None of the five airlines leaving the Riga airport

märts 11th, 2009 postitaja on Ilona
Lisa oma kommentaar

RIGA, Mar 09, BNS

None of the five airlines leaving the Riga airport in fall plan to return next season, said Latvian daily Diena on Monday, citing the airport’s vice-president Janis Balkens.
According to the daily, the only new airline attracted by the airport for the summer season is the fourth largest Italian airline Windjet, who will fly once a month to northern Italian city Forli from June 10.
“Everybody we are addressing says — look what is happening with your domestic market,” said Balkens.
The number of domestic passengers at Riga airport declined by 26 percent in the first two months of this year, and the growth in passenger numbers in airport in general was achieved on the account of transit passengers.
In 2008/09 winter season Germanwings, Austrian Airlines, Aer Lingus, EasyJet and troubled Lithuanian Flylal left the Riga airport.
In the winter season flights from Riga airport are still provided by Airbaltic, SmartLynx, Lufthansa, Finnair, Ryanair, KLM, LOT, Czech Airlines, Norwegian Air Shuttle, Turkish Airlines, Aeroflot, and Uzbekistan Airways.
———————-

East Europe’s airlines face shakeout amid crisis * Central, east europe airlines struggle to survive on own * Competition from large airlines, low-cost operators

BUDAPEST, March 10 (Reuters) – National airlines in central and eastern Europe face pressure to give up their independence or go bust as the global economic crisis hits demand and competition intensifies.

“We cannot have one airline per country,” said John Strickland, an analyst at SNL Consulting in London. “If an airline isn’t strong, it’s difficult to keep it going …certainly there is no guarantee.”

Competition is coming from large network airlines such as Germany’s Lufthansa, which feed their transcontinental routes, and low-cost operators flying point-to-point which established a strong foothold in the region.

Among the worst off regional player is Hungarian national carrier Malev, which has posted deep losses for years and expects to be taken over by a Russian bank which financed its privatisation in 2007.

Its regional peers, most still majority state-owned, are not much better off as passenger traffic declines. In January 2009 European traffic was down 6 percent from a year before, according to the International Air Transport Association.

The effects of that decline vary around eastern Europe, but few of the already-struggling national carriers are expected to survive on their own in the long run.

Poland’s national carrier LOT for instance has been hurt by high fuel prices and saw revenue and passenger numbers drop late last year. It has repeatedly put off plans to float its shares or privatise and sacked its fifth CEO in five years last week.

“Every medium sized airline, such as LOT, would have to tackle a serious crisis sooner or later,” LOT’s ousted boss Dariusz Nowak wrote in an open letter before his dismissal.

NEW INVESTORS

Czech flag carrier CSA was put up for sale in February after its second profitable year. Air France-KLM has expressed interest, as has Russia’s Aeroflot.

Loss-making Malev expects to find new investors and a fresh infusion of capital within weeks, interim CEO Geza Fehervary told Reuters. Both should come from state-owned Russian bank Vnesheconombank (VEB), he said.

VEB is expected to take formal control of a 49 percent stake in Malev, and as an owner could extend loans as the airline reshuffles its operations. Fehervary says Malev expects losses to narrow after layoffs and restructuring last year.

Serbia’s state-owned airline JAT Airways will cut about half its workforce this year to cope with the economic downturn, its general manager told state news agency Tanjug last week.

Going it alone is tough for low-cost carriers as well. To their advantage, no-frills operators are not exposed to cargo, premium passengers or long-haul holidays, which have taken a hit in the crisis, said Geoff van Klaveren, airline analyst with Exane BNP Paribas.

“But the bottom line is, short-haul travel is a commodity product,” he added. “Lowest cost will win.”

Slovakia-based Sky Europe has been unable to boost traffic of late, has never broken even, and its shares have gone from above 5 euros to less than 20 cents in the last two years.

CentralWings, LOT’s no-frills daughter, was folded back into the parent company as a charter operator last year.

Budapest-based regional low cost Wizz Air has taken some of that market space. It has grown to fly nearly 6 million passengers in 2008, making it the second-largest airline in the region after Austrian. The company is privately held and is tight-lipped about its financial performance but Wizz Air CEO Jozsef Varadi told Reuters it was doing fine and needed no outside capital.

“We generate enough cash flow to support our operations,”Varadi said, adding the company expects to boost passenger numbers by 35 percent in 2009. “We can grow even in a recession,” Varadi said. “The main factor now is ticket price. Everything else is secondary.”

————————–

Latvia’s Airbaltic carrier to close domestic routes to Liepaja, Ventspils if govt subsidies are cut

RIGA, Mar 10, BNS – Latvia’s Airbaltic national carrier will close its passenger routes to the western Latvian port cities of Liepaja and Ventspils if it does not receive government subsidies this year, the airline’s representative told BNS.

Airbaltic vice-president for corporate communications Janis Vanags said the domestic flights were unprofitable and that the airline needed government support to continue them. “It happens automatically — if the subsidy is not allocated we do not fly,” he said.

Latvia’s Diena daily reported on Tuesday that the new coalition has agreed to scrap the 2.5 million lats (EUR| 3.5 mln) allocation in Latvia’s 2009 budget needed for Airbaltic’s unprofitable flights to Liepaja and Ventspils.

Airbaltic launched summer season flights from Riga to Liepaja and Ventspils in 2005, and in 2007 it opened routes from Liepaja to Copenhagen and Hamburg. The airline only served the Riga-Ventspils route for one season, from April 2008 to September 2008. In 2008, the government allocated 2.59 million lats for domestic flights from Liepaja and Ventspils airports. To cover the costs of domestic flights from Liepaja, the port city’s local authority received 1.49 million lats, while the Ventspils City Council received 1.1 million lats.

Jaga teistega |