Solution for Jat within two months

Status quo to be upheld at Jat until 2012

UPDATED

The tender call to find an interested partner to create a successor national carrier to Jat Airways ended today. The tender began on August 1 and was extended on September 30 for another month. Not a single company purchased the tender documentation. The Minister for Infrastructure, Milutin Mrkonjić, said yesterday that a solution for Jat’s problems will be found by the end of 2011 and that 1.300 of the airline’s employees shouldn’t worry about their livelihoods. According to the minister, two large companies are interested in taking over Jat Airways, one of which is airBaltic from Latvia which bought the tender documentation. Over the past two months, it has also been rumoured that AZAL Airlines from Azerbaijan considered participating in the tender. However, the Azeris might be interested only through direct negotiations with the government.

As a result, the current situation in Jat, or the status quo, will be upheld until the end of the year. The entire tender procedure cost the government millions while the consultant company used in the process (said to have close ties with the government) was also paid a hefty sum. It is not the first time that a consultant company has been paid to advise Jat on its future.

The Minister for Infrastructure did not reveal the names of those companies interested in taking over the Serbian state carrier (with the exception of airBaltic), saying instead that by the end of the year it will be revealed where Jat is “heading towards”. He added that talks between the government and potential investors will be “flexible”. Last week at an economic summit, Mrkonjić pleaded for airlines from Azerbaijan, Russia and Turkey to participate in the tender. airBaltic, the only airline to answer the tender call filed for bankruptcy last month.

Zagreb surpasses two million

Croatian airports record growth in September

Last week Zagreb surpassed the two million passengers mark, an impressive 48 days ahead of last year. The passenger was travelling from Zagreb to Istanbul on a Turkish Airlines flight. In September, Zagreb saw 240.805 passengers, an increase of 12.6% compared to last year.

Elsewhere in Croatia, Dubrovnik and Split both recorded a passenger increase compared to September 2010. The two have handled a total of 2.307.811 passengers this year and during November managed to surpass the end of year result from last year. Pula also recorded a passenger increase with the airport seeing almost 8% more passengers this year compared to last. With 886 passengers at Mali Lošinj this September, the airport grew 82.3%.

On the other hand, Zadar is continuing to record a passenger slump. Numbers fell by 3.5%, although so far this year the airport has seen growth of some 3%. Osijek handled 2.475 passengers, which is down on last September. Osijek Airport won’t see any scheduled flights until the end of the year, meaning its figures will significantly decline from now until March 2012.

Below you can review the performance of Croatia’s airports in September 2011. OveSeptember 2010. The statistics have been provided by the Croatian Bureau of Statistics.

Airport	Passengers SEP 2011	Passengers SEP 2010	Change (%)
Zagreb	240.805	213.876	▲ 12.6
Dubrovnik	203.360	187.630	▲ 8.4
Pula	55.763	52.770	▲ 5.7
Split	182.459	171.066	▲ 6.7
Zadar	36.928	38.266	▼ 3.5
Osijek	2.475	2.821	▼ 12.8
Rijeka	13.557	9.870	▲ 37.4
Mali Lošinj	886	486	▲ 82.3

Winter season 2011/2012B&H, Croatia and Montenegro Airlines

Winter changes

The 2011/2012 winter season begins tomorrow.

As has been previously reported, B&H Airlines will suspend flights to Amsterdam this winter. Compared to the 2010/2011 winter season the airline has terminated a total of six destinations. Since flights to Copenhagen will now operate via Banja Luka and all four weekly frequencies from Sarajevo to Zurich will also make a stop in Banja Luka, the second largest city in Bosnia and Herzegovina will see six weekly flights operated by B&H, which is an increase of one compared to last winter. The frequency for the airline’s Zurich service has decreased by one flight since last winter and will be served four times per week. Flights to Istanbul remain unchanged.

Croatia Airlines won’t be making too many changes to its winter line up of destinations and frequencies compared to last year. Flights from Zagreb to Istanbul, which were launched over the summer, will remain throughout the winter period while Priština will also see an extra weekly flight. Facing competition from easyJet, Croatia Airlines will decrease its Paris flights from daily last year to five per week. On the other hand, it will continue to operate to the French capital from Dubrovnik two times per week, which is a new addition. As has been the case in the past few years, the airline won’t operate flights from Rijeka and Osijek during the winter.

Montenegro Airlines will see frequency cuts across the board over the winter period. However, it should be noted that last winter the airline practically operated its 2010 summer season timetable. Flights from Podgorica to Belgrade, Frankfurt, Moscow, Rome and Zurich will all be decreased while flights to London suspended. However, the airline will continue to operate flights from Tivat to Moscow which were launched during the 2011 summer season.

By clicking on the links below, you can view the 2011/2012 winter season changes in more detail.

B&H Airlines • Croatia Airlines • Montenegro Airlines

Zagreb Airport issues strike threat

Unions want CEO to go

UPDATED

Employees at Zagreb Airport are threatening to go on strike since the airport’s CEO, Tonči Peović, wasn’t sacked by the government today. The airport’s unions are unhappy with the CEOs performance blaming him for diminishing profits, the possibility of foreign ownership over the airport and no revisions to their collective agreements. Božidar Kalmeta, the Minister for Sea, Transport and Infrastructure held a meeting today where Peović’s management practices were discussed. It was concluded that Zagreb has been managed well in the past few years and is reporting a profit.

After successfully managing Dubrovnik Airport for sixteen years, Peović was named as CEO of the country’s busiest airport in 2009. He announced that he would cut the cost of airport handling services in a bid to attract more low cost airlines, adding that negotiations were underway with easyJet and Ryanair. The no frills easyJet commenced flights to Zagreb and now serves the Croatian capital from Dortmund, London and Paris. However, Peović is also associated with several scandals. He was said to be in a conflict of interest while serving as both the CEO of Zagreb Airport and a small airline in Dubrovnik. Furthermore, unions accuse him of having an extremely high salary and in a recent cable revealed by Wikileaks, Peović is said to have complained about Minister Kalmeta and had no nice words to say about Croatia Airlines to the Ambassador of the United States.

Zagreb Airport recorded impressive growth this year and this week handled its 2 millionth passengers of the year. The airport’s management says Zagreb will see a 10% increase in passenger numbers in 2012.

Montenegro passenger slump

Montenegro Airlines cancels London flights and sees passenger decrease

The CEO of Montenegro Airlines, Zoran Djurišić, has announced that the carrier will handle some 600.000 passengers this year, declaring the result a major success in the region in spite of the turbulent economic climate. However, Montenegro Airlines’ passenger numbers are on the slide. The airline carried 630.000 passengers in 2010, thus recording an almost 5% slump this year. “We are not magicians and we can’t escape the fate of bigger European airlines. However, we have devoted all of our efforts so the crisis does not impact on our business”, Djurišić said. He added that the airline has carried some 5 million passengers in its seventeen year history and has significantly contributed to Montenegro’s tourism industry. Below you can review Montenegro Airlines’ end of year passenger results for the past several years.

Meanwhile, Montenegro Airlines will suspend flights to London Gatwick this winter due to poor loads. The airline announced its plans to drop the route earlier this year as part of its cost cutting measures. The last service will operate tomorrow. So far this year the airline has also terminated flights to Priština and Skopje.

The Government of Montenegro has announced that it plans to sell a 30% stake in the airline by the end of the year. Some claim that a direct deal with the Turkish government will be made regarding a strategic partnership with the Montenegrin carrier.

Year	PAX
2008	502.758
2009	527.000
2010	630.000

B&H drops Amsterdam

B&H dumps Amsterdam and temporarily suspends Copenhagen

B&H Airlines will suspend flights to Amsterdam at the start of the 2011 winter season, the Dutch “Scramble Magazine” reports, leaving the airline with a total of three destinations. B&H recently removed Amsterdam from its webpage booking option and the service has disappeared from global ticketing systems. In recent weeks, flights from Sarajevo to Amsterdam were operated by an ATR72, adding additional flight time to the service. The final flight from Sarajevo to Amsterdam is scheduled to operate on October 27, just under a year since it was launched.

From October 30, B&H will also temporarily suspend flights to Copenhagen but those are set to resume on December 1 with the service rerouted via Banja Luka. Flights to Zurich will remain during the winter, however, all of the four weekly services will operate via Bosnia and Herzegovina’s second largest city - Banja Luka. The only service which remains unchanged over the winter season is Istanbul. Turkish Airlines, which will be decreasing its frequencies to Sarajevo, will introduce its brand new Boeing 737-900 on the route from December 8, thus increasing capacity. So far this year B&H has suspended flights to Vienna, Frankfurt, Stockholm, Gothenburg and Belgrade.

If any changes to B&H’s current winter operations occur they will be reported on Saturday along with all the changes being made by Croatia Airlines and Montenegro Airlines over the winter season, which begins this Sunday.

Dubrovnik Airline grounded

Dubrovnik Airline 2004 - 2011

Local newspaper “Dubrovački vjesnik” has reported that the charter company Dubrovnik Airline has been permanently grounded and put out of business. The debt stricken airline operated its final service on Sunday and is expected to declare bankruptcy soon. However, it is important to note the airline’s Managing Director, Zeno Singer, is still to officially confirm the news. Dubrovnik Airline has had major financial problems since the start of the global financial crisis which hit the aviation industry in the former Yugoslavia in 2009. Dubrovnik Airline was left with a single aircraft this year during the peak summer season. Adding to Dubrovnik Airline’s financial problems was the decision made earlier this year by the shipping company Atlantska plovidba, who set up the airline, to pull out of its ownership structure. After the decision was made, many employees at Dubrovnik Airline lost their jobs bringing the number of down to just 78.

Dubrovnik Airline was launched in December 2004. Over the years it has contributed greatly to its main hub Dubrovnik as well as Split. During its highpoint the airline operated a fleet of five aircraft and employed some 200 people. In the last year it announced several times its plans to expand and even introduced regular all year round flights.

In a poll conducted by EX-YU aviation news earlier this year, asking visitors which smaller former Yugoslav airline had the biggest potential to grow, the most votes (215 out 623 or 34%) went to Dubrovnik Airline.

Final call for Azerbaijan

Waiting for a partner

The Serbian Ministry of Infrastructure has issued a final call for Azerbaijan to participate in the creation of a new national carrier to replace Jat or to form a strategic partnership with the Serbian airline. The Ministry emphasised that the extended tender call to create a new carrier ends in a week’s time. The tender is widely expected to fail since no one has even purchased the tender documentation, although the Serbian government maintains it extended the original tender deadline by a month due to interest shown by several airlines.

Azerbaijan, which said it would consider taking over Jat in return for some other investments in the energy industry, currently seems to be the only interested party. However, the Azeris are more interested in taking over Jat in its current form rather than creating a successor airline by mid 2012 as the tender outlines, local media report. In turn, the terms set out by the tender seem to have vanished and direct negotiations between the two sides could take place if only Azerbaijan was actually interested. “We kindly ask that our good friends from Azerbaijan express whether they are interested in entering a strategic partnership with Jat. We would be more than happy for you to incorporate Jat into your operations”, Milutin Mrkonjić, the country’s Minister for Infrastructure said last week at the Black Sea Economic Cooperation summit in Moscow.

Despite officials from Azerbaijan holding talks with the airline’s management and surging ties between the two countries, there is little Jat can offer to the oil rich state. Over the past four years media have reported that Aeroflot, Turkish Airlines, Air India, Icelandair and airBaltic have all been interested in a partnership with the Serbian carrier at some point or another. None of them materialised.

It is unknown what the governments’ plans are for Jat if the tender fails. In such case, it has been established that the government won’t be making a successor national carrier. The government has the option to depoliticise the airline’s management, of whose incompetence you could have read last week. It also has the option of injecting state aid into the airline as has been the case with Adria Airways, Croatia Airlines and Montenegro Airlines this year. Finally, a likely scenario is for the government to keep the current status quo at the airline until after the parliamentary elections, expected in May next year. Last week, Mrkonjić stressed that the government would never allow for Serbia to be left without a national airline.

Further delays for Zagreb’s new terminal

Terminal construction delayed and costs slashed

Although the construction of Zagreb’s new terminal has been delayed for the past decade, just as things started moving forward, the Croatian government has announced a fresh delay to the start of construction and is cutting down on the grandiose project. The tender to choose who will partially finance and run Zagreb’s long awaited new terminal began back in April. The winning bid from the six companies left in the race was supposed to be announced during early November. The government has now publicised that it will select the winning bid in March 2012, effectively pushing back the start of construction. Furthermore, the state is also cutting down on the terminal’s capacity from the planned 5 million passengers per year to 3.5 million. As a result, the price tag of the new terminal has been slashed from 198 million Euros to 190 million. The government claims that this was done upon the request of the bidders.

Construction is now unlikely to start before September next year. However, the Government of Croatia maintains that the first phase of the new terminal should open sometime in 2015. Vying to build the new terminal are Houston Airport, Athens Airport and Seoul Airport to name a few.

The current terminal at Zagreb’s Pleso Airport is already getting crowded. So far this year Zagreb is recording growth of over 13%. By the end of September the airport handled 1.808.810 passengers. By the end of the year the figure should reach 2.3 million with airports across the country expected to record historic passenger growth in 2012. The current terminal has the capacity to handle approximately 2.5 million passengers per year according to official sources.

Winter season 2011/2012Adria and Jat Airways

Winter changes

The 2011/2012 winter season begins on October 30, 2011 and will last until March 24, 2012.

As has been previously reported, Adria Airways will suspend services to London, Paris, Stockholm and Warsaw from Ljubljana, flights to Dusseldorf from Priština and the Vienna - Frankfurt service. Despite earlier announcements that it would suspend its service to Toulon, the airline just recently decided to keep the flights throughout the winter. Compared to the 2010/2011 winter season, the airline will cut frequencies to Amsterdam, Copenhagen, Istanbul and Zurich from Ljubljana as well as Frankfurt from Priština. Flights to Belgrade, Skopje and Moscow will see a frequency increase, with Belgrade up by two flights on last winter, Skopje up by four and Moscow up by one.

Jat Airways will suspend its long running service to Dubai despite significant passenger numbers on the route over the summer season as well as last winter. Since most passengers on the Dubai flights continue to Australia with Emirates, the airline receives additional compensation from the Dubai based carrier for selling its tickets, which in turn covered the flights' operational costs, making the suspension questionable. Flights to Rome, Larnaca and Tivat will see their frequencies reduced with Jat operating only a one daily service to Tivat, down from two daily last winter season. The airline will resume flights to Paphos in Cyprus from November until the end of February with the service from Belgrade operating via Tel Aviv and the return flight operating nonstop. Athens will see a frequency increase. Flights to the Greek capital will be boosted with three additional services although the airline will reduce capacity by operating the ATR72 instead of the Boeing 737-300.

By clicking on the links below, you can view the 2011/2012 winter season changes in more detail. Next Saturday the winter changes for B&H Airlines, Croatia Airlines and Montenegro Airlines will be published.

Adria Airways • Jat Airways

Golden Air grounded

A new record - one week in operation

The newly established Golden Air which commenced flights from Maribor to London Stansted via Vienna last week has cancelled all services after the airline was grounded on Wednesday. Golden Air is experiencing problems with Eastern Airways from which it has leased a Cessna to operate the flights. “The Friday flight has been cancelled and passengers have been offered alternative transportation”, Urban Simčič, the airline’s representative told Slovenian media. However, the company’s owner says that he is not throwing in the towel and that a lot has been invested into the airline venture. “The Slovenian public has responded well to the new flights and we see enormous potential in them”, officials from the airline stress.

Golden Air highlights that the Maribor - Vienna - London service has only been temporarily suspended and is certain that flights will resume soon. The airline says it has lined up a Boeing 737-300 for future flights. The aircraft is now undergoing necessary licensing checks and once it is cleared the airline should restore the scheduled flights. The new services are seen as an opportunity for Maribor Edvard Rusjan Airport to revive itself.

Golden Air is partially owned by English businessman Harjinder Singh Sidhu who has previously invested into the now bankrupt Air Slovakia. AvioFun, a Slovenian company, has also invested heavily into the Golden Air project.

Low cost to Rome

Soon in Skopje

In just under two weeks, Skopje will once again see a direct air service from Rome Fiumicino Airport. The low cost Italian airline Blu-express will operate the service twice per week from Sunday, October 30. Currently, a return ticket in November will set passengers back 80 Euros, all taxes included. Blu-express is the low cost and short haul subsidiary of Blue Panorama Airlines which operates flights from Italy to holiday destinations such as Havana, Cancun and Montego Bay. The new service from Rome to Skopje will operate with a Boeing 737-300. Flight details can be found here.

Since MAT Airways grounded its single aircraft more than a month ago due to poor ticket sales, Skopje Airport hasn’t had scheduled flights to the Italian capital. The Macedonian Civil Aviation Agency has in the past two months been in pursuit of airlines interested to commence flights from Zurich, Rome, Dusseldorf and Amsterdam to the Macedonian capital in order to fill in the void left by MAT. The airline is unlikely to see its operating license extended for the 2012 summer season.

Meanwhile, Macedonian plane spotters had a sight for sore eyes on Monday when a VIP Qatar Airways Airbus A340-500 jetted into Skopje carrying the Emir of Qatar along with another Airbus A320 for the Emir’s entourage. Both countries signed a bilateral agreement for the development of tourism. Last year, Qatar and Macedonia signed an Open Sky Agreement granting airlines from both countries the ability to operate an unlimited number of passenger and cargo flights using any type of aircraft. The two countries also agreed to adopt an open skies policy in order to include third, fourth and fifth freedom passenger rights on intermediate routes and beyond.

Jat’s CEO nightmare

The loosing ways of Jat’s CEOs

Jat Airways has in the past ten years suffered from significant political interference and bad management which has seen it change six CEOs since 2001, all of which have been members of the ruling political parties. Recently, EX-YU aviation news has been inundated with e-mails from Jat’s employees writing about the astounding practices of their current management. The same case was observed last year, before the then CEO was sacked by the government due to mounting public pressure. EX-YU aviation takes a look back at CEOs past and present and asks whether this sort of unprofessionalism has bought the airline to its knees.

Vladimir Ognjenović, in office 2010 - present

As the nephew of one of the creator’s of Serbia’s largest governing party, Vladimir Ognjenović seemed like a natural choice for CEO of one of Serbia’s largest national companies. During his reign, Ognjenović has managed to increase the company’s losses and has recently ordered the suspension of several key routes. Among them are Stuttgart, Tel Aviv and Dubai, the latter which has bought the airline thousands of passengers and income thanks to a lucrative deal with Emirates. However, even before low cost airline Flydubai announced its service launch to the Serbian capital, Ognjenović ordered its cancellation for the upcoming winter season. In the end, he backed away from suspending flights to Tel Aviv and Stuttgart but is firm on discontinuing services to Dubai. It should be noted that Ognjenović was the vice CEO during the reign of Srdjan Radovanović (read below) and Commercial Director during Saša Vlaisavljević, both of which were declared incompetent by the government. Vladimir Ognjenović went as far as issuing a public letter of support for Srdjan Radovanović who he replaced.

Srdjan Radovanović, in office 2009 - 2010

Going down as one of Jat’s worst CEOs, being a member of Serbia’s largest governing party, Radovanović employed for his Financial Director an individual without a university degree and employed many others in marketing instead of cutting down on employee numbers. Having never worked at Jat (or any other airline), Radovanović, a lawyer by profession, lacked the basics of running a carrier, choosing instead to focus on free taxi services and travel insurance for passengers. Radovanović also planned for Jat tickets to be sold at post offices across the country. During his reign Jat’s technical and catering divisions went on strike, the former paralysing the airline for a week and the latter saw passengers receive only water on flights for three months. He also transferred powers from the Executive Board to the CEO allowing him, and those that preceded him, to determine route suspensions and launches and other operational decisions without consultating other relevant departments. Radovanović is now the advisor to Vladimir Ognjenović.

Saša Vlaisavljević, in office 2007 - 2009

Thanks to political connections, Vlaisavljević managed to rise from the position of Jat’s ground handler to CEO over night. During his time, the bulk of the management was replaced with those from the airline’s handling division at Belgrade Airport. Vlaisavljević heavily reduced the airline’s network of destinations, closed several key representative offices around Europe (where ticket sales rapidly decreased afterwards). He is also ‘credited’ with signing a damaging agreement with Montenegro Airlines from which Jat is still recovering. Vlaisavljević also made several announcements during his reign that Jat will go bankrupt which caused extensive damage to the company’s business. After being declared incompetent to lead the airline, the government awarded him with a job as Belgrade’s City Manager but it lasted for three weeks before he got into a dispute with the city mayor. He now serves as one of the many Vice Presidents of Serbia’s Chamber of Commerce.

Nebojša Starčević, in office 2005 - 2007

Coming from a small insignificant party within the governing coalition, Starčević spoke out against competition and the granting of licenses to other airlines to operate to Serbia. A few years later when he was promoted as head of Serbia and Montenegro’s Civil Aviation Directorate he argued that Jat had no future and granted rights to every airline to operate flights to the Serbian capital. Starčević had no experience in running an airline, working beforehand at a “Centrotekstil” shop in Moscow. He famously told the media that he never flies Jat because he wants to leave free seats for potential passengers. During his reign more than half of Jat’s fleet was grounded.

Aleksandar Miltuinović, in office 2004 - 2005

Milutinović’s short reign as CEO will be remembered as the closest Jat got to declaring bankruptcy. During the year, Jat technicians went on strike for over a month. The walkout was followed by cabin crew and pilots. The airline was forced to lease foreign aircraft and technicians from Tunisia. After his handling of the strikes, Milutinović was sacked as CEO but was soon rewarded by being posted as the representative of the airline in Athens.

Predrag Vujović, in office 2001 - 2004

Vujović’s reign was marred by mass layoffs within the airline which at the time counted over 2.000 employees. During his time the airline rebranded as Jat Airways and resumed many services. His downfall came after he got into a dispute with the airline’s pilot union. He later unsuccessfully tried to launch the low cost airline Centavia. Vujović now works privately but was a few years ago posted as advisor to the Minister of Infrastructure in the Serbian government.

A worrying trend is that all of Jat’s recent CEOs were later promoted to other positions despite all being sacked due to mismanagement. EX-YU aviation news has over the past two years reported on mismanagement in other national airlines in the former Yugoslavia as the trend is not unique to Jat.

Ryanair to skip Montenegro

No Ryanair flights to Podgorica this winter

Ryanair won’t be commencing flights to Montenegro this winter, despite earlier announcement from the government that the no frills airline would do so. It is believed the Government of Montenegro and Ryanair couldn’t find common ground on the strict terms laid out to the low cost airline. Ryanair was expected to commence flights to Podgorica at the start of the 2011/12 winter season and was obligated to carry 100.000 passengers out of Podgorica in one year and carry 50.000 passengers during the low season, from October until May. Furthermore, the airline was required to fly to and from Podgorica throughout the year, rather than during the high season only, so as not to receive special treatment over the national carrier Montenegro Airlines.

The two sides negotiated for the airline to operate flights to Podgorica out of Glasgow Prestwick Airport and London Stansted. The Montenegrin government is now hoping to sell Montenegro Airlines by the end of the year and then grant licenses to low cost airlines to operate flights to both Podgorica and Tivat which would in turn boost tourism numbers.

Meanwhile, Zadar Airport in Croatia, which has flourished since Ryanair introduced flights to the city, is expected to get a new direct service from Barcelona next year as Ryanair negotiates with airport officials. The service would accompany the airline’s existing seasonal summer flights from Charleroi, Dublin, Hahn, London, Moss, Stockholm and Weeze. The low cost airline is also expected to commence flights to the Slovenian capital next summer from Dusseldorf and Dublin.

Adria on sale in March

Adria prepares for privatisation and keeps Banja Luka flights

The Capital Assets Management Agency of Slovenia has announced that it will begin Adria Airways’ privatisation process in March 2012 at the latest. Economists believe the Slovenian national carrier could attract interest from Qatar Airways, Emirates and the Air France-KLM group. Over the past year, Star Alliance partner Lufthansa has also been rumoured as a potential buyer as well as the financially troubled Air India.

Adria recently began its restructuring process by suspending several destinations, formulating a new fleet plan and composing a new collective agreement for its staff. However, the airline is still facing problems. Robert Vuga, the carrier’s Executive Director who has played a key role in securing a government bailout over the past several months has announced he will resign from his post. Furthermore, the airline recently endured negative publicity after it cancelled one of its Ljubljana - Sarajevo - Ljubljana flights due to poor loads. The few passengers were put on a bus and were driven to their final destination. They were not offered alternatives on other airlines nor were they offered a refund for having to travel by bus.

Meanwhile, Adria has reconsidered its decision to suspend flights to Banja Luka. The airline will continue four weekly flights to Bosnia and Herzegovina’s second largest city, operated by a CRJ200. However, flight times have changed with aircraft departing Ljubljana late in the evening while the return trip to Slovenia’s capital takes off at 05.30 in the morning the next day. The news will be warmly welcomed by Banja Luka Airport which will see direct flights to Copenhagen, Zurich and Ljubljana this winter.

New Priština terminal on schedule

Future look of Priština’s new terminal

The construction of the new multi million Euro terminal at Priština Airport is on schedule with the ground floor currently under construction while building work has been completed on the underground floor. Government officials praised the Turkish-French consortium, Limak Holding and Aeroport de Lyon, which are overseeing the construction of the new terminal and will run Priština’s airport for the next twenty years.

The investment is worth 120 million Euros and will see the construction of a new terminal stretching over 42.000 square metres, a new control tower, an apron able to accommodate nine Boeing 737 jets, three air bridges, a car park for 1.750 vehicles, a new access road from the city to the airport and the widening of taxiways. A total of 150 people will work inside the new terminal, expected to open in January 2013.

Construction of Priština's terminal progresses

This year, Priština is battling for the title of the third busiest airport in the former Yugoslavia, competing against former place holder Ljubljana and the surging Dubrovnik and Split. Priština Airport has recorded strong growth this year. In 2010, Priština Airport handled 1.305.532 passengers.

B&H to launch new Banja Luka flight

From Banja Luka to Copenhagen

B&H Airlines CEO, Altan Buyukyilmaz, recently announced that the Bosnian carrier will launch several new flights over the next few months. The first new service to be introduced is from Banja Luka to Copenhagen, in order to aid the struggling direct service from Sarajevo. Flights from Sarajevo to Copenhagen will no longer operate nonstop, instead, they will make a stop in Banja Luka. B&H Airlines will operate the service twice per week using an ATR72, meaning that passengers will endure a three hour trip to the Danish capital. Flights commence on October 31. This will come as good news for Banja Luka Airport which is experiencing financial problems.

Due to lower passenger numbers one of B&H Airlines’ ATR72s is now serving both the airline’s Amsterdam and Copenhagen flights, resulting in longer flight times. The Airbus A319 is currently being used for the evening Istanbul flights while another ATR72 (registration E7-AAD) has been out of service for weeks.

B&H Airlines has had a difficult year with the carrier suspending several key routes including Frankfurt, Vienna, Stockholm and Gothenburg. However, it has managed to maintain passenger growth throughout 2011. The Bosnian carrier is yet to officially announce its 2011/12 winter season timetable.

Jat surpasses million

Jat surpasses 2010 end of year result

Yesterday, Jat Airways carried its millionth passenger for the year, the carrier confirmed to EX-YU aviation news. Therefore, the airline has surpassed 2010’s end of year result when it failed to welcome its millionth passenger for the first time in five years. In the first twelve days of October, the Serbian national carrier has seen 43.899 passengers board its aircraft. Last month the airline recorded an increase of 18% compared to the same month last year, seeing a total of 125.431 passengers. Jat’s passenger results have improved on average by 15% compared to last year. However, the increase in passengers is not resulting in profit. By launching seven promotional ticket sales so far this year the airline has managed to fill its aircraft but has also managed to hurt it’s already less than perfect financial performance. Promotional ticket sales even went throughout the high season. A total of twelve out of fourteen aircraft are currently in operation.

Adria Airways is also expected to see its millionth passenger by the end of the month. Croatia Airlines, which will see a record breaking year, carried its millionth passenger on July 20, the earliest it has done so. Montenegro Airlines and B&H Airlines have never managed to surpass the magic million in one year, although the Montenegrin carrier is closer to achieving this goal than its Bosnian rival.

JAT Yugoslav Airlines carried the most passengers in 1987, flying a total of 4.531.000 people. In 1988 the airline carried over 4 million passengers for the last time and recorded a profit of 55 million US Dollars. Things went downhill from then on.

Six left in Zagreb terminal race

TAV fails to make the second round

The tender to choose who will partially finance and run Zagreb’s long awaited new terminal is entering its final month. From the original ten offers, a total of six have made it into the second round, although the Croatian government has refused to reveal the names of those companies. Now, Croatian media have reported that the six airports vying to build and run Zagreb’s new terminal are: GMR Infrastructure & Flughafen Munchen (Munich Airport), ADC & HAS Airports (Houston Airport), J&P Avax & Athens International Airport, Flughafen Zurich (Zurich Airport and Turkish airport operator), Seoul Incheon International Airport and the French Riviera Airport Consortium. As a result, the high profile bid submitted by TAV Holdings & TAV Construction from Turkey has been rejected. According to local media reports, TAV is demanding for the tender process to be halted, arguing that corruption has been involved. However, the tender has been successful since it managed to attract ten well established companies. The bid submitted by Houston Airport is believed to be the favourite.

The tender to find a partner to participate in a joint public private partnership with the Croatian government began back in April. The winning bid should be announced during the month. However, since the start of the second round of the process was delayed by almost four weeks it is unknown whether these delays will prolong the second round as well.

Construction of the new terminal is set to start in late 2012. The value of the project is estimated at up to 220 million Euros. The conditions of the tender outline that bidders must not own an airline, must not depend on state financing and are not allowed to be in ownership of any other airport within a 400 kilometre radius from Zagreb. Under these conditions Vienna Airport was disqualified from the race due to its close proximity to Croatia’s capital city.

Golden Air takes off from Maribor

Maribor gets London and Vienna flights

The newly established airline Golden Air, based at Maribor’s Edvard Rusjan Airport, inaugurated services last week from its hub to London Stansted Airport, with little success so far. Behind the new airline is a British businessman of Indian descent, Harjinder Singh Sidhu, as well as the Slovenian company Avio Fun. The first week of service saw only three passengers with the airline, which originally planned to operate a Boeing 737-300 on the route, using a Cessna 510 Citation instead. The service operates via Vienna. Although a return ticket from Maribor to London will set passengers back only 150 Euros, the airline has seen little advertising or publicity. Questions are being raised whether the route will survive for long.

Urban Simčič from Golden Air says the carrier will not throw in the towel and will continue to operate the three weekly service. He adds that it will take up to six months for the airline to reach a 70% cabin load factor which is needed for the Golden Air flights to make a profit. “We want to take advantage of Slovenia’s great tourism potential. The next six months will be crucial for us as we need to make a profit”, Simčič said.

Singh Sidhu from India, one of the key investors in the Golden Air project, purchased Air Slovakia in 2006. Four years later the airline ceased operations. If Golden Air’s flights to London and Vienna prove successful, the newly formed airline plans to expand next year with flights to Birmingham, Bergamo in Italy and Amritsar in northern India. There is hope that the new airline will revive Maribor Airport which hasn’t seen scheduled flights taking off for the past three years.

Police investigate Montenegro Airlines

Corruption investigation against Montenegro Airlines widens

During last week, police in Montenegro seized documents from the national carrier’s head office in Podgorica in an ongoing corruption investigation. The seized documents relate to the way Montenegro Airlines has debited airport taxes since 1994 until 2009. Furthermore, police is checking whether a newly purchased company car was bought legally by the airline. It is not the first time that the carrier and its management have come under investigation for corruption. Montenegro Airlines’ management is also being investigated for the way it set up its planned Serbian subsidiary, Master Airways, in Niš. In addition, the company is being scrutinised for the lease of a Fokker F100 to the now defunct Albatros Airways from Albania several years ago. The latest investigation comes days after Montenegro Airlines’ CEO, Zoran Djurišić, slammed the government for attempting to privatise the airline.

“Montenegro Airlines has no secrets and all of the business decisions it makes are in accordance to regulations and the law”, the airline said in a press release late last evening. “Over the past week, the premises of Montenegro Airlines were visited by police under the orders of the State Prosecutor. The police were interested in specific activities that have taken place in the company concerning regular company business”, the airline says. However, much of the carrier’s business performance is unknown to the general public. Until this year, the public was unaware of the airline’s mounting losses nor has the airline revealed how many passengers it has carried. Montenegro Airlines has also kept quiet the news that it is no longer a member of the Association of European Airlines. Admitted into the group of over thirty carriers in January 2010, it has been suddenly dumped without any official explanation.

Last week, the company Airports of Montenegro accused its main customer for failing to forward airport taxes for Podgorica and Tivat airports (included in the ticket price). It says that, as a result, its business has lost 8.3 million Euros.

Jat overtakes Adria

Double digit September growth for Jat

Jat Airways recorded strong passenger growth in September, continuing its positive run which began late last year. In September, Jat carried 125.431 passengers, an increase of 18% compared to the same month last year. If the fledgling charter traffic was to be excluded from the statistic, growth in September would reach 21%. The airline’s average cabin load factor increased eight points on last September and stood at 74%. The national carrier saw passenger figures improve by 33% on flights to and from Montenegro, although it should be noted that the number of flights operating from Belgrade to Podgorica and Tivat increased by 22%. With the number of flights increasing only by 1% on Euro Mediterranean routes, Jat saw passenger figures increase an impressive 19%. Despite the number of charter flights increasing by 4%, passenger numbers declined by 8%.

So far this year Jat has welcomed onboard 956.101 passengers, an increase of 15% compared to the same period last year. The airline should surpass the one million passenger mark this month. During September, Jat surpassed Adria Airways as the second busiest airline in the former Yugoslavia. By the end of September Adria carried 942.856 passengers, with numbers sliding on recent rumours of debt, bankruptcy and cost cutting. Croatia Airlines remains unbeatable as the busiest airline in the former Yugoslavia. The Croatian national airline carried its one millionth passenger back in July.

You can review all of Jat Airways’ results from this year in the table below.

Month	PAX	Change (%)
JAN	70.788	▲ 3
FEB	67.635	▲ 24
MAR	79.408	▲ 20
APR	88.597	▲ 33
MAY	96.466	▲ 17
JUN	116.105	▲ 18
JUL	156.508	▲ 8
AUG	155.163	▲ 6
SEP	125.431	▲ 18

Turkish close to Montenegro takeover

Government cheering for Turkish takeover

The Montenegrin government has announced that “Turkish Airlines is close to taking over Montenegro Airlines and the country’s airports”, national broadcaster RTCG reports. However, the government adds that it won’t sell the national carrier at any cost. If it decides that it is not the best time to privatise Montenegro Airlines, the government will offer Turkish Airlines certain privileges at either Podgorica or Tivat Airport, would initiate stronger cooperation between the flag carriers of both countries and would offer the Turks an opportunity to redevelop Berane Airport in the country’s north-east. This kind of approach will be made possible by the signing of an Intergovernmental Agreement which is being drafted at the moment.

Earlier in the year, the Government of Montenegro announced that it will sell a 30% share of Montenegro Airlines through a public tender by the end of the year after a failed attempt in 2010. This led to fierce criticism from Montenegro Airlines CEO, Zoran Djurišić. “The national carrier is having financial problems but in reality every airline is except for Turkish Airlines which is why we want them as partners”, the Ministry of Transport said in a statement. The extent of Montenegro Airlines’ troubles are unknown to the general public. Problems began this year when the airline was forced to suspend several routes and the government wrote off multi million Euro debt. Recently, the company that runs both of Montenegro’s international airports said its business was being jeopardised at the hands of Montenegro Airlines’ unpaid debt to Podgorica and Tivat.

Kraljevo welcomes first flight

Jat lands in Kraljevo

Morava Airport in Kraljevo handled its first passengers on Wednesday as Jat Airways operated a promotional flight from Belgrade. The first passengers to set foot at Serbia’s newest international airport were President Boris Tadić and Defence Minister Dragan Šutanovac along with other officials. The President toured the airport site and inspected construction work on the 5.000 square meter terminal building. He also visited the newly built air traffic control tower. “This entire region of Serbia has now received a new airport which will be at the disposal of its citizens but will also fuel further investment into the region”, President Tadić said.

Regular flights from Morava should begin next March as the airport’s runway will be lengthened to handle larger aircraft in time for the 2012 summer season. A total of 32 million Euros has been invested into the project. A Jat Airways ATR72 (registered YU-ALN) was used to ferry the President and other officials from Belgrade to Kraljevo and back. Thanks to the VIP passengers, the aircraft was completely refurbished with new leather seats although the airline claims that its entire ATR fleet will receive a new look with the next aircraft, registered YU-ALP, to feature the new interior as well. The flight from Belgrade to Kraljevo took thirty minutes.

First passengers at Morava Airport

Part of Morava Airport, known as Ladjevci, will continue to be used for military purposes. Some have criticised the project as a political stunt ahead of the first anniversary of the Kraljevo earthquake and next year’s parliamentary elections. They argue the airport won’t be viable. On the other hand, the government says the airport will see flights to Turkey and Germany next summer. The Government of Turkey invested 10 million Euros into the project.

Adria announces route cuts

Adria farewells Banja Luka, London, Paris, Toulon and Warsaw

After months of speculation, Slovenia’s Adria Airways has finally announced its list of suspended destinations for the upcoming 2011/12 winter season. The airline will bid farewell to Banja Luka, London Gatwick, Toulon, Warsaw and Paris and will suspend its Vienna - Frankfurt route along with flights to Dusseldorf originating from Priština. Despite heavy losses on the route, Adria will maintain flights to Istanbul. Over the past few months, Slovenian media have suggested that the airline would suspend flights to Turkey’s largest city as well as Copenhagen. Some routes will see a reduction in frequencies. According to a press release from the carrier, during the winter season (which begins October 30), Adria will operate a total of 163 scheduled flights per week to fifteen destinations.

Adria Airways will operate up to four daily flights from Ljubljana to Frankfurt and three flights per day to Vienna, Munich and Zurich. It will connect Ljubljana with the Macedonian capital eleven times per week while services to Belgrade will be increased from six to eight per week. The airline will maintain flights from Priština to Frankfurt and Munich but will suspend flights to Dusseldorf.

Meanwhile, the airline has also begun shedding its fleet. An Airbus A320 (registered S5-AAT) has left the Adria flock. In its final months for the airline, the aircraft wore the Adria Aviopromet retro livery to celebrate its 50th anniversary. The destination and fleet cuts were brought on by a difficult financial situation which brought the airline to the brink of bankruptcy before being saved by the Slovenian government. The difficult part is yet to come as the airline will be forced to significantly reduce its workforce.

Oman Air cleared for Zagreb

Croatia and Oman ink Air Service Agreement

Oman and Croatia have signed an Air Service Agreement and a Memorandum of Understanding paving the way for Oman Air to begin flights to Zagreb and other cities in Croatia. The agreement was initiated by the Government of Oman. Croatia Airlines, which has also gained rights to operate flights to Muscat, says it is unlikely that either of the national carriers will begin flights between the two countries anytime soon. However, according to Croatia Airlines, the two sides will enter into cooperative marketing to develop and liberalise the regulatory framework for air services and promote tourism, commerce, trade and faster economic growth between the two countries.

Croatia designated Croatia Airlines, Dubrovnik Airline and Trade Air as its official airlines while Oman designated Oman Air. Under the agreement, the designated airlines from both countries can operate an unlimited number of passenger and cargo flights using any type of aircraft. The two countries also agreed to adopt an open skies policy in order to include third, fourth and fifth freedom passenger rights on intermediate routes and beyond. This would, for example, allow Oman Air to operate flights between Croatia and another country other than Oman.

Croatian media have stated that Oman Air could bring many affluent tourists to Zagreb and Dubrovnik, which would have a positive effect on the country’s tourism industry. Croatia Airlines does not have a developed Middle East route network. However, the airline does operate a three weekly service from Zagreb to Tel Aviv in Israel. On the other hand, Oman Air has recently established itself as a fast growing and award winning airline. It operates a combination of Airbus and Boeing aircraft with its fleet also including Boeing 737-700s and -800 series jets. In Europe, the airline operates flights to Frankfurt, Munich, London, Paris and Milan and will soon launch flights to Moscow and Zurich.

Belgrade continues impressive growth

September growth for Belgrade as Kraljevo opens its doors

Belgrade Nikola Tesla Airport handled 316.711 passengers this September, an increase of 15.4% compared to the same month last year. As a result, September was the airport’s third busiest month after July and August. The number of flights operated to and from the airport was virtually the same as last year. The September growth can be attributed to several factors. They include a growing number of people travelling and several major international events which took place in the city. During the month, Belgrade was host to the summit of the Non Aligned Movement which saw over 100 delegations and members of the press. Furthermore, the city hosted a European Union forum and the European Volleyball Championship for Women. So far this year Nikola Tesla Airport has welcomed 2.419.163 passengers.

Serbia’s main airport received good news during the week after LOT Polish Airlines decided to extend its flights from Warsaw to the Serbian capital throughout the winter. Originally, the airline planned to suspend the flights during the winter period due to highly seasonal passenger movement. Flights will operate three times per week and will be code shared by Jat.

Meanwhile, today will mark an important day for another airport in Serbia. Morava Airport in Kraljevo will handle its first flight. A Jat Airways ATR72 is expected to land in Kraljevo sometime during the day, carrying government officials and investors. More about this on the blog later on in the week.

Montenegro Airlines angry at government

Montenegro Airlines against privatisation

The CEO of Montenegro Airlines, Zoran Djurišić, has launched a scathing attack against the government for attempting to privatise the national carrier. “The government knows my stance regarding the privatisation which is why I have been completely excluded from the process”, Djurišić said. He added that privatising the airline will have long term negative effects on the country. Instead, Djurišić says the government should cover the airline’s losses and pressure Montenegro’s largest petroleum company, Jugopetrol, to reduce its unreasonably high costs.

Djurišić’s claims mark the first big rift between him and the government with which he has been in good relations since setting up the national carrier back in 1994. Under the government’s proposal, Djurišić was recently re-elected as the company’s CEO for another four year term, which will see him serve at the top of Montenegro Airlines’ management for 21 years. Djurišić also said that potential ownership by an Israeli or Turkish company would have a negative impact on the country’s tourism industry. “This year we saved the tourism season by carrying almost 300.000 passengers within three months, we filled the state’s budget and thanks to us many other companies have profited, including the airports, Jugopetrol and hotels. With a foreign owner none of this would be required of the airline”, Montenegro Airlines’ CEO concluded.

Meanwhile, Airports of Montenegro, which runs both Podgorica and Tivat airports, accused Montenegro Airlines for not making good on its financial obligations. The company claims Montenegro Airlines owes over 8 million Euros to Podgorica and Tivat. More than half is on airport taxes. Airports of Montenegro says its business is being seriously affected by the national carrier. Montenegro Airlines also owes millions to the country’s air traffic control and Jugopetrol with media sources adding that no one really knows the extent of Montenegro Airlines’ losses or debt.

Last month, the Government of Montenegro said it would soon begin tender procedures to sell a 30% share in Montenegro Airlines after which the new owner would have the ability to take a majority stake in the carrier. A similar attempt last year failed despite interest from El Al Israel Airlines, Etihad Airways and Arkia Airlines.

Wizz, Ryan and Vueling to Ljubljana

Five new airlines for Ljubljana Airport

After the announcement made last week that several low cost airlines will begin operations to Ljubljana, new details have now been revealed. A total of five new airlines will commence flights to Jože Pučnik Airport by the start of the 2012 summer season. They include Ryanair, Wizz Air, Vueling, IZair and Norwegian Air Shuttle. The new arrivals should replace Adria on several routes the national carrier plans to suspend this coming winter. Talks are underway for Ryanair to begin flights from Dusseldorf and Dublin to Ljubljana while Wizz Air would operate a service from its London Luton base. Furthermore, Vueling should commence flights from Madrid to Ljubljana. Previously, the airline had operated flights to the Slovenian capital out of Barcelona. Talks are ongoing with IZair from Turkey to commence flights from Istanbul while Norwegian Air Shuttle could launch flights from Oslo, a service once operated by Adria.

With the prospect of oncoming competition, Robert Vuga, the Executive Director of Adria Airways says that the national carrier should not be affected. “If the new airlines won’t compete with Adria Airways, then we understand the government and their wish to bring more tourists to Slovenia”. The Government of Slovenia has approved a proposal for subsidies to be given to low cost airlines. Earlier in the year it also approved a 50 million Euro bailout for Adria.

The management of Ljubljana Airport sees the new arrivals as a big opportunity for Slovenian tourism but also as a way to improve its sluggish performance when it comes to passenger numbers this year.

Rijeka Airport most improved in 2011

Rijeka Airport sees largest passenger growth in 2011

Most of Croatia’s airports maintained passenger growth throughout August. Rijeka continued its comeback, Zagreb saw solid growth while both Zadar and Osijek saw numbers slide.

In August, Zagreb handled 249.159 passengers, an increase of 7.8% compared to the same month last year. So far in 2011, Croatia’s busiest airport has handled 1.568.005 passengers, an impressive surge of 14.2%. However, growth in Dubrovnik slowed with numbers increasing only 1% despite an increase in the number of flight being operated to and from the airport. In the first eight months of the year Dubrovnik has welcomed 977.085 passengers while Split saw 944.907. With 18.282 passengers, Rijeka Airport enjoyed a 35% increase. So far this year, Rijeka has seen the biggest boost in passenger numbers out of all of Croatia’s airports by handling 59.694 passengers, improving its figures by 24.5% on last year's result. In 2010 due to sliding figures and finances there were suggestions to shut down the airport.

On the other hand, Zadar continued its downward slide. With 49.956 passengers, numbers fell by 11.8%, even though the number of flights operating this August increased. Meanwhile, Osijek handled only 4.124 passengers.

Below you can review the performance of Croatia’s airports in August 2011. Overall, Croatian airports handled 932.045 passengers, an increase of 4.1% compared to August 2010. The statistics have been provided by the Croatian Bureau of Statistics.

Airport	Passengers AUG 2011	Passengers AUG 2010	Change (%)
Zagreb	249.159	231.155	▲ 7.8
Dubrovnik	262.262	259.638	▲ 1.0
Pula	86.686	78.996	▲ 9.7
Split	257.031	246.221	▲ 4.4
Zadar	49.956	56.624	▼ 11.8
Osijek	4.124	5.041	▼ 18.2
Rijeka	18.282	13.544	▲ 35.0
Mali Lošinj	1.797	1.298	▲ 38.4

Jat tender extended

New deadline October 31

The Serbian government has extended a tender call to find a potential strategic partner for a new national carrier, to be set up as a successor to Jat Airways. Although officially the government said the tender is being extended upon the request of interested parties, media speculate that no airline has bought the tender documentation. A similar move was made during the last attempt to privatise Jat back in 2008, when no interest was shown either. The new tender call will last until October 31. The tender originally began back on August 1.

A month before tender procedures began, the Ministry of Infrastructure sent letters to a total of sixty airlines across the world hoping to get companies interested before the tender got underway. Experts say that there are no set guidelines to the tender, that it is unreasonable to ask for an airline company to be a part owner of a still nonexistent future national carrier and that Jat should have been restructured and then put up for sale. Statements made by the government that Turkish Airlines interested in purchasing the Serbian carrier (or setting up a new one) have turned out to be false. The only condition for the future part owner of Serbia’s national carrier is that it must have handled 1.5 million passengers in 2010.

Over the past month, media has speculated that airBaltic was interested in purchasing the tender documentation as well AZAL from Azerbaijan.