Croatia Airlines aims for long haul flights

Croatia Airlines looks to expand following restructuring program

Croatia Airline’s CEO, Krešimir Kučko, has announced the carrier is planning to launch long haul flights sometime in the future. The CEO admits they are still a long way off but adds they are the airline’s ultimate goal with the current restructuring program setting a basis for future long haul operations. “There are new challenges out there and there is potential for commercial cooperation. It is important that an airline considers the other side of the equation too and continues to innovate and find new revenue streams. A sustainable future won’t happen if you concentrate on cost reduction alone. The dream is to one day add long haul flights to our network. That’s a long way off at the moment but it’s good to have something to aim for and we are building our airline to make it possible”, Mr Kučko says. He adds that Star Alliance is “vital” to Croatia Airlines’ long term plans.

Croatia Airlines’ five year restructuring program, which has seen the carrier cut down on its network, fleet and employees, is almost over, according to its CEO. “It finishes next year. We have executed about 80% of the program so far and there is no reason to think that we won’t achieve everything we have planned. The program cuts across every part of the airline. It’s about efficiency - making sure the airline is set up to achieve its mission in an optimal fashion. The proof that the restructuring program is the right thing to do is in the figures. Last year, we had a profitable twelve months for the first time in many years. Of course, you always wonder how it will work out but it’s going very well so far”, Mr. Kučko says.

Next year is set to see the Croatian carrier expand with new routes and the possible lease of new aircraft. Recently, the airline announced the launch of new flights from Dubrovnik to Nice on the French Riviera, next summer season. “Once we finish the restructuring, we will have far more flexibility to pursue our plans. One item on the agenda is new aircraft. In particular, we are interested in obtaining something in the 100-seat market as a means of bridging the gap between our turboprop fleet and the Airbus fleet. This would rally help us consolidate our position in the market and achieve the full potential of our new network strategy”, the CEO says.

The Croatian government will try to sell a minority stake in its carrier this autumn, following a failed attempt late last year. However, Mr. Kučko has opposed the privatisation and is in favour of the airline remaining Croatian-owned. In the era of mergers and acquisitions, the CEO believes there is still space for smaller airlines. “There is definitely room for the small airline. There is a need for connectivity that won’t be satisfied by the bigger carriers. In summer, we have about 20% of the market but in the winter we have a 70% share. And yet, it is the summer that is profitable! So, there is an interesting dynamic at play for smaller airlines and the way they serve the market. In any case, the industry needs us to keep the bigger carriers on their toes”, Mr. Kučko concludes.