 |
| Hungary to offer incentives for Sarajevo link |
The Hungarian government has announced plans to subsidise flights between Budapest and Sarajevo. It comes after the National Development Ministry initially planned to offer financial support for services from the Hungarian capital to Podgorica, Pristina, Skopje, Sofia and Tirana. However, last week, the government decided against subsidising flights to Sofia after Wizz Air announced it would launch the route later this year. As a result, Sarajevo has been chosen as an alternative. The Development Ministry will soon publish a concession tender in the European Union's Official Journal for interested airlines to operate services to the aforementioned cities. Any carrier registered within the European Union will be eligible to apply for the subsidies, although exact terms and conditions are yet to be released.
According to the ministry, the new routes will help boost trade and tourism. It further adds that financial incentives are being offered since a number of destinations formerly served by the national carrier Malév, which filed for bankruptcy in February 2012, are yet to resume. Malév used to operate daily flights to Sarajevo just prior to its collapse four years ago. Currently, Belgrade remains the only city in the former Yugoslavia with scheduled services to the Hungarian capital, served twice weekly by Belarus' Belavia. The Slovenian Minister for Transport, Peter Gašperšič, said last year that Adria Airways will apply to operate a number of subsidised flights from Budapest but gave no further details. The airline has bases in both Pristina and Tirana.
Budapest Airport says it is sees potential in the Balkan market, particularly within the former Yugoslavia, and is working on establishing better connections to the region. The Managing Director of Budapest Airport, Jost Lammers, says that, compared with the Malév-era, the airport's position has somewhat weakened. "The South Balkan region has not been covered by anyone, although there is significant potential. Travellers can currently only reach Podgorica, Sarajevo, Tirana and other Balkan destinations from Budapest via Vienna or Munich. These connections are missing. A feeder or regional airline would need to operate these flights with a fleet of regional turboprop aircraft of smaller capacity". So far this year, Sarajevo Airport has secured new flights from Sharjah, operated by Air Arabia, which launched last Friday, as well as Qatar Airways, which will inaugurate services from its hub in Doha to the Bosnian capital on September 7. However, Swiss International Air Lines will suspend its flights from Geneva next month, while Czech Airlines has given up on its plans to introduce services to Sarajevo this year.
Another good opportunity for Adria here.
ReplyDeleteMaybe with CRJ200 but they are retiring that plane. CRJ900 is too big for these flights.
DeleteIt's going to be subsidized so it doesn't really matter which aircraft they use. They also have CRJ700. I'm sure Adria will apply for these. They even flew Ljubljana-Banja Luka with an average of 3 passengers per flight while there were incentives.
DeleteEven with subsidies I could see Wizz Air applying for this route. The flight is relatively short and with the current oil prices their costs would be rather low. Not to mention that most passengers would not pay for luggage which means the aircraft would be relatively light.
DeleteWouldn't an A320 be too way too large for these flights?
DeleteI guess that if they operate two weekly flights it should be ok, especially with the subsidies and if they could get around 70 passengers per flight.
Delete@AnonymousMarch 23, 2016 at 9:08 AM:
DeleteIt will probably not be fully subsidized - if it was, ticket would be free, wouldn't they be? And look at how much profit Adria made in the year they flew BNX and see how good business this was for them.
I actually think this is a good opportunity for Croatia Airlines. Since these subsidiez will start during the winter season, OU could use this as an opporunity to base a plane in Sarajevo like they planned and open a few other routes as well with a Dash 8. Ivica Velican no longer being CEO of Sarajevo makes everything a bit more complicated for the since the guy was on their payroll as well.
ReplyDeleteI don't get the point. These flights worked for Malev because they were mostly transfers connecting on their flights in Budapest. If you are Adria, OU or whatever other airline you can only count on P2P.
ReplyDeleteThere is something fishy about that "huge market potential" if even lowcosters would not open the BUD-SJJ route.
ReplyDeleteThe high fees of SJJ is the problem
DeleteHigh fess, poor weather during the winter and corrupt management. They chased CSA away.
DeleteHoney they didn't chase CSA away with high fees and poor weather during winter, but with rejecting the SLOT at 0500 AM, SJJ doesn't open before 0600 AM. Get some info before spreading bullcrap
Deletelol airport the size of Sarajevo rejecting an airline because they can't be bothered to get off their lazy a**es early. Classy.
DeleteWait, did I get this right -
ReplyDeleteThey were planning on subsidizing Budapest - Sofia. Once Wizz Air launched the flights, they decided not to support the route?
???
Yep :D
DeleteBecause the subsidies were only for unserved routes. Wizz Air decided to launch the flights regardless of the subsidies so there was no point in offering support for a route already served. Same would happen if they started Budapest-Skopje tomorrow.
DeleteWhy would you subsidize route, that somebody else wants to fly and wants to make profit on it? Isn't it better to spend money on another route that nobody wants to fly, since it's not profitable?
DeleteAir Serbia failed on BEG-BUD as well. Now I'm not saying it's not their fault because they did have very high fares but they had a good aircraft for these flights and a connecting network. In fact, almost all the passengers on these flights were connecting passengers and very few locals. It didn't work for them and I think these other cities will struggle as well. That's why there are no flights to BUD at the moment.
ReplyDeleteOne of the reasons it didn't work, is because the Hungarian authorities denied Etihad the right to codeshare on the BEG-BUD route. A big chunk of the connecting traffic was coming from Etihad's flight and from their sales and distribution network in Australia, Asia and the Middle East
DeleteOT: Wizz Air profits to glide to top of guidance range (€200m – €210m).
ReplyDeletehttp://www.ft.com/fastft/2016/03/23/wizz-air-profits-to-glide-to-top-of-guidance-range/
€3.2m is the average profit per aircraft. Wow.
So who was the guy that was saying that they are just about to go bankrupt?
Deletedont remember anybody saying that about Wizz Air but Tarom a few days ago..
DeleteYesterday, some1 said that they (W6) are not paying their leases, sugesting they will go bankrupt in the near future.
DeleteI think W6 has the highest profit margins of all European airlines after FR. They are even ahead of U2!
DeleteSa toliko novih masina nema trika da imaju profit. Cak i sa sve sardinama od putnika unutar njih. Umetnost citanja finansijskih izvestaja. Da li vi zaista mislite da oni vrede milijardu i po dolara, a ne poseduju ni jedan avion? Samo investirajte u njih.
Delete@ AnonymousMarch 23, 2016 at 12:01 PM:
DeleteLCCs aquire aircraft through buying, followed by sell-and-leaseback. That's how they get low prices (massive order), while at the same time keeping the monthly expenses (leasing) quite low.
Also, new aircraft are considerably more reliable, require less downtime for maintenance (C check on new aircraft takes a week compared to a month on a 20-year old) and they can utilise them more. You can't plan 3 hours downtime per day on a 30-year old JU 733, but you can on a 6-months old W6 A320.
Why would you need to have OWNED aircraft to make profit? Unless you are LH, BA, or one of the oil-supported company from Middle East, it just doesn't make sense, unless the airframe is 30 years old, like JU 733, and price is in hundreds of thousands.
+1 @12:56
DeleteSomebody here's stuck in 20th century accounting.
Vidim kupili ste njihove akcije. Kada budete glasali svojim novcanikom mozemo dalje da pricamo inace mozet po mrezi da kupujete Enron, Lehman brothers i sl mocne kompanije do mile volje. Imali su slicnu ekipu ulagaca. Prazne ljusture ne mogu da donosu profit ni sigurnost ulagacima. Vi sigurno niste veliki finansijski muljaci.
DeleteWow, some1 instead of someone. Never saw that before.
DeleteAnonymous 1:28 PM
DeleteYou are completely and utterly ignorant of how airlines and the business world in general function!
Kako da ne poslednja dva velika sloma berze su se odigrala bas po tvojim pravilima, gologuzani su ocerupani. I zasto brises komentare o kafanama? Sta ti smeta sto nemas neku za razliku od mene i mnogih pilota JATa?
DeleteМешаш бабе и жабе пријатељу. Лизинг нема везе за финансиским сломовима. Држи се ти кафане.
DeleteLupetas vise sa lizingom naravno da ima kada su im svi avioni iz lizinga. I Air Serbia posedujue samo par krseva kojima istice vreme. Za AeroCap mozes da kazes koliko vrede za Wizz Air ne.
DeleteKakav primitivan nacin izrazavanja.
Delete@Anon at 12:56
DeleteWhat margin is leasing company making on Wizz sell and leaseback deal? Cost of borrowing is low and small margin on a large fleet can make you a lot of money.
There is a lot of talk about Air Berlin being in very, very difficult position financially and looking to selling its European network to Easyjet!
ReplyDeleteUnknown what will become of it longhaul routes/planes.
http://www.airliners.net/aviation-forums/general_aviation/read.main/6655339/
It continues to loose money while every other LCC in Europe as well as most full service carriers (FSC) continue to make record profits.
They are a lost cause. They are confused and all over the place. With Ryanair expanding all over Germany and Eurowings slowly starting to expand they will face more and more difficulties.
DeleteI do wonder if one thing they could do is launch BEG from DUS and TXL so that both cities have double daily flights. At least like that, through JU, they could capture some of the Germany-Balkans market.
It's very possible to see them again @ BEG as they're returning to SOF starting from tomorrow. The service between SOF and TXL will be double daily - 1 morning flight performed by FB and one in the evening performed by AB.
DeleteBut you see, if there was true solidarity among EY airlines this would have never happened. Their SOF flights will not only take away passengers from JU's JFK flights but also from some of their European ones. The Balkan peninsula should be covered by JU via BEG. This was a major slap in the face by AB.
Delete@ Nemjee,
Deletedon't forget that AB is struggling to survive.
Which is one more reason why they should introduce BEG flights. These would be full and the yields wouldn't be too bad.
DeleteUnlike Air Serbia, Air Berlin has a large and wealthy home market. If they can't make that work then it can only mean that their problems are huge and that they are bound to go belly up, sooner rather than later.
If the rumors of an easyJet takeover are true, it really makes you think what the future holds for them. I don't see easyJet keeping the AB brand.
@ Nemjee,
DeleteI don't buy this regardin easyJet. I don't see a single reason why they would buy a shitty and debted company like AB.
Me neither, I don't see what value AB would bring. It would be far wiser (and cheaper) to simply let the airline go bankrupt and then to rush in and fill the void left behind.
DeleteHowever, if AB does go belly up then it will be really bad for Etihad who will no longer have total freedom when taking over airlines. Governments will force them to give some guarantees so that they can avoid the same scenario as the one with AB.
JU would also be struggling to survive if it wasn't for massive subsidies through the government and BEG airport.
DeleteIf AB was getting similar subsidies from Germany EY would have no problem keeping it.
Here while not paying themselves anything for their 49% enjoy state subsidies from the owner of the 51%.
it is excellent for them.
EY group has made a mess of every European airline it has bought, thankfully for them because the Serbian government made the best deal (for the Arabs) JU will be the last airline that they will close down or sell.
@ Anon March 23, 2016 at 2:04 PM
DeleteIn some moment BEG and the government have to cut those subsidies. They can't go forever. Time will tell what will happen.
@ Nemjee,
Deletetotally agree!
Anon 14.04
DeleteMy opinion on this matter is that we should give them until the end of the year and then see how far they've come. If they still need subsidies to survive then it means that there is something seriously wrong and that a solution needs to be found.
However, if they manage to organize themselves and to actually pay their bills without the government stepping in then good for them.
It's like when you take a loan from a bank and you get a grace period. I see it in the same way.
Vise izvora prica o tome da bi moglo da se desi .
DeleteSvakako bi bilo zanimljivo videti sta bi U2 i EY napravili od AB.
INN-NS
@ Nemjee,
DeleteAgain - totally right!!!
I can not understand how EY after all those years still fails to find good managers and execute a proper business strategy for both Air Berlin and Alitalia.
DeleteAt a time that every other airline in Europe seems to be making profits and expanding those two very large airlines continue to fail.
The subsidies mentioned above is Serbia's 51% investment into JU. EY did their part by providing their 49%. If we saw into financial reports, we could see how JU is realistically doing without needing to wait an extra year.
DeleteAs for EY, its management is a mess. Massive crew dissatisfaction in the company, while many managers have left. From a passenger perspective they are a good airline, as is JU, but looking into both the biggest problems is internally.
As for AB, I don't see it holding on much longer.
Nemjee, couldn't agree more regarding the EY partners and solidarity. Makes me wonder if any of the 'partners' will codeshare on the new JU flights. Interesting fact is that it is not possible to book AUH-JFK via BEG regardless of that all flights connect.
How much money has EY put into JU the last 2-3 years.
DeleteWe know that the Government and the airport put a lot through subsidies and other concessions for their part but how much did EY put for its 49% share?
Is it actually putting any real money or just offering "advise" and strategy direction?
Also why cant Alitalia and AB codeshare on JU flights to the Balkans, Ukraine, Turkey, Israel, Cyprus?
Why start their own flights or increase frequencies when they have a partner already flying there?
A point that I think is very important: JU costs must be much lower than AB and AZ since it is based in Serbia where salaries and other costs are far cheaper than Italy and Germany so why not take advantage of that and drive traffic through BEG?
It would be much more competitive as an alliance than transferring people through Rome or Berlin.
Thank you for every info you might have.
I don't understand why people continue with the misinformation around the EY investment into JU. The agreements were all revealed over 12mths ago and it is clear for everyone to see what the agreement obliges each shareholder to do, especially when the airline was recapitalised.
DeleteIn short, the govt committed to take over the debt of Jat Airways and then each shareholder was to put in $40M each. Etihad paid in its $40m while the govt - with the agreement of EY, didn't have $40m and decided to do so through airport waivers over a 3 year period.
These ended in Oct 2015 and JU has been paying its airport fees IN FULL since Nov 2015.
End of story and all very easy to verify. A simple call to BEG airport will confirm this.
So let's just all move on from these urban myths and discuss other issues which are far more relevant and interesting than in recycling the same old lies time and again
Anon @ 5.20pm - AZ and AB are already codesharing on JU's flights to and from BEG. From where did you get the information that they aren't ?
DeleteJATBEGMEL
DeleteAh I didn't know they were leaving Etihad. Do you know why? What's driving them away? Will be interesting to see what the future holds for Etihad as both Qatar, Turkish and Emirates keep on expanding and growing.
@ nemjee
DeleteEY has been short of crew for the past couple of years despite the amount they recruit. Actually there are groups of JU crew temporarily transferred to EY. Crew feel overworked.
QR is known for its poor reputation of its treatment towards its staff.
EK has similar problems as EY, a lot of dissatisfaction with crew which has forced upon some changes, especially when it started to become public with a blog (which became banned for viewing in the UAE btw) as well as a couple Wall Street Journal articles whilst EK was protecting its reputation against allegations thrown to the ME3 by the US3. Recently a number of pilots have gone over to EY citing better conditions, however EK seems to be taking on pilots from MH. EK seem to be attempting to improve some things, however it seems to be very slow.
Since the FZ crash, there has been some whistle blowers not only from FZ but others stating how complaints of fatigue is ignored. The problem is that the head of these airlines also run the respective aviation authorities, so everything is legal for their respective countries. This was published yesterday by RT, which even included a crew roster from FZ. Also there was allegations of operations pushing to land the plane in Rostov whilst SU and OK diverted to Krasnodar that night. Nothing is confirmed, however if these allegations are true it will be quite damaging.
As for TK, they have solid operations and have built up a brand. However, the instability in Turkey doesn't look promising, nor the fact that they've written off 3 new aircraft in recent times. IST is really limiting their operations too. With Iranian sanctions lifted and the massive orders starting to come from Iranian carriers, it will be interesting how things unfold.
Its a turbulent region affecting all airlines. There is no financial reports from EY or QR showing how theyre performing. TK and EK are doing quite strong whilst QR seems to be replicating EK. EY is the weakest facing a lot of challenges (airport capacity and infrastructure, shortage of staff, shortage of aircraft etc) whilst at the same time buying into loss producing airlines. Next couple of years will be very interesting.
JATBEGMEL .... codeshare is not a fait accompli between airline partners... it is tied to bilateral agreements and in this case, it is something called 3rd country codeshare. Etihad cannot codeshare on JU's flights to the USA because the bilateral between the UAE and the USA restricts it.
DeleteAZ cannot codeshare on JU's JFK service because it is in a JV with DL, AF and KL across the Atlantic and it is prevented from doing so due to this. JU also cannot codeshare on AZ across the Atlantic, for the same reasons.
AB on the other hand, is not restricted by oneworld, nor is it restricted by the bilateral between the EU and the USA and will codeshare on its service, once JU has cleared the FAA process regarding its Ops Spec plan.
Not all is as it seems - no need for the conspiracy theories that abound.
Just relax, all is in hand...
Relax? All is in hand? Really? Isn't that what they kept on saying at AB? ;)
Delete+1
DeleteI remember every new CEO that came to AB or AZ or any other failing airline pretended as if they are in control and knew what they were doing. End result, well... we all know
But here you must know that:
Delete1. BEG (for GoS) "invest" in Air Serbia more than 40 million EUR in 3 years(last year it was 22 million instead of 14).
2. In same time Republic of Serbia give subsidies of 14-18 million per year, Etihad does not have same obligation.
3. Etihad "investment" is loan which by the contract they can ask to take it back in any reason they find important without explanation and without any consequences for Etihad! That is just the way of blackmail and not investment.
4. Air Serbia is paying Etihad, Alitalia and Air Berlin for education, training, leasing, maintenance... even they pay for top senior managers to Etihad who decide how much is "fair price" and it was not defined by contract how much is that "fair".
@Anon at 9:20
DeleteJV does not cover south Atlantic. JU can go ahead and create CS with AZ to EZE and GRU.
@Anon at 6:28
Delete"I don't understand why people continue with the misinformation around the EY investment into JU."
Mate, interest that keeps driving this misinformation can be categorized as: airline competitors, political opponents to PM, bitter ex employees, jealous neighbours etc...
anon @ 4.27am - yes JU can codeshare on AZ to Sth America. BUT, the current bilaterals between Serbia and these countries needs to be renegotiated to allow 3rd country codeshare.
DeleteAnon 4:37
DeleteOr maybe they are just real!!!!!
Or maybe they are just real haters!!!
DeleteCan somebody comment and clear up the things about today's Air Serbia ATR72 YU-ALO flight from Podgorica to Belgrade over BiH?
ReplyDeleteThere are rumors that Etihad are planning TAROM acquisition. It will be very interesting if this happens.
ReplyDeleteI'm still waiting for them to buy Air Malta like it was announced in their press several months ago. Etihad and Turkish seem to be the go to carriers for the media whenever an airline is being sold.
DeleteProbably the Romanians approached Etihad and then the rumors started. Highly doubt they would be too interested given the amount of problems they have with the three/four airlines tehy have in Europe.
Delete@ Nemjee,
Deletedon't forget the Romanian market. Romania + Moldova are around 30 mln. It's not a market that you can underestimate so easy...
I absolutely agree with you but at the same time don't forget that the market is highly decentralized which makes it very difficult to serve from a single airport. Not to mention that most traffic from/to Romania heads west, and OTP being in the south-east is at a disadvantage.
DeleteBEG can cover these markets far more efficiently. Even FCO can link Romania with southern France, Italy, northern Africa and the Iberian Peninsula.
@ Nemjee,
DeleteI highly doubt that BEG will be competitive on these markets taking in considaration the LCC carriers in Romania and the huge number of weekly departures to Italy and Spain. From OTP - Rome have 46 weekly departures, Milan - 44, Madid 27, Barcelona - 23.
I was merely speaking from a geographical point of view when comparing BEG and OTP. Flying via Belgrade would require less backtracking from certain parts of Romania. That's why I said that Romania is decentralized and most of its non-OTP markets are well connected with direct flights.
DeleteIf JU was to expand in Romania, I am sure they could fill at least a daily Atr with passengers heading to AMS, BRU, CDG, Scandinavia, Vienna, Moscow and so on. Even two stop options to Asia and Australia could work.
@ Nemjee,
DeleteTo be honest - I admire what in Romania are doing. They have a great aviotion sector currently (very competitive) and it's constantly expanding in the last 3-4 years.
I think it was fueled by a relatively bad road and rail infrastructure. Things are slowly changing but a lot of people got used to flying... and with Ryanair in the game now it will be even easier!
Delete@ Nemjee,
DeleteI've been driving in Romania and can tell you that there roads aren't that bad as people think :)
I've only flown into Romania so I can't speak but from what I've seen the whole country isn't connected by highways, especially as you move to the north. :)
DeleteI drive in Romania several times per year and you can make 200 km in 4-5 hours. Roads are disaster!!!! Even in Bosnia roads are better.
DeleteThere are very strong roumours that the hungarian government wants to establish a new national carrier with 6 aircraft for the beginning. Since direct subsidies are not allowed this is could be a very elegant way to handle it....ring a bell?
ReplyDeletethis will be very stupid.
DeleteCould be, but I doubt ex-Yu + Albania would be a priority for them in terms of new routes, although maybe a good starting point since they would have a whole lot of competition on other routes.
DeleteLook up 'Solyom' and what happened to it.
DeleteNo way Jose. It was not rumor but a desperate try from the russians to sell their sh#t to someone (in a joint venture if needed as no airlines want it for money).
DeleteWhat happened with Esthonian being taken over by a Russian investor and introducing Supejets instead of the CSeries?
DeleteSubsidies? Didn't I read here time and time again that subsidies are bad, bad, bad? Nice "free market"!
ReplyDeleteNo, it is not real true. Most of people here did not say so.
DeleteSubsidies are OK if you finance route and make tender on which all carriers have same possibility to fly on that route. Than, by same conditions you choose one or more airlines to fly on route.
Subsidies are not right if you finance one company without tender, with no conditions and without chance that competition fight on same tender for same route. That is principal of EU.
tako je znaci odabrana Adria da zauzme monopolsko mesto u Estoniji ?
DeleteSubsidies are OK, if the government/local community says "We want somebody to fly this route, we are offering this amount of money, please send your offers and the best one will get the subisidies".
DeleteBut putting millions into national carrier (Adria), who uses (among other things) money to fly TIA-FRA, LCJ-MUC, TLL-BRU, which doesn't have any benefit to citizens of subsidising country - that's not OK.
Picking a single company without tender (i.e. all exyu airlines, which are state-owned) to which you sink millions, just because it was done like this for the past 50 years. That is not OK.
But still:
Delete1. Paying someone to do unprofitable flight is not capitalism or free market.
2. Fairness could be defined differently. From a point of view of a society or a state it might be more fair to subsidize state-owned company, like Turkish Airlines and then collect a part of the profit at some point.
Subsidies are strongly defined by EU rules. You can not give them just like that. And never, but never you can make advantige on one or several companies in comparation of others on same route or route which are compatible (for example you can nos subsidize route to MUC, but in same time there is carrier to fly on FRA). Those routes must be of PSO (public service obligation) like connection to islands or rural part of country, or must have some huge impact of community.
DeleteBut for sure one can not finance route where you have several airlines and just one of those will be financed, and others would be discriminate. It is more than forbidden. Those routes must be unreserved and that there is no interest between airlines to fly on them as they can not make profit, so they must be subsidized to attract one company to fly there.
"2. Fairness could be defined differently. From a point of view of a society or a state it might be more fair to subsidize state-owned company, like Turkish Airlines and then collect a part of the profit at some point."
DeleteUnless mentality in company becomes "we don't care, the government will give us money when we need it" and then there is no profit to show. Any similarity with Adria is purily coincidental.
OT: JP is not waiting for BRU to reopen, and has instead rerouted it's planes to Liege. Both of it's morning and evening flights tomorrow JP376/JP394 will land in Liege instead of BRU. BRAVO for the pro-activity. Other airlines, including SN will be using (capacity permitting) either Liege or Antwerp airports.
ReplyDeleteJU on the other hand has cancelled it's flights to Belgium and issuing statements on their cancellation every day.
Btw, Alitalia, an Etihad Partners airline, has also scheduled flights from FCO and LIN to Liege airport.
DeleteIt's interesting to see how other airlines are handling the situation. OS has cancelled it's flights to BRU as well, but have clearly indicated that it's done until March 28, preventing pax from wondering if next day's flights would operate:
Delete" Brussels
All Austrian Airlines flights to and from Brussels scheduled until Easter Monday 28 March 2016, have been cancelled."
SN will operate 64 flights on Thursday (44 from Liege, and 20 from Antwerp) and 96 on Friday (66/30) vs. 235 flights it would normally operate.
DeleteIt has furthermore sent 5 empty long haul planes to destinations in Africa to pick-up pax and bring them to locations in Europe (e.g. Zurich).
Source: http://www.lalibre.be/economie/actualite/attentats-de-bruxelles-brussels-airlines-relocalise-56f2eebe35702a22d5a98d4c
"moderate rebels" at work can actually make a big mess. I am pretty sure US and friends were not expecting this
Delete