Competition bites

More airlines hurting Jat

This summer Jat Airways is reporting a decline in passenger figures mostly due to the global financial crisis but also because of added competition in comparison to last year. However, it’s not all bad news. The Serbian national carrier has managed to beat some tough competition on certain routes. The airline’s chief of international sales, Jelena Pavlović explains. “The main reason we are reporting a passenger slump is because the number of flights have been greatly reduced compared to last year. The office which is reporting the greatest decline in sales is Sydney which covers the entire Australian market as well as New Zealand. This is because the termination of a special prorate agreement with Emirates Airlines. The office sold 7.9 million Euros worth of tickets in the first 6 months of 2008 while this year it has only managed 1.9 million Euros. In January last year Emirates decided to heavily increase its prices to the point that it was worthless for Jat to partner with the airline anymore. Jat signed a new agreement with Etihad Airways which is a developing airline that still hasn’t covered the entire Australian market like Emirates has. It will take time until the Abu Dhabi – Belgrade service stabilises however, we are extremely happy with the sales from Abu Dhabi this summer”. Pavolvić continues by sayng that the Belgrade – Amsterdam service is experiencing a decline in passengers because Martinair has terminated services from Amsterdam to Toronto leaving Jat without transit passengers. A decline is also being experienced on services to Istanbul compliments of Turkish Airlines which first offered 3 weekly flights to Belgrade but now offers 5 weekly services. The airline’s pains do not end there. Reduced passenger volumes were experienced this summer from Belgrade to Monastir as the charter carrier Nouvelair became the new competitor on this route. Similar results can be seen on the Belgrade – Tunis service with Tunisair becoming the more popular airline.

However it’s not all doom and gloom. The airline is reporting quite large passenger increases on services to Moscow (competing with Aeroflot), Paris (competing with Air France), London (competing with British Airways), Vienna (competing with Austrian Airlines), Zurich (competing with Swiss International Airlines), Stockholm (competing with Norwegian Air Shuttle) and Frankfurt (competing with Lufthansa) despite tough competition. Pavlović says that new code share agreements with some major world carriers will be ready by the end of the year. The airline has recently begun an aggressive campaign to lure passengers from Montenegro. It is offering tickets averaging 50 Euros for passengers travelling from Podgorica or Tivat to a European destination. While the campaign might boost passenger figures it won’t help the piggy bank.