TAROM CEO Christian Heinzmann forecast the carrier will return to profitability with RON92 million (EUR20.9 million) in profit in 2015 increasing to a profit of RON173 million (USD39.3 million) in 2016, according to a report from Bne. The carrier also plans to increase its passenger numbers to 2.6 million by 2016, up from the 2.3 million it expects to transport this year, and load factor of 75%, up from the 64% to 65% at present. In 2013, TAROM is forecasting a loss of RON143 million (EUR32.5 million), compared to previous forecast of a RON252 million (EUR57.3 million) loss, while losses in 2014 is estimated to reach RON18 million (EUR4.1 million). To achieve the carrier’s targets, Mr Heinzmann said the carrier will carry out several measures including introducing new marketing strategy and new route network, “renegotiate some slots so as to carry out only profitable flights.” Other measures include improving IT systems and introducing voluntary redundancy as it aims to cut its labour force by 10%. Mr Heinzmann believes the carrier should have about 1500 employees by 2015.
TAROM targeting return to profitability in 2015, outlines measures to achieve target
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Romania aviation Part 3: Blue Air opens Liverpool base and creates new markets; TAROM feels the heat
CAPA's first two parts of this analysis of Romanian aviation and the country's leading airlines highlighted the rapid, LCC-fuelled growth in the market of the past two years. The home-grown LCC Blue Air has overtaken the national airline TAROM in passenger numbers and fleet size, although Wizz Air is the largest airline in the market and Ryanair is also growing fast in the country. This third part of the analysis considers respective route networks and the competitive positions of TAROM and Blue Air.
Blue Air announced in Oct-2016 that it will establish a base in Liverpool in 2017, with new routes from the UK city to a range of European destinations outside Romania. This is a sign that Blue Air is taking the fight to airlines such as Ryanair and easyJet as it embraces the pan-European LCC model. Blue Air CEO Gheorghe Racaru has said, "The UK is a strategic market for Blue Air and we strongly believe that basing a 737-800 at Liverpool will allow us to strengthen our position as one of Europe’s fastest growing airlines".
For its part, TAROM, loss-making in contrast with Blue Air's profitability, is embarking on a restructuring following a change of management. It is facing increased competition on its network, while Blue Air has targeted its growth on routes where competitors are scarce or non-existent.
Romania aviation 2: LCC Blue Air overtakes TAROM to be nation's biggest home-grown airline
The first part of CAPA's analysis of the aviation market in Romania examined its rapid growth, driven by LCCs. Romania has become an important battleground for two foreign airlines – Wizz Air (the biggest airline in the country) and Ryanair. Local low cost airline Blue Air is also growing rapidly, while Romania's government-owned national airline, TAROM, is stagnating.
This second report on the Romanian aviation market looks at the country's two main home-grown airlines, in particular the development of their capacity and fleet. Traffic data for the two are scarce but it seems that Blue Air, which commenced operations in 2004, is now larger than TAROM by number of annual passengers carried.
After a change of ownership in 2013 Blue Air seems to have been revitalised and has adopted a more pan-European strategy, with bases in Turin and Larnaca and a base planned for Liverpool in 2017. Its growth has also been prompted by the aggressive expansion of Wizz Air and Ryanair in Romania. Blue Air, now bigger than TAROM, became a full member of IATA in Jan-2016.
Part three of CAPA's analysis will present details of the respective route networks and competitive positions of TAROM and Blue Air.