The Serbian government will launch an international public call for the provision of Public Service Obligation (PSO) flights from Niš Constantine the Great Airport and Kraljevo’s Morava Airport shortly. The existing two-year contract, which was awarded to Air Serbia, runs until December 31, after which the carrier has no tickets on sale from the two cities. Similar to two years ago, the tender process is expected to be swift. After the contract is awarded, the winning airline will have ten days to put tickets on sale and will be required to launch operations from January 1, 2024.
The Serbian Ministry for Construction, Transport and Infrastructure said, “Contracts for the provision of flights on routes declared to be of public interest by the Government of Serbia expire on December 31, 2023. Currently, tender documentation is being prepared for the initiation of an international public procurement procedure. The new contracts can only be signed after the 2024 Budget Law is adopted, from which funds will be provided. Similarly, existing contracts were signed in December 2021. After the new contracts are signed, the selected bidder can commence ticket sales for the routes in question”. Last year, the Serbian parliament adopted its Budget Law on December 9. However, Serbia is expected to hold early parliamentary elections in mid-December, and the country's Prime Minister has said the Budget Law will be adopted before the parliament’s dissolution. If elections are held on December 17, as floated by the authorities, parliament must be dissolved by law at least 45 days prior to election day, which would be in early November. Last week, the Serbian government adopted a draft of the Budget Law which allocates 5.2 million euros in subsidies for air transport for 2024.
Under its existing PSO contracts, Air Serbia operates year-round services from Niš to Belgrade, Cologne, Hahn, Istanbul and Ljubljana, as well as seasonal services to Athens and Tivat. From Kraljevo, it maintains year-round flights to Istanbul and seasonal operations to Thessaloniki and Tivat. The total value of the contracts awarded to the Serbian carrier over the two-year period amounts to around 23.8 million euros. In 2021, the Serbian carrier was the only one to apply for the tender. PSOs make funds available for unprofitable routes which are deemed to be of public importance and vital for the economic development of the region they serve. As a result, fares for the abovementioned routes from Niš and Kraljevo are significantly cheaper than those from Belgrade.
Niš Airport has benefited from the PSO flights with 2023 being its busiest year on record so far. It handled 355.518 passengers during the first three quarters of the year, up 20.3% on the pre-pandemic 2019, while its counterpart in Kraljevo welcomed 11.882 travellers. A new 11-million-euro passenger terminal is currently under construction in Niš and is expected to open during the 2024 summer season. Following its completion, the airport will have the capacity to handle 1.5 million passengers per year. Air Serbia has also expanded its operations in Niš by opening a call centre in the city, as well an aircraft balancing service. Earlier this year, it announced it would open a business lounge at Niš Airport’s new terminal upon its completion.
No prizes for guessing who is going to win.
ReplyDeleteAnd? Where is problem?
DeleteI don't see an issue. Tax payers money stays at home.
DeleteI see a problem and I am real taxpayer, feeding them with lot of money every year. I don’t want to put money to inefficient sns pockets, which is the exact purpose of PSO.
DeleteThe purpose is for other areas of the country to has scheduled flights.
DeleteThe sole purpose is to find the ways to pump money to JU, while avoiding EU state aid regulation that JU/state needs to obey.
DeleteNonsense.
DeleteMany EU companies including OU are receiving huge amounts of PSO money and it is perfectly in line with EU regulations.
Unlike the PSO in Croatia, oh wait...
DeleteThe whole point is for INI to get a reliable partner who will not come and go as it pleases but will commit to the market.
DeleteSay what you will about them but these smaller markets have profited from JU and OU operating these PSO flights.
INI will avoid going through the same hell as many other smaller airports in the region who were left at the mercy of LCCs such as Wizz Air and Ryanair. INI management has seen what both Ryanair and Wizz Air have done to TZL. That is why they see Air Serbia as a reliable partner for future growth.
Anyway INI-HHN has become an extremely popular line so in retrospect it was good that the government banned Ryanair. I suppose this route would have cut the same way they cut ARN (in winter), BGY, TXL etc.
wouldnt call it "extremely popular" but compared to their Köln/Bonn route OK:
Deleteheres form the official german statistics for 2022:
Hahn-INI: one direction 187 flights, 21 278 pax, LF 61,8%
Köln/Bonn INI 2022: one directions 104 flights, 6 040 pax, 37.2%%
Yes that was for 2022 while this year numbers are better. In summer there were very few flights with less than 100 passengers. Around the holidays flights were sold out. This route has definitely matured and I hope they add a third weekly flight at least in summer.
DeleteBtw when this route was launched there were like 20 passengers per flight.
A PSO is probably only a small fraction of the amount given to the airline who will ferry passengers across to the country and they will use airport services, local city services such as taxis and hotels, restaurants, shops, etc. It's a small investment for a better return to the locals. Imagine these 350K passengers spent €100 each in INI. That's directly funding local jobs. Far better way to invest long term for the region.
DeleteNot just that, it's also a way to reduce the number of people who are from Serbia and who were using airports such as SKP or SOF in the past. By linking gasto epicenters with INI they are also making their homeland more accessible so people can fly back home more often. All in all this can only be evaluated as something positive.
Deletewhich 350k pessengers?
DeleteThe ones that fly in INI, although not all used AirSerbia.
DeleteIt's actually not hard at all to guess who will win: the lowest bidder will win. That's how PSO tenders work. If no one else applies, that's their decision. But the bidding is open to all airlines, perhaps with an EU certificate etc.
DeleteIs it to early for Air Pink to apply or..
DeleteWill it be the same destinations as up until now or they will change them or some?
ReplyDeleteI hope they bring back Kraljevo-Vienna.
DeleteKraljevo - Vienna would be great. I checked fares from Kraljevo to Istanbul and tickets wasn't cheaper then from BEG.
DeleteINI-BUD ;)
DeleteYour mean provocation is just ridiculous and pathetic, Anon 14.55 and you know it. Yes, INI -BUD failed before Corona, so lats brag about it forever, despite other lines making better results.
Delete@17.33 same as your "paid routes" provocation
Delete@17.33 BUD was a joke, everyone knew it. It failed by intension and as a result, airserbia got much more money.
DeleteSo they will put tickets on sale days before the flights start?? What is the logic in this?
ReplyDeleteExactly my thought
DeleteThey need to wait for the budget to ne approved.
Delete*to be
DeleteIt was the same last two times as well.
DeleteTickets will probably go on sale earlier this time, since the budget will be adopted in early in November.
DeleteAnother example on how not to do business. Instead of approving the PSO ahead of time they are leaving it for the last minute thus preventing people to purchase tickets for one of the busiest period of the year (N.Y. / Christmas holidays). They could have extended the current PSO to end of January or even better initiate the validity of the PSO fro another time frame not corresponding with Dec 31st. Another example of great thinking and planning!
DeleteI guess the trick is that the route shouldnt be in the GDS for the period after the current PSO runs, since that would mean the route is commercially viable, thus to maintain the route alive no PSO is needed. EU rules and logic.
DeleteAnd what happened to the theory that Air Pink will operate some PSO flights.
ReplyDeleteAlthough still theory I think it's not that bad idea. AirSerbia would get rid of what they are basically forced to do, airports would keep the flights and potentially increase the destinations and frequencies, passengers would have good solution and more options and it would cost less per flight. So it's win for all... of course, if Air Pink is able to acquire planes on such a short notice.
DeleteThey could wait for 2025, but risk for AirSerbia to have suficiente fleet size to operate those PSO's by itself.
DeleteIn theory, could KVO flights be operated by Air Serbia's ERJs?
ReplyDeleteYes, they could
DeleteBut they won't. The ERJs are fully employed on flights from Belgrade.
DeleteCongratulations and good luck.
ReplyDeleteI really do not see why to subside summer destination like Tivat in summer. It definitely isn't unprofitable. Just no sense
ReplyDeletei think ljubljana is also profitable on ATR
DeleteSo tickets are cheap and accessible to local population
DeleteI think airlines simple love PSO no matter if the route is profitable or not.
DeleteJust have a look on ZAG-SPU or ZAG-DBV during the summer.
If Air Serbia plans to open a lounge in Nis, does this mean they plan to offer business class from Nis?
ReplyDeleteIt would be a smart choice. One row of business.
DeleteHope so
DeleteWill they keep Ljubljana? How are they performing on this route?
ReplyDeleteI m pretty sure they will keep it.
Deleteyou had a trip report few days ago.
DeleteEvo ga Air Pink PSO Limited.
ReplyDeleteNot going to happen
DeleteIt would be nice to have several other Serbian airlines
Delete'Several other Serbian airlines', market is way too small.
Deletenot too small, just too price sensitive. but it could have one or two more airlines if the were low cost like ryan air.
Delete"The total value of the contracts awarded to the Serbian carrier over the two-year period amounts to around 23.8 million euros."
ReplyDelete23.8m wow
Yes, for two years. OU gets 11 million per year for half the number of routes.
Deleteand people were slamming SKP for their peanuts incentives
DeleteThe issue with Skopje is that the airline you are subsidizing can pack and leave tomorrow if it wishes. Not to mention you are subsidizing a private company from Hungary.
DeleteWell it seems this time around the PSO budget will be smaller.
Delete"Last week, the Serbian government adopted a draft of the Budget Law which allocates 5.2 million euros in subsidies for air transport for 2024."
Adria Airways used to get €4.5 million per year to fly from BRU to LJU.
Delete@9.48 lol sure
Delete@9:46 Outta all ex-Yu airports, SKP is the one with the highest paid traffic and just like somebody mentioned here, W6 can pack up and leave tomorrow if the money stops because it represents 75% of the airport's traffic. JU story in INI is a bit different and not that extreme because INI is not a capital city.
DeleteIt seems that people here keep forgetting that PSO routes that JU flies are much longer than ZAG-SPU, ZAG-DBV, OSI-DBV etc...
Delete@10.16 highest paid traffic? LMAO !!!! 1.1mil per year for such a huge base ?!? haha!! Compare it to the 23mil from the article, ZAG's incentives, Slovenias number, Airports of Montenegro subventions ...
Delete23 million is not for one year. And again Nis isn't Serbia's capital city.
Deletestil 11.5m for ATR routes
DeleteAgain, you obviously know little about this PSO. Majority of PSO routes out of Nis are operated with A319 aircraft.
Deleteif JU has 200k passengers at INI that would be 57,5€ per pax yearly
Delete10:16 subsidies in SKP are only for new routes. In 2022 was 1,1 million euro which. This year the subsides are also per departing passenger.(7 euro). But these count only for Ljubijana Luxembourg and Frankfurt. I don't think they really need it but they know they can get free money and they play the game smart. Compared to JU and OU W6 get's peanuts from the government. W6 employs a lot of people in SKP and increased traffic a lot. More traffic is more taxes payed. SKP is also one of the most profitable bases for W6.
DeleteW6 is since 2012 in SKP. It had it's up and down but overall quite reliable.
"SKP is also one of the most profitable bases for W6."
DeleteI'm not saying it isn't but I highly doubt you have that sort of data.
12:52 no but many factors play a role. The prices of tickets, staff that is less payed than other wizzair bases, w6 didn't cut flights in SKP but did in many places in EU and also have no concurention in SKP.
DeleteWhat exactly is a point of a tender? Who on earth is going to get right to fly domestic flight within Serbia
ReplyDeleteWell, you gotta play the game.
DeleteThey might as well introduce Belgrade-Kraljevo too.
ReplyDelete+1
DeleteIt's a pitty you can't fly from BEG to INI in the morning and return at night on the same day.
DeleteAgree. Wanted to go to Knjazevac a few weeks ago and thought how great it would be if I could just go in the morning by plane to Nis and come back in the evening. But the flight schedule does not allow it. The bus/train ride takes half a day,
DeleteExcellent news for INI and KVO.
ReplyDeleteHow can a route to Hahn be "of public interest" in general for any country :D
ReplyDeleteSo. Half the country moved out...
DeleteSerbians who live abroad actually use this route to bring money to Serbia.
Deletethe route is astronimically paid for why not move it to FRA then
DeleteYes, FRA with its slot problems only wait JU to come with INI PSO route...
DeleteNext time I expect to see suggestion for INI-LHR as PSO 🤣
Well, they do want flights to the UK :)
Deletehttps://www.exyuaviation.com/2023/08/nis-seeks-uk-flights.html
at least they can then claim it to be of general interest
DeleteYes, they want flights to UK, but LHR is mission impossible.
DeleteAirPink begins transferring aircraft to its subsidiary Air Emeralds. The planes may still be theirs - I don't know. They will probably focus on Embraers.
ReplyDeleteProbably they'll be in Nis.
DeleteI think several routes will no longer be PSO, like Kraljevo-Istnabul, Nis-Istnabul, because these routes are performing really well. I think they will use the funds instead for establishing new routes while the likes of these two will stay.
ReplyDeleteAir Pink wins the tender for PSO.
ReplyDeleteIt won't even apply for the tender. You will see. JU will continue flying them.
DeletePlease bring back KVO-VIE and work out some code-share. Hopefully TK will sort out the codeshare so that KVO-IST can be purchased online.
ReplyDeleteI think that OSI-ZAG is a PSO champion where for each seat it has been paid 599 EUR!
ReplyDeleteIn 2021 OSI-ZAG per pax was 2.401€…
DeleteWill AirSerbia have to specifically promise the type of aircraft and frequencies, or is it just capacity based? If it's capacity based, AirPink could still very well be the winner on a long run, operating under AirSerbia brand, like Marathon is with E195s
ReplyDeleteCapacity is listed in the tender requirments. At least that was the case in the previous two tenders.
DeleteThen the AirPink will operating for AirSerbia in the summer for sure
DeleteSoooo.. Any guess on potential?new routes from KVO and INI? (aside from those currently served)
ReplyDeleteKVO-LHR
DeleteBravo INI , Bravo KVO !
ReplyDeleteKVO-MBX for the win! (Partner municipalities)
ReplyDeleteWhy the ferry flights BEG-KVO-BEG can't be used for pax?
ReplyDeleteWho will fly BEG KVO? With 1h drive on a highway? Only couple of transfers.
DeleteMy predictions :
ReplyDelete- daily BEG-INI flights
- introduction of BEG-KVO flights
- new routes including CDG, BER, Italy, UK
- maybe a new JU’s base at INI ?
+ reintroduction of KVO-VIE
DeleteCorrection : "new routes including CDG, BER, Italy and UK from Nis."
DeleteWith this traffic, INis will reach 500,000 passengers in 2023. So far we hope for more in 2024 and additional new destinations (about 15). A based aircraft would also be perfect. That is, if we take BEG and Nis in 2024 we will have 9 million passengers!
ReplyDelete500 000?
ReplyDeleteAir Pink would be perfect for Kralevo. 10 destinations can easily be supported. Hope AirPink participates in the auction. It will be interesting to see if their plans for scheduled flights.
ReplyDeleteSlazem se sa Vama Anon 21 : 23. Fleksibilnost flote uz mogucnost nabavke jos aviona do 100 sedista, Er Pink bi mogao da razvija saobracaj sa Aerodroma Nisa i Kraljeva. U buducnosti i sa buducih aerodroma u sastavu Aerodroma Srbije. Kao sto su Ponikve, Rosulje, Bor... Buduci aerodrom Novi Pazar. Koji bi se koristili za saobracaj sa sekundarnim aerodromima u Nemackoj, Austriji, Svajcarskoj, Grckoj. Ukljucujuci i sekundarne aerodrome ovog regiona. Buduce oji ce se graditi racunajuciTrebinje, Valonu, Bihac...
DeleteAerodrom Beograd je hab i velicina za sebe. Sa projektovanim kapacitetom od petnaest miliona putnika na godisnjem nivou. Zbog razvoja privrede i turizma Srbije, vazdusni saobracaj ce se uvecati i prosiriti. Mnogo je onih kojima je tekst neprihvatljiv.
Ko zeli da vidi razvoj Srbije, videce i razvoj i prosirenje komercijalnog saobracaja i mreze opsluzivanja ljudi i biznisa.
Rodney. 😀✈🌐🛬🇷🇸✈