Why is oneworld unsuccessful in Belgrade?



The presence of oneworld in Belgrade is pathetic! Not only is their passenger share below 1% but they are present in the Serbian market simply through Malév’s 5 weekly frequencies from Budapest.



It is a very well known fact that one of the most lucrative markets from Belgrade is the North American one.

However, in that particular region oneworld’s presence is impressive. This is mostly achieved through American Airlines’ extensive  network in the US, and British Airways’ far-reaching network from London Heathrow.


American Airlines has numerous bases around the United States, two of them being very important for the Balkan passengers: New York and Chicago.

Star Alliance has mounted a very aggressive ongoing campaign in order to establish itself as the dominant carrier in the ex-Yugoslav/Balkan market.

In Belgrade alone they hold an impressive 22% of the market. In June Lufthansa recorded an average loadfactor to Belgrade of 89%. The airline operates the route twice daily with their Boeing B737-300.


For years now Lufthansa has targeted passengers flying from Belgrade to North America. Its subsidiaries, Swiss and Austrian, both offer convenient connections via their hubs. Swiss even introduced a second daily flight in order to offer faster connections. As a result its passenger numbers between Belgrade and Zurich have doubled.


British Airways, as the biggest oneworld member airline in Europe, was at a serious disadvantage due to British visa requirements for Serbian citizens.

This meant that Serbs travelling to North America needed a British transit visa even when connecting through Heathrow.

As British Airways’ O&D market was taken over by Jat Airways (higher frequencies than BA) and Wizz Air (cheap!) they had no option but to direct the aircraft to more profitable routes.

Until the British government decides to remove the visa requirement for Serbian citizens it is doubtful whether British Airways will consider returning to Belgrade.

However, the British government has stated its possible intention to remove the visa restriction in the foreseeable future. This liberalization would likely encourage British Airways’ return to Belgrade, thus posing a serious threat to the current airlines dominating this market.

Not only is a London transit the most direct way for Serbs to travel to the US but it is also the city that serves the greatest variety of US destinations, and with high frequencies.


Currently the only oneworld airline from the alliance in Belgrade is Malév which is struggling to survive.

To make things even worse, both Malév and American Airlines have neglected the Serbian market and the New York flight is not coordinated with the arrivals from Belgrade. This is a major mistake as the combination of Malév and American Airlines could have been the cheapest and most convenient of all thanks to the proximity of Belgrade and Budapest.


If these two airlines had serious intentions about serving Serbia then they should have known that by poaching some passengers from the competition and developing Budapest as a transit hub for Serbs they could have planned Chicago-Budapest in the future.

Without suitable timings between Belgrade and North American flights out of Budapest, Malév will keep on struggling in Serbia.

Serbs are no strangers to Budapest. During the 1990s when air travel was severely restricted out of Belgrade the vast majority of Serbs used Budapest as their departure point.

To make things even more convenient for them, Lot has announced that they will be discontinuing Belgrade services during the winter.

With Lot gone for the winter season Malév should have jumped in with a revised schedule in order to offer Belgrade-New York at affordable prices and with fast transit times.

One major mistake Malév is currently making is that they are trying to attract passengers to connect through Budapest en route  to other parts of Europe. The problem with this strategy is that the market they are trying to get into is highly competitive and far from profitable.

One of their major threats is from airBaltic which has a massive network within Scandinavia with multiple daily departures and cheap fares: both of which Malév lacks.

To make things even worse  airBaltic’s average load factor for June jumped from just over 50% to 74% year on year.

With these catastrophic results Malév should really reconsider their operations in Belgrade. Will they keep on struggling to attract passengers to connect via Budapest to the rest of Europe or will they change their strategy and coordinate their flights with American Airlines in order to fill their flight to JFK?


oneworld’s situation will remain as is and will not improve until Niki joins the alliance.

With Niki in the alliance oneworld passengers will have much greater flexibility when travelling. Currently the airline uses their E-190 aircraft between Vienna and Belgrade. From the winter season the airline will be adding 5 additional frequencies in order to offer better connections at its hub, Vienna.


Besides Malév and Niki the only possible airline we might see in Belgrade is British Airways. The rest have too little demand to succeed in Serbia.



oneworld’s true glory in Serbia cannot be achieved without the return of British Airways!




Who dominates in Belgrade?


Since I started writing this blog I have spent a lot of time looking at the flaws of Serbia’s national carrier, Jat Airways. So today, my focus will be less on Jat and more on the general situation at Belgrade airport.


The summer season kicked off with two extremely strong weeks whereby Belgrade airport saw passenger numbers soar by 27%! At the end of the month the numbers were slightly more modest with a 17% rise. These numbers were more than impressive, but could we say that they are surprising? Belgrade, just like the rest of Serbia was cast into darkness and seclusion by much  of the world throughout the 90s. The decade was one of the darkest periods in the history of Serbian aviation. One could even argue that it was darker than the period of the Second World War when Aeroput just like other European airlines was grounded. On the other hand the 90s were a very successful period for numerous airlines around the world, but not for Jat.

The 90s have come and gone and now it’s time for both Jat Airways and the airport to enjoy a well-deserved period of prosperity. Unfortunately Jat has been unable to use this to its own advantage but on the other hand the airport has been doing very well indeed..

But what is happening with the other carriers? In 2011 Belgrade airport saw its passenger numbers rise by roughly 20%. No matter how impressive these results are we cannot say that all airlines present in Serbia managed to turn Belgrade into a success story.

Some traditional airlines in Belgrade such as Austrian Airlines or Swiss managed to reinforce their already strong presence in Belgrade. Others like CSA or Malév have been failing to cope with the growing competition in the market. Finally some underdogs like Tarom or airBaltic managed to do wonders and consolidate their position at the airport.

Both Tarom and Malév launched flights to Belgrade in December 2009. Tarom did this in a modest manner by using their regional turboprop aircraft operating the route three times per week. On the other hand Malév launched Belgrade with a massive ticket sale and by operating the inaugural flight with their B737-700 carrying airport officials and journalists onboard.

With the resumption of the normal fare structure Malév’s glory started to fade as passenger numbers began to shrink. The airline was forced to reduce both frequencies and capacity on the route. On the other hand Tarom has been adding frequencies, bringing the total to 5 during the 2011 summer season,and their load factor was more than impressive at 71%.

For the sake of simplicity I have divided the airlines into their alliances, whereas those that do not belong to any have been simply tagged ‘the non-aligned’.

As June is the introductory month of the summer rush I have taken the results of Belgrade airport and analyzed them in greater detail.

First stop is a simple insight into the market share of the four players at Belgrade:
70% of June traffic was carried by airlines which are not part of any alliance. A large percentage of the market is held by Jat Airways and Montenegro Airlines: naturally Jat as the national carrier of the republic, and Montenegro thanks to the large demand between the two countries.

Right behind the non-aligned bunch is Star Alliance with 22% of the market. Airlines that dominate within this alliance are Lufthansa, Swiss, Austrian and Spanair. Of these only Lufthansa saw a slight decrease in passenger numbers when compared to last year. However, their numbers are so impressive that even such a small decrease still puts them way ahead of their fellow Star members.

On the other hand Swiss almost doubled its passenger numbers which climbed from 8,728 in 2010 to 13,137 in 2011. This sharp increase was mostly the result of the additional frequencies from Zurich which were introduced in order to offer greater connecting possibilities to North America.

One of the true winners of this alliance has to be Austrian Airlines. They are the only airline from the Star Alliance family to see fierce competition on the route they operate out of Belgrade. In addition to good old Jat, the airline faces the Austrian no-frills airline, Niki. To make things even worse Niki announced the revision of their Belgrade operation which, among other things, includes an additional 5 frequencies during the winter season. With these new flights not only will Niki steal the O&D passengers from Austrian but will start competing for the transit passengers. Unlike Jat Airways, Niki uses their new Embraer E190 jet on the route; not to mention that soon they will become a member of the oneworld airline alliance. By becoming a member of oneworld they will assist Malév in filling the void left by British Airways’ withdrawal from Belgrade. No matter how fierce their competition is Austrian Airlines have managed to keep 51% of the market share between Belgrade and Vienna.

SkyTeam occupies the third position with 8% of the market. Top ranking airlines are Aeroflot, Alitalia, Air France and Czech Airlines. All SkyTeam members except CSA reported growth in June 2011. Most impressive growth came from Aeroflot whose numbers rose from 6,109 in June 2010 to 7,183 year on year. Another airline that managed to see healthy growth was Tarom whose numbers rose from 1,036 in June 2010 to 1,348 in 2011. CSA which had continuously failed to cope with the newly arrived competition suffered greatly and as a result was forced to cut Belgrade from 13 weekly flights to just 4!

Last, and unfortunately least, is the oneworld airline alliance with a pathetic 0,4% of the market! A major blow to oneworld passengers travelling to Belgrade was given last year when British Airways announced their withdrawal from the market prompted by the fact that Serbian citizens still require British visas in order to visit or transit the UK. This has proven to be the major disadvantage to British Airways which, unlike its competitors, could not attract mass transits to North America.

Today only Malév flies the oneworld flag to Belgrade. Unfortunately for them, their future in Belgrade seems uncertain. In June the airline managed to record an average load factor of only 47%, down from 50% same time last year. O&D market between Belgrade and Budapest is next to non-existent which means that Malév has to rely heavily on transit passengers. This puts Malév in a very difficult position and it’s a clear disadvantage when compared to the other carriers in Belgrade. Hopefully once Niki becomes a member of oneworld things will look up for the alliance’s situation in Belgrade.

If we take a closer look at the situation in the market between Belgrade and the Balkans things start to look interesting.

Below is the division of the Belgrade-Balkans market between Jat Airways and other carriers from the region.

In June 2010 the majority of the Belgrade-Balkans market was held by foreign carriers.

A year later this has changed with Jat Airways taking over the majority stake:

This change was probably due to the sharp rise in passenger numbers travelling between major areas of the peninsula. More specifically Jat saw a considerable rise in passenger numbers to destinations such as Istanbul, Athens, Tivat and Podgorica.

Athens remains as the only problematic destination since there isn’t enough demand for a daily B737-300 but it’s too far to be operated by an Atr.

In addition to the above mentioned destinations proving to be a success Jat has regained the monopoly on its Belgrade-Sarajevo route ever since Air B&H withdrew several months ago.

Routes to Croatia have been re-launched with Dubrovnik being the first city. During June Jat Airways managed to record a satisfactory load factor of 71%. Its competition on the route is Croatia Airlines which operates its brand new Dash-8 aircraft. Even if Croatia Airlines is a Star Alliance member and operates a more passenger friendly aircraft on the route, it has failed to attract more passengers. In June 2011 its load factor was only 40%. Both airlines operated equal number of flights between the two cities.

The overall situation in the Balkans is improving with every new season. Year on year passenger numbers between Belgrade and the Balkans have risen by 17%.

In June 2010 that figure stood at 60,559 whereas this year it is 70,678. More than half of these passengers travel between Belgrade and Montenegro. Year on year the number of passengers has risen by 15% (from 36,575 to 42,183).

So what conclusion can we draw from Jat’s positive passenger numbers? Since competition is very much present at the airport could we dare to assume that there is more faith and trust in the national airline of Serbia?

With these positive numbers the future doesn’t seem that grim for the 84 year old airline.


Summer 2011 on Final Approach (Part 3)


The third part of the ‘Summer 2011 on Final Approach’ will look at the success of the oneworld airline alliance in Belgrade.



In December 2009 it seemed as if oneworld’s luck in was about to change. The Hungarian national carrier Malév had announced that they were returning to Belgrade after two decades of absence.

On the 14th of December 2009, Malév’s aircraft (Boeing B737-700) landed in Belgrade for the first time since the discontinuation of the service in 1992.

In order to promote the new route the airline had launched a new campaign where people could purchase tickets for only 1 Euro.By the time the airline launched the flights it had a total of 2.000 bookings for December alone, giving it an outstanding loadfactor of 70%.

With the campaign in place, the winter season of 2009 saw Malév operate a wide range of aircraft between the two cities, ranging from Dash-8 to Boeing B737-800.

True success in Serbia would only be shown during the following summer season, that is after the promotion had passed.

During the summer season in 2009, the airline recorded lower passengers numbers. Still, the route was still considered a success.

True blow to oneworld in Serbia came in late 2010 when British Airways announced its withdrawal from Belgrade. The airline was unable to cope with growing competition from both Wizz Air and Jat. Its presence in Belgrade has been reduced to a simple codeshare with Malév via Budapest.

After the initial success during the previous winter season, Malév started to face its own difficulties. They tried to keep the daily frequency by reducing capacity on the rout by replacing their Dash-8 (72 seats) with E120 Brasilia (30 seats). Eventually the airline was forced to downgrade Belgrade to 6 flights per week.

However, the airline is planning daily frequencies for the upcoming summer season hoping to reverse the current trend.

On the other hand, one can wonder if British Airways will be reintroducing flights to Belgrade this summer. There are numerous obstacles which might reduce the chances of their return. Most importantly Serbian citizens still need a visa to both enter and transit in the UK. Jat Airways and Wizz Air have added additional flights this summer in order to fill the void left by British Airways.

Passengers loyal to the oneworld airline alliance will have to travel on Malév this summer season. It would be surprising that any other member of the oneworld alliance would enter the Serbian market at this point.

However, no matter how unlikely it is that any other member of the alliance would place Belgrade on their route map, only Finnair and Iberia could possibly find interest in the Serbian market.

It’s worth mentioning that in case either airline decides to launch Belgrade, a large sum of money would be needed until the route would start making profit. The fact that Serbian market today is not a large one, or that it is far from a high yielding one might make it less interesting to these two airlines.

To make the return of Iberia even less likely, Spanair had been operating flights from Barcelona for almost a year now. During the last summer season, in addition to Barcelona the airline flew twice per week from Madrid to Belgrade.

This summer the airline is planning on keeping three weekly flights from Barcelona, whereas nothing was mentioned regarding the flights from Madrid.

On the other hand, Finnair would probably record enormous losses in Belgrade. This is mostly due to the large number of airlines flying to the two markets relevant to Finnair, northern Europe and Asia. Northern Europe is very well covered by airBaltic via Riga in addition to Jat Airways, Cimber Sterling, Wizz Air and Norwegian operating flights to numerous cities in that specific region.

On the other hand Asia is very well connected by Aeroflot via Moscow and Turkish Airlines via Istanbul. Aerosvit, a newcomer, is trying to steal some of the Serbia-Asia market and re-route it via Kiev.

My personal opinion is that oneworld’s presence in the Balkans (excluding Istanbul and Athens) is very much dependent on Malév and their vast coverage of the region.

As for Serbia, the only oneworld airline that could return to Belgrade is British Airways from London Heathrow.


However for the time being oneworld will continue to route its passengers via Budapest to the world.