Adria Airways Scales Back Network Growth for 2016
Adria Airways‘ CEO, Mark Anžur, says the airline plans to consolidate its operations next year and scale back plans to expand its route network. The statement is in stark contrast to the airline’s earlier strategy to add a number of new routes from Ljubljana and secondary bases next year.
Speaking to “ATW”, Mr Anžur said, “We are developing our own strategic plan, which can be supported or not by the new owner. 2016 will be a year of consolidation. We will work to maximize the efficiency of existing routes, rather than opening new ones. We have had flight operation problems because of a lack of crew, so we have to fix that and work on our load factor. In 2017, we are planning on growing again significantly”.
In contrast to his latest statements, earlier this year, Mr Anžur said, “Next year we plan to base an aircraft in Tirana and have three daily flights to a number of destinations. We are considering at least two new routes. Italy is a very real possibility. We are already planning new flights for the 2016 summer season from Ljubljana as well. For us, these are interesting destinations as they are important business hubs and offer the possibility of connecting flights. The Iberian Peninsula will certainly be among them. Even Italy would be of interest”.
Over the last two years, Adria has grown significantly, adding routes outside of its home base in Ljubljana. This year, the carrier is expected to post a 16 % jump in passenger numbers and 10 % revenue growth. Only 5 % of that growth so far came from the Slovenian capital. Despite plans to scale back its network expansion, Adria is still looking to add two aircraft to its fleet next year. According to Mr Anžur, these will likely be an Airbus and Bombardier jet. A Bombardier CRJ700 is expected to enter the fleet during the first quarter of 2016, while a CRJ200 will be retired. Furthermore, the airline’s CEO says the Airbus aircraft could be either an A319 with 156 seats, rather than Adria’s existing 144-seat configuration, or an A320.
The A319 has cheaper upfront costs, but Adria also needs to strike a balance between demand for more seats in the summer and weak winter demand.
Commenting on the airline’s ongoing privatisation process, Mr Anžur says, “They [potential investors] have already submitted their bids and very soon the government will shortlist one and enter final negotiations”, noting there are both financial and strategic partners in the running.
Shareholders are selling a 91.58 % stake in the airline. The remaining 9 % will “most probably” be sold as well, the carrier’s CEO notes.