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- 16 Bulevar umetnosti
11070 Novi Beograd
- Main hub
- Belgrade Nikola Tesla Airport
- Business model
- Full Service Carrier
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- Codeshare Partners
- Adria Airways
Air Europa Lineas Aereas
KLM Royal Dutch Airlines
LOT Polish Airlines
Formerly known as Jat Airways, Serbia's national airline was rebranded as Air Serbia in Aug-2013 when Etihad Airways acquired a minority stake from Serbia's Government. Originally established in 1927, it is one of the world's oldest operating airlines. Air Serbia operates extensive services within Europe, the Middle East and Africa and provides charter services through subsidiary, Aviolet as well as wet lease services from its base at Belgrade Nikola Tesla Airport. Air Serbia also operates Air Serbia Technical, an MRO provider.
Location of Air Serbia main hub (Belgrade Nikola Tesla Airport)
492 total articles
22 total articles
Etihad continues to implement new forms of cooperation with its equity partner airlines, pushing beyond the limits of other partnerships not involving a controlling stake. The Etihad equity alliance goes beyond codesharing and revenue-generating activities to also seek cost synergies, which partnerships and alliances have seldom managed to achieve.
Etihad is now moving from specific operational synergies (crew resources, aircraft) to macro financing across the group via a USD700 million joint bond financing transaction in the capital market. The allocation of the funds is nearly 20% each to Etihad, Etihad Airport Services, airberlin and Alitalia; 16% to Jet Airways; and the remainder to Air Serbia and Air Seychelles. This is the first time that Etihad and its equity partners have raised funds together and may be the first such joint financing anywhere in the airline industry.
Etihad's equity alliance consists of non-controlling stakes. Nevertheless, as the airline itself said in a release on 21-Sep-2015, the partners collaborate "through measures which otherwise would only be available through mergers or takeovers". Etihad Airways Partners is looking and feeling more and more like a consolidated group of companies under common ownership and control.
During 2014 a quiet revolution took place in an aviation backwater of Central and Southeast Europe - namely Serbia and in particular Belgrade’s Nikola Tesla Airport.
After recording 5.3% passenger growth in 2013 a figure of almost 32% was achieved at Belgrade in 2014, leaving the neighbouring and much bigger capital city airports at Vienna, Prague and Budapest in the shade, even allowing for the low base figure at the Serbian capital.
This growth was unexpected is and quite surprising given Serbia’s recent political and economic history and the fact that growth has not come specifically from the LCC segment, which is the usual source for ‘secondary’ level airports in Europe. It raises the possibility of Belgrade actually competing with these (regional) giants for pre-eminence throughout an area that is growing in economic significance.
Once rejected by global alliances, Etihad Airways has turned around and established its own partnership platform, "Etihad Airways Partners". Partners has familiarity to existing alliances: commercial relations are emphasised, there are frequent flyer benefits and aircraft will have the Partners logo.
But Partners is not simply a de facto fourth global airline alliance. Etihad is starting small with six members. This view requires Etihad's standard disclaimer that it seeks not to be the biggest but to have the highest quality.
Partners in some ways is a branding of what Etihad has already done, and plans to continue to do, in the loyalty space. Consolidating loyalty programmes reduces costs while providing scale.
Plans by Emirates to introduce service from Dubai to Chicago O’Hare in Aug-2014 continue extensive expansion by the three large Gulf carriers into the United States in 2014. Chicago becomes the ninth US market for Emirates, and the fourth market in the country where Emirates, Qatar and Etihad will compete on services from the Middle East.
Chicago also is the second American Airlines hub where its partners Qatar and Etihad will operate alongside Emirates, who has been courting American, but has yet to persuade the carrier to launch a partnership. Qatar and Etihad are both adding service to American’s Dallas/Fort Worth hub in Jul-2014 and Dec-2014, respectively.
The partnership dynamics in both Dallas and Chicago among American, Etihad and Qatar create ample connecting opportunities and traffic flows for all those carriers. But on a pure scale basis Emirates is still larger than its Gulf competitors, transporting more than double the passengers of Etihad and Qatar during 2013.
airBaltic settles into Etihad partnership for Africa, Middle East & Asia – North America may be next
airBaltic is quietly pleased with initial performance from its partnership with Etihad Airways, under which airBaltic commenced Riga-Abu Dhabi service in Dec-2013. Less than three months on, airBaltic is still observing trends in the proportion of local versus connecting traffic, but Bangkok is an early popular onward destination. CEO Martin Gauss told CAPA that Latvia's growing portfolio of air service agreements can expand the number of codeshares it can place on Etihad flights, enabling airBaltic to sell flights from Riga to the Middle East, Africa and Asia – a potentially huge area it previously had no access to, with its local market base instead using competing airlines.
As Etihad rapidly digests its Darwin Airline and Jet Airways equity stakes and evaluates Alitalia, speculation has mounted on airBaltic being a potential equity partner. Mr Gauss says the first priority for the airline is growing the codeshare – which so far is more important to airBaltic than Etihad – but he does not rule out any possibilities. More concretely in the medium term is gaining better access to North America, with airBaltic considering if a North American carrier can serve Riga and partner with airBaltic, or if airBaltic should serve North America with its own metal. The trans-Atlantic market is appealing but also competitive with joint ventures, and Mr Gauss is not rushing to enter.
The US government has formally stepped in and arguably set a dangerous precedent concerning the new business models being adopted by some of the Gulf airlines in rejecting a request by Air Serbia (formerly JAT) and Etihad to codeshare on service to the US.
The troika of airline lobbying group Airlines For America (A4A), Delta Air Lines and the Air Line Pilots Association formally opposed the request on what is now familiar grounds – arguing the Belgrade-Abu Dhabi–US routings are unviable for the consumer, Air Serbia’s new ownership (Etihad formally took a 49% stake in Jan-2014) is suspect, and the absence of a bilateral agreement with Serbia.
While debate will continue on the merits of the arguments offered by both sides, perhaps another underlying element is Etihad’s and Air Serbia’s plans to bolster the hub at Belgrade. The build-up in Belgrade adds a new competitive dynamic in Europe, one unsavoury to established network carriers within Europe and US airlines serving the continent.