Dots vs Rings

As previously announced, on the same day Jat Airways will be adding frequencies to Athens, Olympic Air will be launching the same route.

 

After a little more than a year, competition is back on the Serbian-Greek market. Today we will take a closer look at what kind of competition we can expect to see on this route.

 

Let’s start by looking at their summer schedules.

Jat Airways

JU438: Belgrade – Athens
12—-7  07:05-09:40            JU439 10:30-11:05
–3—-   10:20-13:00                    14:45-15:20
—45–  17:35-20:05                     20:55-21:30

Olympic Air

OA 391: Athens – Belgrade
123–6- 08:30-09:25              OA392 10:20-12:40

OA 393: Athens – Belgrade
—45-7 16:20-17:15               OA394 17:50-20:30

As usual Jat Airway has shown their inability to provide a consistent schedule which will enable people to connect to Athens via Belgrade.

On the other hand Olympic Air has returned with more or less same schedule as the one before the forced withdrawal from the market.

By taking an even closer look at these flights we can see that both airlines are concentrating on the origin and destination market by providing a limited number of connections via their hubs.
Today we will concentrate on Olympic Air and their strategy in Belgrade. The route has been loaded into the system and a return ticket on the route stands at 247.95 Euros. The cheapest class in not offered on the route, just like there is no business class on board.

Their competitor, Jat Airways, charges 211 Euros for economy class, where as business class stands at 272 Euros. This makes Jat Airways extremly attractive on the route as their business class ticket is just 20 Euros more expensive than Olympic’s cheapest economy class ticket.

Not to mention that Olympic Air will be operating the route using their regional, turboprop, Dash-8 aircraft. This will give Jat Airways another advantage as they use a much bigger and more spacious aircraft, with the possibility of transporting cargo.
The only possible connections in Athens are for the domestic routes and Cyprus. Domestic routes start at 362 Euros, where as Larnaca starts at 492 Euros.

Jat’s route to Larnaca is notorious for being too expensive. If Olympic Air was really interested in stealing some of the passengers, then they are doing it really badly. For example a return ticket with Malév via Budapest costs 412 Euros where as Austrian Airlines charges 327 Euros for the same flight. So in this case, the fastest and shortest route is the most expensive.

So what future does Olympic Air have in Belgrade? In the past year competition became so fierce that even Jat Airways had to reconsider their business plan. To me it seems as if Olympic Air returned with exactly the same kind of strategy Olympic Airways had. However back in those days Belgrade was far from the competitive market it is today.

This is one of the rare times when we can see Jat Airways have more potential on a certain route when compared to their competition. Usually the airline lacks frequencies, adequate schedules, competitive prices… However with six weekly frequencies Jat can offer flexibility to its passengers, the ticket is affordable, it allows up to 30 kilos of baggage, above average business class product etc.

For some the ticket might seem as a bit too expensive for this 1h40 min flight, however we have to understand that this route sees a lot of business passengers who do not mind paying a bit more.

With Jat’s above average business class product and a very attractive prices, Olympic Air might struggle to keep up.

If Olympic Air wants to become more competitive on this particular market then it needs to take radical measures. Some of these include lowering their ticket price to below 200 and upgrade the route to A319 with a business class product.

Otherwise Olympic’s success in Belgrade might be over before it began.

Summer 2011 on Final Approach (Part 2)

In the first part of ‘Summer 2011 on final approach’ we looked at the new routes routes launched and we analyzed why some airlines failed during the Belgrade traffic boom.

With 19% rise in passenger numbers in February, we can assume that the airlines serving Belgrade are more than optimistic regarding the coming summer season.

Today, we will take a closer look at the preliminary summer schedules of the non-aligned airlines (not part of any alliance) and how they are getting ready for the summer.

First one on the list today is the national carrier of Latvia, airBaltic, and their four weekly flights from Riga.

Last summer the airline achieved unexpectedly good results with an average loadfactor of 90%. The airline was forced to discontinue the flights due to a lack of adequate equipment. The lease on their Fokker 100 was expiring in late summer long before the delivery of their new Dash-8.

airBaltic will offer connections to the Baltic states, Scandinavia and Russia via its hub in Riga. The airline offers a business class product, whereas in the economy class section they offer the ‘buy on board’.

You can read the full story here: https://aviationoverview.wordpress.com/2011/02/22/airbaltic-returns-to-belgrade/

In the past Aerosvit operated flights to Belgrade via Sofia using their Boeing B737-400. The weekly flight was mostly for the origin and destination market between Serbia and Ukraine.

With the introduction of smaller regional aircraft such as the Embraer 145 and Antonov 148, the airline was able to increase frequencies by reducing capacity on certain routes, Belgrade being one of them.

After revising their business plan, the airline decided to transform Kiev into a true hub.

The B737-400 was replaced by much smaller E145 (capacity 50 seats) which enabled the airline to increase Belgrade from one to four weekly flights. The initial connecting possibilities via Kiev were limited to just a few destinations within Ukraine  in addition to Tbilisi and Tel Aviv.

Today the following destinations can be reached via Kiev:

Domestic: Dnepropetrovsk, Donetsk. Kharkov, Lugansk, Lvov, Odessa, Simferopol, Uzghorod.

International: Copenhagen, Tbilisi, Athens, Tel Aviv, Almaty, Astana, Krasnodar, Moscow, Rostov, St. Petersburg, New York, Dubai and Tashkent.

With the new, revised summer schedule we can see that in addition to the fourth weekly frequency the airline will have an overnight stop in Belgrade. The stop will enable the airline to have an early morning departure out of Belgrade and in such a way offer better connections in Kiev.

 

Kiev-Belgrade

1—5–  14:30-15:35
-2—6-  22:25-23:30

Belgrade-Kiev

1—5–  16:20-19:15
–3—7  07:05-10:05

 

With this new, revised schedule Aerosvit has become far more aggressive in their operations out of Belgrade. Other airlines with early morning departures include Lufthansa to both Munich and Frankfurt, Austrian Airlines to Vienna and CSA to Prague. Malév was planning on introducing overnight flights shortly before the last summer season. After a sharp drop in passenger numbers the airline decided to postpone the additional flights until further notice.

B&H Airline entered the Serbian market a couple of years ago through a codeshare with Jat. For years now Jat Airways had operated their flights to Sarajevo with an overnight stop. This facilitated connections through Belgrade for passengers travelling between Bosnia and Europe.

However, with one flight per day it was common for passengers to spend several hours at the airport. With growing competition in Sarajevo, most notably from carriers such as Adria, Malév and Austrian Airlines all operating more than 7 flights per week made it obvious that Jat was going to lose the battle.

When Air B&H announced that it was launching afternoon flights to Belgrade, I was personally hoping that Jat Airways would immediately start codesharing on the route.

By fully cooperating with Air B&H, Jat Airways would finally have two daily flights to the Bosnian capital. It was vital for the airline to reduce the connecting time for the passengers in order to become more competitive on the market.

 

Roughly a year after launching the flight, Air B&H had announced the suspension of its service to Belgrade.

With Air B&H gone Jat will not be in a position any time soon to offer the second daily flight. This is mostly caused by a serious lack of aircraft and vision within the management of the airline. Not to mention that Jat has allowed this to happen shortly before the first summer where the citizens of Bosnia can travel without visas.

Cimber Sterling will be adding their third frequency on their Copenhagen-Belgrade route. This summer passengers flying between the two cities will enjoy considerably lower fares due to an increase in competition.

In addition to Cimber Sterling and Jat Airways flying to Copenhagen, the lowcost airline Wizz Air will be operating two flights per week to Malmö.

April 13^th 2011 has been set as the date when the Italian carrier Eagles Airlines is set to launch their flights from Forli to Belgrade.

The route is set to be operated twice per week using a Fokker 100. Forli will be the 4^th Italian city to have a direct air link with Belgrade after Rome, Milano and Trieste.

 

 

As announced yesterday, the Greek carrier Olympic Air will be returning to Belgrade after a year of absence. For those interested full story can be found here: https://aviationoverview.wordpress.com/2011/03/03/olympic-air-returns-to-belgrade/

Olympic Air returns to Belgrade!

 

 

Athens based Olympic Air will be returning to Belgrade! After a decision to revise its network and consolidate its position as the dominant carrier in South-Eastern Europe, Olympic Air will be introducing numerous changes to its flight schedule.

 

Among these changes is the reintroduction of the Athens-Belgrade route. The airline was forced to withdraw from this market after the Greek government handed over the route to its competitor Aegean Air (A3). You can read more on this story here:

Frequencies have not been announced, however the launch date has been set as 27^th March.

Interestingly, Jat Airways has announced that it will be adding additional frequencies on its Belgrade-Athens route the very same day.

Below you can find Jat’s published schedule for the week 27.03-03.04

Departure from Belgrade:

123—7  07:05 (arr 09:40)

—4—    17:30 (arr 20:05)

—-5–    17:55 (arr 20:30)

It will be very interesting to follow Olympic Air’s return to the Serbian market. Shortly before their withdrawal the airline was planning on upgrading the route to a double daily flight. However at that time Jat was their only competition flying just three times per week.

Now, with almost daily flights, Jat Airways will be putting up a fight in order to survive on this market. One of the possible advantages that Jat Airways might have is that it operates the route using a Boeing 737-300. With this plane, Jat will not only provide more comfort to its passengers but will also give its passengers the choice between business and economy class. If Olympic Air decides to launch the route with the Dash-8 it will not be able to provide a business class product or to match the comfort of the 737. However one of the advantages of Olympic’s Dash-8 is that it offers less capacity (68 seats), which means that it will be easier for them to add new frequencies. in the future

So what can we expect from Olympic Air’s return? Could we see Olympic upgrading this route to an A319? Price war? Cooperation by synchronizing their schedules? Code-share?

There is a possibility that these two airlines might create a duopoly, which would prevent them from entering a price-war.

 

 

No matter what happens, best of luck to Olympic Air!