Thessaloniki Makedonia Airport

Aegean Airlines: caught between the devil and the deep blue sea after three annual losses in a row

Aegean Airlines seems to be caught between the devil and the deep blue sea, challenged both by a very weak domestic market and by an increasingly competitive international market where it has neither cost leadership nor a global network. If approved by the EU this year, will its planned acquisition of Olympic Air provide a route to safety?

Aegean reported its third successive loss in 2012, albeit a narrower one than in 2011, as passenger numbers fell by 6%. Aegean managed to reduce costs at a similar rate and to limit the revenue fall to 2% by cutting domestic traffic and international traffic from Athens while growing international traffic from provincial Greek cities. Double digit passenger growth from 2003 to 2009 has been followed by domestic-led decline, with Athens (Aegean’s main hub, where it is the biggest carrier) a falling market. Although it has leading positions at its other Greek bases, LCCs are increasingly making their presence felt there.

Greece to try to lease 21 regional airports as debt pressures force new strategies

For several years now the Greek Government has philosophically contemplated conceding its regional airports to the private sector, even of floating its share of Athens Airport via an IPO, but has been restrained by its indebtedness.

Just as Greece desperately needs help to reduce its massive deficit, its airports lack investor appeal for the same reasons, i.e. the negative effect on both in and outbound travel brought about by the sovereign debt crisis, ultra high unemployment, the possibility that the country may leave the European Monetary Union and even the breakdown of civil order.

Nevertheless it appears the government is finally to make an attempt at privatisation, by leasing 21 regional airports and with the tendering process starting immediately.

Europe's fringe carriers look for partners to overcome financial crisis; Cyprus Airways latest

Airlines on Europe's southern and eastern periphery are becoming more precariously positioned, but are looking for for partners to help overcome the growing financial crisis. Cyprus Airways is the latest such carrier, and reported a widening in first half losses in the six months to 30-Jun-2011, as lower top-line revenue fell and higher fuel costs squeezed the airline in the period. Cyprus Airways is also turning to implementing a raft of measures aimed at stemming operating losses.