- CAPA Analysis
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- IATA Code
- ICAO Code
- Corporate Address
- Bani 75b, Buzin
- Main hub
- Zagreb Airport
- Business model
- Full Service Carrier
- Domestic | International
- Star Alliance
- Joined Alliance
- Association Membership
- Codeshare Partners
- Austrian Airlines
Based in Zagreb, Croatia Airlines is the national carrier of the Republic of Croatia and is wholly-owned by the Croatian Government. The carrier operates an extensive network of services within Europe from its base at Buzin, Zagreb. Croatia Airlines became a member of Star Alliance in 2004.
Location of Croatia Airlines main hub (Zagreb Airport)
187 total articles
13 total articles
In part one of our report on Croatia Airlines, we looked at its network and considered its possible appeal to any prospective bidder if the Croatian Government proceeds with reported plans to sell a stake in its national carrier. Interest will likely focus on the international market from Croatia, where it has some strong market positions, although it would bring only limited additional European access to a major Asian or Middle Eastern carrier and faces growing LCC competition.
In this second and final part of our report, we examine Croatia Airlines’ finances and cost base. The group is loss-making since 2008, with a high-cost CASK structure and liable to need fresh equity capital (on top of that provided by the government in a debt to equity swap in 2012).
Having considered any strategic interest in Croatia Airlines, potential bidders will need to assess the feasibility and timing of any return to profitability and factor in the likelihood of having to inject more cash into the company. It will be a challenging sale.
Following recent reports that the Croatian Government plans to sell a stake in its 98% owned national carrier by 15-Oct-2013, media reports have linked Garuda Indonesia, China Southern and Etihad Airways with a possible bid for Croatia Airlines. All three have denied that they are in talks about an acquisition, but attention is likely to focus increasingly sharply on the loss-making Zagreb-based carrier.
Around 20% bigger by number of seats than Air Serbia (formerly Jat Airways), in which Etihad recently bought a 49% stake, Croatia Airlines is a member of the Star Alliance and has codeshares with a number of European alliance partners. In this first part of a planned two part report, we analyse Croatia Airlines’ network and ask whether it might have some appeal to a prospective bidder. In part two, we will examine its finances and cost base and consider their impact on the possible privatisation.
Montenegro’s small aviation market has been witness to some interesting developments since the Jun-2013 entry of Ryanair. The Ireland-based carrier is now the sole LCC operating in Montenegro with a single route however it has expressed interest in opening up the market further. Other European LCCs will be watching Ryanair’s movements in the market.
The small Southeastern European nation of just under 14,000km2 has a population of only about 620,000. Montenegro’s 2012 GDP was USD4.231 billion, which has significantly increased since 2000 when it was USD1.707 billion, according to World Bank data. Air traffic to/from the country has increased from just under 700,000 passengers in 2005 to 1.345 million passengers in 2012.
Montenegro Airlines is the national carrier and sole scheduled operator. It currently provides around 41% of total seat capacity to/from Montenegro, according to CAPA and Innovata data. Fourteen foreign full-service carriers currently serve the country, accounting for around 58% of capacity while Ryanair, the only LCC in the market, currently contributes around 1% of seat capacity.
Croatia Airlines is confident it can return to profitability in 2012 after significantly narrowing its losses this year despite high fuel prices. The Croatian flag carrier is banking that its future fleet plan, which focusses on replacing three A320s with four A319s, will result in further improvements in profitability as it will be able to better match capacity with demand. New routes to the east are also planned – including Moscow, St Petersburg and Sofia – to balance a network that is now primarily focussed on Western Europe.
Croatia Airlines, which launched services in 1991 just as Croatia declared independence from the former Yugoslavia, has incurred losses every year since posting a breakeven result in 2007. Croatia Airlines CEO Srećko Šimunović expects the carrier to end 2011 with a loss of EUR9 million (USD12 million).
Rumours emanating from Croatia suggest the US-Canadian ADC&HAS joint venture is emerging as front runner for the concession to operate Zagreb’s Pleso Airport even though it does not satisfy one of the criteria demanded of potential concessionaires.
The UAE General Civil Aviation Authority has developed a new organisational structure to transform its management of flight management control operations and safety and security quality standards. GCAA launched its Comprehensive Transformation Programme in 2010 and has already developed new financial and strategic plans.
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