultimately sealed its fate.
An opinion poll conducted on behalf of the Slovenian daily “Delo” has shown that 70.6% of Slovenians support the creation of a new airline if it were to be profitable. However, only 17.6% believe it should be established even if it were to produce losses. Asked whether the government should include a private partner, 55% of respondents answered affirmatively, while 22.9% were against it. Just over 22% of respondents were undecided. Some 26% said they would choose a Slovenian carrier for a trip abroad even if the airfare was more expensive than from a nearby airport outside of Slovenia.
You would think that as a former Adria CEO he would be most in favour of an airline.
ReplyDeleteHe is known as the CEO who contributed the most to Adria bankruptcy.
DeleteAlmost every former CEOs are against Air Slovenia (Bostjancic, Skobir, Grasek,..). Everyone is talking something must be done to improve connectivity but no one comes out with actual plan. I believe that Slovenia did everything it could so there is only solution left. Market did not take of itself as we can see, so have to do it alone.
DeleteMaybe you could write an article what had happened in the aftermath of the 4K investment fund mismanagement of the company. Also, is there any closure on that story. In criminal forensic terms
DeleteHe is right. There is a risk that government cronies will use it as an opportunity to steal more money from another source. Slovenia is not doing well financially anymore.
DeleteYou have mistaken him for Mark Anžur... Boštjančič was unpopular because he was setting back appetites from some (flying) employees, whereas Anžur is a person who is afraid to say NO!
DeleteHere comes the plot twist in this never ending telenovela
ReplyDeleteVery questionable if the government will approve the plan
ReplyDeleteEven if they do, finding a private investor will be anything but easy.
DeleteI think they already have a private investor lined up and I think it's Amelua.
Delete^ i think so too. This would also allow the whole thing to launch much earlier as they could use their own AOC, fleet, crew, etc
DeleteYes, but I don't think that their E135s are aircraft that would be profitable and they do not have many a319s in their fleet and they anyway use them for AirFrance flights in France. They would need an E190/95 as it would probably be the best option.
DeleteAnn 9:11
DeleteAny reason to think so?
Party pooper.
ReplyDeleteOk what is his alternative? Subsidies for airlines has failed spectacularly.
ReplyDelete70% are in favour of a new national airline but only if it's profitable. Lol
ReplyDeleteSmart nation
DeleteWhat else could you expect if you ask general public about it? There is something else wrong with DELO article: the pool results are very much in favor of a new airliner, but the article highlighted the only negative opinion ("Do you want a loss making company?") and based their story on that. The conclusion of the article is: let's pay a foreign airliner to make a base in LJU. So FRAPORT/Air Dolomiti story, where the state should take all the risks (and costs) with no multiplication benefits and Fraport & LH get all the profits. Well done. :-P
Deletethe worst part is, that people are against it due to the financial loss but they still use buses and railways which use way more money from the goverment than Adria ever did but none of the media is going to tell this in their articles... as they are stupid :(
DeleteIts a well known fact that negative press generates more reading time thus this was pushed forward. It's absurd if you ask me, especially as loses are quite clearly covered by indirect income
DeleteActually that's not true, for those who read this survey from Mediana knows that questions was really tricky. They asked if you agree with new national carrier even if it makes loss and of course most of them answered NO. But it's completely different if you ask like this, Do you agree with establishment of new national carrier which would generate 400 mio € in multiply effect even though carrier as itself would have 10 mio € loss?
DeleteThat's completely different..
Plus: the investment needed is much less than Slovenia just paid for a medium sized military transport plane … without any signifficant public discussion or pools.
DeleteSame thought's here, we spend 80 mio EUR for military plane which will be use let's say..10 times per year?
DeleteIf they actually establish new airline then they should do it very smart. Make it small, flexible and profitable airline and carefully spent every eurocent, if possible. But knowing our, in politics still prevailing yugocomunist mentality, I seriously doubt that this is possible in Slovenia. Soon, there will be sons & daughters of VIP's flying for free with this new airline, while rest of us will need at least 600€ to fly anywhere. As it was with Adria.
ReplyDeleteso it's better to spend 800€ as you have to do it now when flying with LH group? They are much more expensive then JP. Everyone who's flying knows that.
Delete@idnas
DeleteIn "yugocomunist" mentality, especially during the last decade of Yugoslavia, both Adria and JAT were managed by highly skilled professionals, were self-sustaining entities doing succesfully business on the open market, and making profits, were innovative, with out of the box thinking, and let my just remind you, were the first, or among the first in Europe to receive brand new super modern at those times state of the art A320/B737-300 respectively. What we have today in both Slovenia and Croatia is not 'yugocomunist mentality' but Danke Deutschland mentality, combined with the worst misuse of ultraliberal capitalism
Couldn't agree more. And the current situation could be thanked to the people like Mr. Bostjancic who is criticizing the establishment of the new carrier while he was the one making all the wrong decisions while he was Adria's CEO and it is really sad that people like that are now our financial ministers. And same with current situation in Jasmin's OU.
DeleteI have to agree with mister Pozdrav on this, results speak. At the end of the 80's air transport industry in Yugoslavia was something to be proud of.
DeleteSince late 2000's it's a garbage dump on fire.
You just knew that something like this would happen and things won't go as easily as Alenka Bratusek said. I really hope that a national carrier will be established because changes in the Slovenian aviation sector are urgently needed, but we are still far from it. I also think that if it will happen, the best possible way is to partner with Amelia or Solinair.
ReplyDeleteGrab the popcorn guys. This saga is going to be an interesting comedy show.
ReplyDeleteI'm probably the least in favour of the new airline. But Bostjancic should be the LAST to talk about it, especially seeing his history with Adria. It's actually absurd
ReplyDeleteI hope it won’t go through. It is simply not feasible to have it.
ReplyDeletebut its feasible to be the last one in terms of connectivity in EU?
DeleteI wonder what all those people who are against a national carrier in Slovenia think is the right thing to do to improve a connectivity becouse something it’s clearly needed as Slovenia is loosing more money not having a national carrier or being connected to the world (150 mio loss due to the bad connectivity). I am not saying that a national carrier is 100% the best option but I don’t see much other options as the subsidies has very clearly failed. So I am interested in what those people think
DeleteIt's very odd opinion for the ex-CEO. One would think he would be in favor of a new airline with his experience in Adria. The most interesting part of this article are actually poll results by Delo. I hope Slovenians' wishes will come true.
ReplyDeleteThose two studies contain much more data that Bostancic ever ordered or respected during his (wrong) decisions as Adria CEO.
ReplyDeleteMaybe he's just embarrassed he only could make the routes to Brussels and Frankfurt profitable when he was in charge of Adria (not to mention 63% load factor overall)
ReplyDeleteSlovenia is a small country for a national carrier. Ljubljana Airport is not very well connected to the rest of the country and even with Ljubljana by public transportation. It costs me more to get from Ljubljana to the airport than from Frankfurt to my home by taxi. Ljubljana has less than 300000 people, out of 2000000 inhabitants. For people in Maribor area, Graz and Zagreb Airports are closer than Ljubljana. For 1/5 of Slovenia, Trieste Airport is closer than Ljubljana Airport. Another 1/5 of Slovenia is closer to Zagreb Airport than to Ljubljana Airport. So basically Maribor + area closer to Trieste + area closer to Zagreb = more than half of Slovenia that has another option than Ljubljana Airport. Ljubljana Airport is not centrally positioned thanks to the geograhy and is a victim to great road connectivity to the other countries.
ReplyDeleteWith such small planes, it will be very hard to be profitable + the study says average ticket should be 134 EUR (that is probably one way without taxes, without luggage). I visit Ljubljana often and I use that airport. When you drive to the airport from the city center, you drive in the opposite direction from where most people live. Slovenia does not have big diaspora and Gastarbeiters like the rest of EXYU. Majority of "Gastarbeiters" in Slovenia are going crossborder to Austria. So no Gastarbeiter flights like in the rest of EXYU. Fraport people are not stupid, the airport is just a victim of its geography.
To add one more interesting info, Venice Airport is a bit more than 2h by car from Ljubljana, from other areas less than 2h. One business partner once told me that he often flies from Venice. He owns the company that makes several million EUR profit a year. Not sure that he was chasing 9.99 EUR Ryanair deals.
DeleteGermans just do their job. Concentration is on cargo from Slovenian industry.
DeleteI agree with Anynmous 11.37:
DeleteWhere are all these phantomatic pax from Slovenia, flying to these "new" destinations, at such prices coming from?
Where do you find a big amount of business pax from Slovenia and abroad using such service?
Where do you find all the tourists from abroad, flying to Slovenia, from just some "new" airports, at non competitive prices, year round?
With all the additional options already available: no way.
Stop this Slovenia centrism mentality, come on, this is not basketball!
Don't push, fake huge numbers of interest and need when there is not and can't be artificially created.
LCC with a base in Ljubljana can do the needed job.
You don't need a new airline to add a daily rotation to FRA, MUC etc as a feeder airline.
Start Skopje and that's it.
Don't dream of a not LCC carrier flying to Copenhagen or Madrid year round. Will not work.
As parents,we are teaching our preschool kids that they can't get whatever they want, father (and mother) have not a no limit income.
Go figure.
So what is the right size of a country to have its own national carrier? 2,1 mio population? 2,5? 5?
DeleteCmon guys, if Slovenia lack og connectivity and foreign airlines clerly does not want to base an aircraft here then something has to be done. Im not taliing about airline with 20 aircraft but 5 would be nice addition for LJU
I don't see that big lack of connectivity that you are writing about.
DeleteAm I missing something?
Then you are just blind.
Delete@Anonymous 12:37
DeleteIt is not point of the right size, but rather size + other factors such as described in my initial comment @Anonymous11:37. Look at Slovakia for example. Very similar example. They even lost air connection to Prague after decades, but to be honest they nice road to Prague that takes less time than flying. Ofc you can make an airline flying out of Maribor to Sydney, with enough money, but you better build a hospital or whatever is needed with that cash.
When someone mention BTS and compare it to LJU then I don't even have energy to reply on that post tbh...
DeleteYou mentioned hospital, but we all know that most of them (at least in Slovenia) are making loss. So why should be invest money into something which brings loss? It's a sarcastic question but it is very related to "concerned taxpayers" mindset when new national carrier is on topic.
Bratislava is quite good comparison to Slovenia in general. Most of Slovenian population is surrounded by other airports that are reachable in the similar time as Bratislava to VIE. That is why the airlines are not bidding millions for slots at LJU and MBX.
DeleteVIE is not comparable with VCE/ZAG/GRZ and 30 min is not comparable with 2+ hours. So no, its not comparable at all.
Delete@11.37
DeleteMontenegro, Luxemburg, Albania, Latvia, Malta....
All they need is couple of vans to shuttle people to Treviso, Venice, Zagreb and Graz.
DeleteLong term for Slovenia is cheaper to nationalize Ljubljana Airport from Fraport, lower the airport charges and handling costs to rock bottom and lure the Airlines from Trieste, Klagenfurt, Graz, Zagreb, Rijeka, Pula, Venice and Treviso. Airline would be a money pit, while nationalization of the airport would cost them haft or even less and no European Commission meddling for every move. Ljubljana has great Railway and road connections, national airport with competitive (rock bottom) charges would bring AirBaltic, Volotea, Ryanair and other players in the game!
ReplyDeleteIt's partially true.
DeleteWhy not try to attract a LCC to Maribor first, minimum money input needed. What do you think about it?
I agree aswell its about time to do something with MBX atleast a new owner is Slovenian and something could be done. But due to Graz and Zagreb airport being very close its really hard.
Deletewe could attract LCC for some routes but LJU will never be base for single LCC aircraft.
DeleteIt is so strange to me that many people comment here without actually having a look at the map. Have you seen where Maribor Airport is located (18min from Austria) at the other end of Slovenia towards GRZ? Have you seen where the beep is Ljubljana Airport (in Kranj, another town) on the other end of Slovenia towards KLA? Have you checked the connectivity to the airports from other towns in Slovenia? Celje to LJU and Celje to GRZ both 1h by car. Maribor to LJU and Maribor to ZAG both 1H:25 by car. Novo Mesto to Zagreb and Novo Mesto to Ljubljana both 1h by car. Maribor to GRZ 39 min by car. Ljubljana to KLA and TRS- 1H26m, ZAG - 1H37, GRZ - 1H50, VCE - 2H. Koper to TRS 53m, to LJU 1H23m, to VCE 1H48m. Connectivity by public transport quite similar.
DeleteSo what is your point exactly, that we should drive 2 hours to catch a flight? That's ok when you are tourist and you have LCC flight at 11 am or later. But if you travel for business matter then mostly you have to catch flight at 7 am, meaning that you have to be at VCE/ZAG/GRZ around 5 - 5:30 am, which means leaving home at 3 am. If that suits you just use those flights but most of us are missing morning/evening departures from LJU.
DeleteI could also write similar case for passengers coming to Slovenia, there are not many of it who will take a go-opti and drive 3 hours from VCE (if you need to wait for some other passengers then even more).
So stop please with airports "near" us because it's not convenient for politicians / business pax / high valued tourists.
What I want to say is that for majority of people, those who do not live in Ljubljana or Kranj, LJU is of the same distance as other "near" airports.
DeleteAnd I am saying that LJU with it's surrounding is not so small. Last but not least, most of business or political appointments are held in LJU so actually it's mandatory that LJU has a decent connectivity.
DeleteFor start 3-5 aircrafts are not such a big deal that we could not finance it. Actually it should not be even a question from where to get money as it was explained that for every spend euro we get 10 back (multiply effects).
3-5 Embraers E190/95 E2 would be a perfect fleet for now.
DeleteKrajnc pretty much confirmed that Amelia is going to bid for the partnership
ReplyDelete"V primeru, da se bo slovenska politika res odločila, da gre v nek korak postavitve, pa da ne bomo govorili o prevoznikih, ampak povezljivosti Slovenije in da bo to neka skupinska zgodba ... to se pravi, ne samo letalski prevoznik, ampak tudi promocija Slovenije v tujini, podpora od diplomacije, da se dobi prave slote, tudi z drugimi letalskimi družbami. V taki zgodbi bi z veseljem sodelovali," pravi Krajnc.
The saga continues ..
ReplyDeleteFraport is doing everything to keep LH concern one&only favourite at LJLJ.
ReplyDelete