The Slovenian government is still considering establishing a new national airline, almost five years after the former flag carrier, Adria Airways, declared bankruptcy. According to the State Secretary at the Slovenian Ministry for Infrastructure, Andrej Rajh, discussions regarding the formation of the new national carrier are ongoing and still on the agenda, Last July, the Slovenian Parliament’s Public Finances Oversight Commission proposed for the state to enter into a strategic partnership with an established airline in the process of forming the country’s new national carrier. Acknowledging that the process of setting up a new airline could take several years, the government has previously said it would only do so through a Public Private Partnership (PPP).
The companies Melkom and Fabce, which were commissioned last year by the Slovenian Ministry for Infrastructure to undertake a study on ways to improve the country’s air connectivity concluded that launching a new flag carrier could be economically viable. According to the study, at least 300.000 passengers from Slovenia are using alternative airports outside of the country for their travels. The study found that in case of a PPP, the national airline would break-even in its seventh year of operations. The cumulative loss in such a case would reach 35 million euros in the sixth year, and after the tenth year it would amount to 28 million euros. The authors of the study estimated the private partner would have to make an initial capital injection of at least 35 million euros, or seventy million euros in the case of a more ambitious network.
According to the study, if both the state and the private partner invested fifty million euros each, the airline would be profitable within ten years. The study further points out that in order for the airline to become profitable, it would have to have an average cabin load factor of 64%, while its fares would have to amount to at least 134 euros. It further stressed the new airline would have to be lean, commercially successful and, at least initially, conservative in its business model. The Slovenian government has noted that despite plans for a new national carrier, it will continue with its policy of subsidising foreign carriers in a bid to improve the country’s connectivity in the short-term, with a new public call to be launched soon.
They should just stop with this nonsense
ReplyDeleteNonsense is paying 16million in 3 years and not having a national carrier, that could be set up for 10mio
Deleteit says in the article it will be 100 million € and non profitable for at least 10 years... and with fares minimum 134€ one way it will never reach load factor of 64% on all the routes. so yes, it is better to put a fraction of this money every few year for subsidies
Delete"Slovenia still committed to new flag carrier"
DeleteMy first thought was "of course, where else are they going to steal money from?" Adria was a huge free-for-all for many governments, and it was only sold after barely anything could be stolen from it. Now let's give that another try! Yupee for anyone who cannot get a doctor to see them, but they will have a NATIONAL carrier. All is well under the Alps.
@ 9:04
DeleteYes, for 10 x 50! Remember Adria: 50 million, 30 million, 8 million, another 25 million. It soon amounted to a quarter of a billion. Plus these foreign carriers are well known names in their respective markets, SLO's national carrier would be unknown. Slovenia as it is, is barely known outside its neighbouring countries. If you'd travel more, you'd know that.
I really do not understand why JU doesn't make a sister-airline to be based in Ljubljana (brand it Adria 2.0 or whatever Ljubljana likes). It would be able to expand its operations in the EU and also utilize BG as a base for inter-continental flights (as opposed to whichever other EU legacy would do so). So, instead of LJU flights automatically being forced through FRA, CDG or MUC for flights to the US/China - it would be thought BEG. It's not HUGE money, but it certainly ensures the loads are a little more secure, which enables greater expansion.
DeletePlace nova vlada za takvim genijem. Zasto bi Srbija finansirala Slovence koji lete iz Venecije, Klagefurta, Trsta, Graza, Zagreba?
Delete@11:57 its political block that would prevent JU from doing anything like that. even if it got government approval from the Slovenian government, it would be blocked, severely impeded by other EU politicians/ organizations. Same reason JU could not do it in BiH or Montenegro or Macedonia.
DeleteThat's why we constantly see EU airlines just stealing and blackmailing from the JUG nations for more money. like the EU LCC's that steal from BiH. opening up a base they new wouldn't work taking money and leaving. The EU will never allow a serious regional airline to grow and develop in the Jug which will challenge Lufthansa group control over the region or the other western airlines.
@Slav Man is unfortunately right. Post 1990s a number of airlines stepped in and took the market share from JAT. Their governments will do anything to hold on to it.
DeleteCould this have something to do with Cyprus Airways?
ReplyDeleteWould be strange if not. Radio silence for a whole year and suddenly when Cyprus Airways came in with a proposal there're talks about a new airline
DeleteI watched the last years conference, and they said that the perfect scenario would be finding a 50/50 partner. And as the idea was that 50/50 would mean the other partner brings in AOC and airplanes, I think the ideal scenario here is Cyprus Airways actually offering them 2 A220, as a start, and gov paying for the staff salaries.
ReplyDeleteWould work great, the aircraft is the right size, the AOC is there and they (cyprus) are seemingly ready to start in the winter, as two more A220 join the fleet
+10000000
DeleteThat's a great idea!
Why waste money on a national airline? The government should use just 20% of the money they would spend on establishing a national airline to attract other carriers.
ReplyDeleteThey are wasting it much more now and we dobt have any connectivity
DeleteI still have my hopes for a better future of Slovenian aviation.
ReplyDeleteThen, the key people at the Ministry for Infrastructure should be replaced. Ms Bratušek appointed her own party aparatchik as the CAA director who does the job on a part time basis. She replaced a very enthusiastic aviator with a guy that has no clue about aviaition. She is blocking any development of Maribor airport until a new operator is found for which only Fraport, Vinci, TAV and the likes can apply. She does not recognize any other succesful aviation companies in Slovenia. Aviation in Slovenia is so much more than LJU and the supposed "new Adria".
DeleteThe gravediggers of Slovenian aviation are now leading Slovenia.
Deleteits very hard to make a new national airline with not so big population…
ReplyDeleteShould have stayed in YU then (joking)
DeleteA national airline isn't just purely about profitability. Yes, it should not bleed money but a national airline is of strategic importance (which we saw during covid), it is about improving the country's connectivity, using it to improve tourism, nurturing aviation sector and related industries (which have now all been destroyed in Slovenia).
ReplyDeletecan you tell us more about which aviation idustries have been destroyed in SLO? As far as I've heard everything is booming sice 2019 except for a carrier situation...
DeleteI'm not the guy at 9:13 but flight schools have suffered a lot as simply no one wants to be a pilot anymore since there is no home based airline.
DeleteAlso I remember lots of hotels bleeding money because of the fall in international visits
DeleteWhich hotels? The most passengers were transfers from Macedonia and kosove?
DeleteI'm almost certain there will be no new national airline launched. If they decided to invest 17 million into subsidizing new routes, why would they invest in a flag carrier?
ReplyDeleteOut of those 17 million; not even one million was used after 3 tenders
DeleteIt's a shame Amelia didn't start scheduled flights from LJU
ReplyDeleteWorth noting that Amelia has a larger fleet than Croatia Airlines and the second largest fleet in ex-Yu.
DeleteAre they profitable?
DeleteImmensely
DeleteThat's very good to hear.
DeleteI assume they do well since they fly PSOs for Air France.
DeleteJU have over 30, Airpink 22-23 it is number 2 not Amelia.
DeleteIn which world does JU have over 30 planes?
DeleteAir Pink no longer exists.
DeleteLooking at it now, it was cheaper and easier if the government just gave Adria 50 million 5 years ago and saved the airline.
ReplyDeleteRemember the EU state aid rules. It would likely be determined to be illegal later on.
DeleteAnd 50 million a year after, 80 million in 2022 and so on....
DeleteEven if they decide in favor of a new airline which I doubt it will take at least until summer 2026 for it to launch, at best.
ReplyDeleteDepends what kind of model they choose.
DeleteNot unless they partner with another airline.
DeleteI am pretty sure that this Cyprus Airways talks have something to do with this. It would be great, when they recieve more A220s they can station them at Lju and they fly for Slovenia airways or whatever it would be called
ReplyDelete+1
DeleteIt's a big political decision, that is for sure.
ReplyDeleteWill the EU allow it though?
DeleteSay they decide to launch an airline, what is going to be the concept? They will compete against Lufthansa group on the most profitable flights to Frankfurt and Munich? They will start unserved routes? They will try to be a new Adria by connecting Balkans to the West?
ReplyDeleteGood question
DeleteThey wouldn't compete against Lufthansa group. There would be more than enough space for the new airline to launch flights like Frankfurt and Munich since the routes are underserved.
DeleteThey would probably start with flights to Madrid, Prague, Barcelona etc… which are unserved and also fly to Amsterdam, Copenhagen, Frankfurt…which are underserved
DeleteWho says or based on what we can say the routes are underserved? If there were such a larger demand for those routes there would be an airline to turn this demand into a profit, but I guess there isn't?
DeleteKeep in mind, FRA and MUC are so profitable because of the transfer opportunities. The new airline would first need to codeshare with Lufthansa if they'd want to start these routes. Most likely, it'll be p2p demand at first
DeleteMELKOM = MATEJ ELJON KOM, ZERO EMPLOYEES, DIRECTOR MATEJ ELJON
ReplyDeleteFABCE = FUNCTIONAL BLOCK OF AIRSPACE = JOINT VENTURE OF 6 ANSP (+BIH), 1 EMPLOYEE, DIRECTOR MATEJ ELJON
Those are two companies entitled to produce feasibility study of a national carrier.
Matej Eljon has a masters degree of electronics, use to be head of technical department in Slovenia Control, has a lot of knowledge about electrical devices, lighting systems,VORs, NDBs, DMEs..., but ZERO experience in commercial aviation, but he knows everything about it. On some other aviation portal we know the person of that potencial under nickname 'analitičar'
Seems legit haha
DeleteReally hope it happens!
ReplyDeleteSlovenia needs this.
ReplyDeleteWould be nice to have an airline based in Slovenia.
DeleteLet's say Adria is relaunched, which routes could be started from LJU?
ReplyDeleteMorning/evening flights to EU hubs, mid rotation to Balkan destinations.
Delete^ That is Adria 2.0
DeleteBerlin, Madrid, Barcelona, Amsterdam, Prague, Vienna, Bucharest, Sofia, Rome, Sarajevo, Tirana, Lisbon, Manchester, Stockholm, Oslo, Dublin…some of those probably
DeleteThose destinations seem workable. The new Iberia flights from Madrid that last a month are an absolute joke.
DeleteMuc / zrh / bru are most important and they are still not recovered
DeleteGood luck.
ReplyDeleteSlovenia is a beautiful country and they deserve to have good national air carrier connecting Ljubljana but also Maribor to the other European cities.
DeleteIt would be great to have a local airline back in business
ReplyDeleteThis is the best chance for locals to get new employment opportunities. So I really hope they agree to provide some funds to set up an airline.
DeleteIf launched correctly I think it could be successful.
ReplyDelete+1
DeleteThe government has tried to give money to foreign airlines and it didn't produce fantastic results. Now it is time to try and get a national carrier to start flights.
ReplyDeleteActually, the results are not bad at all.
DeleteWell they are not really great…three airlines or four if you want to count that few Iberia flight to Madrid…and for three or four tenders that really isn’t a great outcome.
DeleteIf not more foreign airlines are interested in serving LJU, what do u think, does this mean for a new national carrier?
DeleteThat it need to happen becouse if anybody elso won’t do it than a national carrier need to do it.
DeleteThis wld be needed if no one or just 2-3 airlines wld be flying. But u hve this Summer 25 scheduled destinations with 22 airlines, plus over 50 charter destinations. Thats not great, but quite ok
DeleteNumber of destinations does not mean a lot in aviation. Its frequencies and time of dep/arr which are more important then destination itself
DeleteConnections at the hubs are important and I think with up to 7 daily flts LH and LX u reach the most important cities in the world. In addition u have TK JU AF FZ with further destinations u reach. Again, not great, but quite ok. Could be worse....
DeleteIf there is a demand Slovenia should support its own air company and not foreign
ReplyDeleteI doubt the government will choose this option in the end. It is more expensive then giving subsidies for foreigners.
ReplyDeleteWe can see in the yearly results what is the outcome of relying on foreign carriers. Slovenia desperately needs it's own national carrier. Still 30% below 2019 and the slowest recovery in Europe.
DeleteI hope it materializes.
ReplyDeleteIt will only work as a money losing venture.
DeleteNot necessarily. With smart management it could actually work.
DeleteAll talk and no serious plans and activity. Like always
ReplyDeleteSlovenian aviation in a nutshell.
DeleteTrue
DeleteIf they go for it, please bring in a professional management. Thank you.
ReplyDeleteDid you say professional??We dont do that around here in Slovenian aviation
DeleteWell Mark Anzur is running Air Montenegro
DeleteHope they set up the new company on some healthy foundations and I wish it much luck in the future.
ReplyDeleteNot gonna happen
Delete@12:11... Elaborate why, pls.
DeleteBecause there are no well managed public companies in Slovenia. They simply don't exist and will never exist.
DeleteHasn't Slovenia sold most of its state-owned companies?
DeleteElections are coming
ReplyDeleteI really don't think a national airline is an election issue in Slovenia. On the contrary, it would probably negatively impact those advocating for it.
DeleteMy opinion is that it's just a waste of time. This would be a good addition to the current almost recovered LJU market. If a new national carrier is established, it will serve the same destinations as LH Group and the other airlines at the airport. It will also operate long-awaited destinations such as BER, MAN, ARN, OSL, DUS, FCO, BCN, . But I think that would also be covered by someone like airBaltic, Cyprus or SkyAlps. It's just money, money is needed.... Yes, it would be good for Slovenia to have a national carrier, but I think that would be easily covered by some other already existing carrier.
ReplyDeleteExactly, it would be much cheaper to go wtih the likes of Cyprus Airways who already has talks with the government than establishing a new carrier.
DeleteI think that is the idea here. I am certain this renewed interest from the government in national airline is related to Cyprus Airways.
DeleteLol, almost recovered trafic he said :) wake up please, we are still 30% behind on 2019.
DeleteA country with few slaves in Western Europe is normal for the resumption to be slower, don't forget the fact that about 250,000 passengers were transfers (that is, not Slovenians).
DeleteI can't understand this political sadness over the loss of JP! This money could then have been given to save the airline, or an auction could have been organized to attract an airline, with the conditions being - aircraft based at LJU. Anyway, Adria is gone and now the market is recovering and they keep talking about a new airline. There will come a time when Slovenia will have exceeded passenger traffic compared to 2019 and they will still be talking about a national carrier, even though the market is taken over by other airlines. Remember my words!
ReplyDeleteThe problem is the market is recovering way to slowly and has much more potential, evident by the fact that thousands of Slovenes travel from airports in neighboring countries
DeleteOf course it will recover to numbers we had with JP, but while we are gonna be happy to be on same level, other airport will have already 50%+ more passengers compared to same period.
Delete