Air Serbia says it is prepared to absorb the current market volatility in the short-term and has put in place measures to reduce costs, such as renegotiating with suppliers. Speaking to the “Kurir” daily, the carrier’s CEO, Jiri Marek, noted, “It is important to emphasise that Air Serbia is not entering this global shock from a defensive position, but from a stage of full operational maturity. Everything we have achieved in the post-Covid period, from record revenues to an all-time high number of passengers, has been directed towards building a company that is both financially and operationally robust”. He added, “Precisely because we made thoughtful and strategically grounded decisions during the years of expansion, we can now confidently say that our long-term goals remain firmly intact. We continue to build the future on the foundations of stability and trust that we have painstakingly established over the past period”.
However, Mr Marek noted, “Because of this complexity, we have approached the issue from multiple angles. We have actively engaged with our suppliers and long-standing partners, seeking support through discounts and additional benefits in service delivery, so that we can share the burden of market pressures together. At this point, we would like to express our sincere gratitude to all those who have stood by Air Serbia during this challenging period, recognising the importance of maintaining stable operations”. The CEO added, “Our goal is to navigate this turbulent period while preserving our traffic volumes, fully aware that passenger trust, as well as the trust of our partners, is the foundation on which we are building the future, and one that must be protected above all in times of sudden market disruption”.
Mr Marek said that should the ongoing crisis, resulting from the conflict in the Middle East, persist, the airline may be forced to undertake more drastic measures to preserve its stability. “We must remain responsible towards the future and clearly communicate the realities of the market. While our current position and sound business policies allow us to absorb these “shocks” in the short term, it is important to understand that internal capacities to mitigate such external pressures are limited. Should these negative global trends persist over a longer period, additional strategic, and potentially more radical, decisions will be required to ensure the stability of the system”.
Air Serbia handled its millionth passenger of the year this Monday, on a flight from Belgrade to Malta. The traveller was awarded with a gift and upgrade to business class. The millionth traveller was handled two days ahead of last year. During the first quarter, the carrier welcomed 813.188 passengers, meaning it handled 186.820 travellers between April 1 and April 20. The airline had previously adjusted its schedule for the month, reducing its planned operations.
Renegotiating with suppliers is smart actually.
ReplyDeleteThey did the same during covid. Very smart.
DeleteI'm pretty impressed by the fact they are launching 10 routes, building that much needed hotel at BEG and the way they reacted to the CityLine closure.
DeleteAir Serbia’s growth over the past few years was often criticised as too ambitious. Now that expansion may actually be what gives it scale to negotiate better deals.
Delete^ true
DeleteThey are handling it better than Lufthansa lol
ReplyDeleteOf course when they are a tiny fragment of LH.
DeleteJust Luftica returned all money received from government as a help during COVID. Not sure Air Serbia did?
Delete^ yes they did actually. There were articles published here too. JU also has to pay majority of its profits back to government budget each year.
DeleteSure sure. They receiving money and returning it to the budget. Interesting
DeleteAnd where are they receiving money other than for PSO? Show any evidence please.
DeleteHe does not have any but don't worry, it won't stop him.
DeleteAnd to whome should they return the money? To you maybe?
DeleteJust another zama clown. Air Serbia publish yearly reports with huge profits, that’s what is hurting him
DeleteMaybe better to check some secret part of that PSO contract, which aren't available for public. What you think, why they are secret?
Delete^ interesting that you know the secret. They told you about the secret
DeleteThe PSO agreement is actually public and you can access a scanned version of it on Ministry of construction, transport and infrastructure website in full without any redactions. There are no secret clauses in it.
DeletePublic version is. You can ask Ministry, you will get response.
Delete^ you have the private version? Lol
DeleteHe is only mentioning pso because someone else mentioned it. Otherwise he would not have even remembered it.
DeleteI don't have it, because it's not available for public. Aks Ministry, it doesn't cost anything. Ministry is obligated to answer
Delete😂 😂😂
DeleteThe ministry has the 'secrete' which they have to give you. You don't know about it, you don't have it but you know there is a secrete. How old are you?
DeleteNo, he’s writing about secret government plot to fund Air Serbia, so neighbors will envy them
DeleteHow could be secret, if ministry will provide it for you?
DeleteWhat a clown. Lol.
DeleteImate na forumima da je nekoliko ljudi tražilo po informacijiama od javnog značaja da im kažu koliko je para uplaćeno po PSO. I na svaki su dobili odgovor da su dodatni troškovi isplaćeni koji su tajna po ugovoru. Malo istražite pre nego što prozivate ljude
DeleteLH is a private company, JU is not, it’s owned by state. It makes huge difference when it comes to paying back the money to the state. Cause no one here asks LH how much money their owner throw into company and do they pay back in the form which is not a dividend.
DeleteGuys, EU is regularly monitoring Serbian aviation. No huge problems with financing detected. Please don’t be bigger pope than the pope.
DeleteIt does not fit their narrative.
DeleteBravo Air Serbia 🇷🇸🇷🇸🇷🇸
ReplyDeleteThis sounds positive, but I’d like to know what specific cost reductions are being considered beyond supplier discounts. Are we talking deferred investments, reduced frequencies or something bigger?
ReplyDelete“radical decisions” could eventually hit passengers through higher fares, reduced frequencies or postponed product improvements. Stability often comes at a cost.
DeleteThe bigger question is whether these pressures will affect the planned premium lounge, loyalty programme rollout or other non core projects
DeleteI would expect to affect it and would recommend that.
DeleteI find it interesting how different the approaches are between JU and OU are. OU is closing 6 routes, JU opening 10 at the same time.
ReplyDeleteYou have to keep in mind that
Delete1. OU has burden of new aircraft arrivals that need to be paid
2. It received state aid in January before this crisis even began so that it could survive
3. It was loss making even before the crisis began.
So it makes sense that they are going to take more painful measures
Air Serbia seems to be trying to ride out the turbulence rather than retreat.
DeleteWell you definitely think different way when you have 45 mil in pocket compared to having -30 mil in pocket…
DeletePassenger growth has definitely slowed.
ReplyDeleteCompetition has also increased in the form of Wizz
DeletePatience please. None of new routes even started yet. Summer season only started now
DeleteYes but there are reductions in charter ops because there is less demand this year
DeleteCharter ops has been reducing over the past couple of years as several previously charter routes are now scheduled summer seasonal routes such as JTR this summer.
DeleteThat is more the fault of tour operators, JU is just a contracted transport party there.
DeleteNoticed the same about slower growth, but again, it could be that JU's market share has dropped again. Nothing new.
DeleteLast year, JU reached 1 million pax two days later, which means that right now it is currently advancing with some 10k-20k extra passengers.
I wonder if supplier renegotiations include airports, lessors or fuel related contracts. If so it shows quite a broad strategy rather than simple cost cutting.
ReplyDeleteIn translation he says we are stable, but don’t expect us to be immune. That is probably the most realistic position an airline can take right now.
ReplyDeleteRupic said that ticket prices will go up. But not for one million already sold in advance so far
DeleteIf they launch the FF program this summer then overall I'm pretty happy with how this summer is turning out from them.
ReplyDelete+1
DeleteWe’ll see about that. FF is for beating the competition and if competitors start decreasing, do you need loyalty program? But maybe it’s good to roll it out now and make it work for the “normal” business time.
DeleteFFPs are not for "beating the competition", that's a POV from 20 years ago. These days they are a profit centre first and foremost, owing to partnerships with banks, rental car companies, hospitality providers etc.
DeleteGood luck with that. That would be the first one successful in Serbia.
Deleteif fuel stays high into winter, some of the optimism around 2026 plans may have to be revisited.
ReplyDeleteI’m less interested in corporate language and more interested in whether ticket prices are about to go up.
ReplyDeleteYes they are
Delete😭
DeleteEveryone is increasing fares. Fuel prices have spiked compared to last year.
DeleteNo, with all the inputs going up (fuel, salaries, inflation…), the prices will go down……..
DeleteSounds like the airline is buying time and hoping the geopolitical crisis fades before tougher decisions become unavoidable.
ReplyDeleteSame as 95% of businesses today, not just in aviation…
DeleteI would rather see them postpone growth than stretch finances trying to prove a point.
ReplyDeleteIf other airlines retreat and Air Serbia holds capacity, this could actually be an opportunity. First such example is the Luftahansa cityline debacle and them starting Munich.
ReplyDeleteSo far we have CityLine and TAROM.
DeleteTheir main competitor in Belgrade is Wizz Air. And they are not retreating.
Delete*not just in Belgrade but in Serbia in general
DeleteYou don’t have to take main competitors share to grow. It’s the best, but not the only option.
DeleteNice pic :) is YU-ATB the Embraer that was all white but was painted recently?
ReplyDeleteNo the one painted that was all white is YU-ATC.
DeleteAnd now it's painted. No white aircraft in JU fleet anymore.
DeleteI can spot Pupin's eye in the distance :D
DeleteWhere is jet fuel coming from, how long will reserves last and what are the chances of running out of fuel is this conflict continues for another month or two?
ReplyDeleteMr Rupic says they have reserve for a month and a half + they refill on foreign airports. They get it from Pancevo.
DeleteНИС производи гориво. Дружба кроз Украјину је отворен за Мађарску и Словачку. Нафта из Русије стиже. И кроз ЈАНАФ (отет, украден) долази нафта до Панчева. Ускоро почиње да се ради нафтовод Србија-Мађарска. Кроз Дружбу, осим руске нафте тече и Казахстанска нафта. Зато не брините.
DeleteNe prerađujemo rusku naftu u Srbiji.
Deleteda li AirSerbia uopste kupuje naftu od NIS-a,
Deleteposto su pod sankcijama