Pobeda: an indispensable part of the Aeroflot Group, even as the LCC's growth slows

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Pobeda has firmly established itself in its first two and a half years. The Aeroflot subsidiary, Russia's only low cost airline, has a 5% share of seats in the domestic market, which accounts for 85% of its capacity. Domestic routes will remain its main focus, but it also has a burgeoning international network of 12 routes and will launch Moscow Vnukovo-Karlsruhe/Baden Baden in Oct-2017.

Pobeda enjoyed rapid growth in passenger numbers from its launch in Dec-2014 until late in 2016, accompanied also by strong load factor gains. In 2017 its capacity is falling slightly, but its passenger count has continued to grow, albeit at much slower rates than last year. Nevertheless, it still holds high growth ambitions beyond 2017.

Russia's geography, together with Pobeda's low fares and the lack of LCC competition in the domestic market, often mean that it is the only convenient means of travel between cities. These conditions, together with a focus on a simple product and low costs, helped to make Pobeda profitable in 2016 (only its second full year of existence) and it expects another positive result in 2017.

In its short life, Pobeda appears to have become an indispensable part of the Aeroflot Group.

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