RUSSIA: Pobeda Goes To Pulkovo Airport

Aeroflot low-cost subsidiary Pobeda Airline plans to launch three new international routes from St. Petersburg Pulkovo Airport in October, the airport said.

The carrier starts 3X-weekly Milan Bergamo service Oct. 11; 4X-weekly London Stansted service Oct. 12; and daily Istanbul Sabiha Gökçen service Oct. 28.

The Moscow Vnukovo-based airline will compete on the St. Petersburg-London route with another Aeroflot subsidiary, Rossiya Airlines, which operates flights to Gatwick, and British Airways, flying to Heathrow.

On the Istanbul route, Pobeda will compete with Rossiya and Turkish Airlines, which are connecting Pulkovo with Istanbul Atatürk Airport.

Pobeda launched flights from Pulkovo in October 2015.

During the first seven months of 2018, the airline carried 577,000 passengers from Pulkovo, up 136% year-over-year (YOY).

The airline’s St. Petersburg network included 11 domestic and five international destinations in the IATA 2018 summer season.

Moscow Domodedovo-based S7 Airlines, the second biggest carrier in Russia after Aeroflot Group, also boosts a network from St. Petersburg.


Tourism Observer

RUSSIA: Pobeda Lowcoster Airline To Increase Luggage Carriage Fee From $7.3 To $11.4 Per 10 Kg

Pobeda lowcoster associated with the Aeroflot Group has increased the luggage carriage cost, taking advantage of the warning issued by the Moscow Department of the Federal Antimonopoly Service (FAS), the authority said on Tuesday.

Pobeda airline said earlier that it would increase the luggage carriage cost from 499 rubles ($7.3) to 777 rubles ($11.4) per 10 kg due to the FAS requirement to eliminate the limit of luggage pieces under a promo tariff.

Pobeda’s activities can be interpreted as a desire to increase the luggage carriage costs for citizens, having taken advantage of the FAS Department warning, and boost its revenues at the expense of passengers, the authority said.

The Moscow Department of FAS reported at the turn of August that the regulator ascertained signs of pressing disadvantageous conditions of luggage carriage on passengers.

According to FAS Department’s data, only one individual can use carriage of 10 kg of luggage at 499 rubles ($7.3), while 20 kg at 1,499 rubles ($22) were only offered for others.

This means foisting disadvantageous conditions when providing the service, said Armen Khanyan, head of the Moscow Department of FAS.

A warning on the need to stop pressing disadvantageous conditions on consumers was issued to the airline, FAS said.

Pobeda replied that 499 rubles ($7.3) are for a promo tariff offered exclusively on the website, the service of carrying 10 kg of luggage is priced at 1,000 rubles ($14.6)) to motivate passengers for paying by services online.

The number of luggage items was limited under the promo tariff, the lowcoster said.

The department has not yet received a formal answer regarding compliance of the airline with earlier issued warning, the regulator said.

The authority will evaluate airline activities in detail after receiving the formal response from Pobeda air carrier within the framework of adherence to the warning in terms of antimonopoly laws, it noted.


Tourism Observer

RUSSIA: Pilots’ Salaries And Fleet Expansion Cause Aeroflot Losses

Net losses at Russia’s Aeroflot Group, which is made up of Aeroflot, Rossiya, low-cost carrier Pobeda and Aurora, have short up more than double in the first quarter of this year.

The deficit amounted to RUB 11.5 billion (US$195 million) in the period, mainly as a result of a significant fleet expansion programme and increases in pilots’ salaries, reveals the group’s interim financial statements drawn up in accordance with International Financial Reporting Standards (IFRS).

Russia’s largest airline group expects to compensate for this shortfall during the coming busy high season, which this year includes transporting 2018 FIFA World Cup football fans, many of whom are arriving from this week.

This is the first time that Aeroflot Group has separately published its IFRS financial results for the year’s first quarter, explains Shamil Kurmashov, Aeroflot’s outgoing deputy chief executive of commerce and finance.

It will help shareholders and investors to deepen their understanding of the company and its seasonal trends.

In Q1 2018, Aeroflot Group’s overall revenue increased by 8.5 per cent year-on-year to RUB 111,942 million, driven on by a 6.6 per cent increase in passenger numbers to 11 million.

Revenue from scheduled passenger flights increased by 10.7 per cent year-on-year to RUB 91,107 million.

Revenue performance was affected by an increase in yields, primarily on international routes, due to the weakening of the ruble against the euro and the consequent effect of this on foreign exchange-denominated revenue.

Revenue from charter flights increased considerably in the period — by 18.9 per cent year-on-year to RUB 5,789 million – an improvement due, among other factors, to the strategic expansion of Rossiya’s charter programme.

Cargo revenue rose by 11.8 per cent year-on-year to RUB 3,778 million, as cargo and mail volumes grew by 9.6 per cent.

Other revenue streams decreased by 10.2 per cent year-on-year to RUB 11,268 million due mainly to a decrease in the ruble equivalent of dollar-denominated revenues from airline agreements, and because of a decrease in third-party maintenance services provided by the group.

In January-March, Aeroflot Group members collectively carried 11 million passengers, up 6.6 per cent year-on-year.

In the period, total operating costs grew 14.3 per cent to 123,538 million rubles, with aircraft operating lease expenses growing the most to RUB 18,499 million.

This was a 24.3 per cent increase year-on-year after the expansion of the fleet net increase of 51 aircraft, and 21.1 per cent on operating leases compared with 31 March 2017.

Staff costs rose 15.1 per cent year-on-year in the three-month period, amounting to RUB 21,404 million. This increase was driven by rises in aircraft captains’ salaries, effective from the start of 2018, as well as increases in the number of staff needed to support operational growth.

Fuel costs took off in the period, up by 24.1 per cent year-on-year to RUB 34,042 million. This followed a 17 per cent year-on-year increase in the average price of aircraft fuel in rubles with changes in the price of oil, as well as an increase in flight rotations and flying times.

Operating costs, excluding aircraft fuel costs, increased by 11 per cent year-on-year to RUB 89,496.

Expenses related to aircraft maintenance and passenger service amounted to RUB 21,908 million, a 3.6 per cent increase year-on-year, affected primarily by the growth in passenger traffic and increased airport costs.

Aircraft maintenance costs grew by 3.5 per cent year-on-year in the quarter, to RUB 8,469 million.Maintenance costs were significantly affected by an increase in the volume of technical maintenance work carried out inside the Group.

Other expenses increased by 16.9 per cent year-on-year to RUB 9,192 million, as a result of an increase in reserves set aside for aircraft maintenance in accordance with accounting policy, as well as bank fees and expenses on global distribution systems amid the increase in passenger traffic.

As a result of the impact of all of these factors, the Group’s quarterly EBITDA totalled RUB 10,767 million.


Tourism Observer

RUSSIA: Pobeda Airlines Opens New Routes

Pobeda launched two new connections on the same day on 2 June, commencing services from Moscow Vnukovo (VKO) to Bordeaux (BOD) and from St.Petersburg (LED) to Girona (GRO).

The former 2,906-kilometre route and the latter 2,733-kilometre link will both be operated twice-weekly on Wednesdays and Saturdays with 737-800s.

Neither route faces any direct competition.

The Vnukovo link is the only route Pobeda is currently scheduled to operate to Bordeaux in S18.

It will serve Girona from both Vnukovo and St. Petersburg this summer.

Pobeda has launched a twice-weekly - Thursdays and Sundays link from its main base at Moscow Vnukovo (VKO) to Berlin Tegel (TXL).

The 737-800-operated sector will become the LCC’s fifth destination served from the Russian capital city, adding to its existing flights to Karlsruhe/Baden-Baden, Cologne Bonn, Leipzig/Halle and Memmingen.

Commenced on 26 April, the 1,590-kilometre sector faces competition from Utair, which flies the route on a daily basis.

Pobeda, the Russian low-cost airline, used the last seven days to launch four new routes, two from its main Moscow Vnukovo (VKO) base, and two from St. Petersburg (LED), its second biggest operation in terms of weekly seats.

The average sector length of the four new city pairs is 1,607 kilometres, with the longest being the 2,235-kilometre route from St. Petersburg to Pisa (PSA).

While the shortest service is the 715-kilometre domestic airport pair from Vnukovo to Ulyanovsk (ULV).

In 2018, Pobeda will continue to expand the geography of its flights from St. Petersburg.

In S18 the airline will start flights to Gyumri (Armenia), Girona (Spain), Tbilisi (Georgia), as well to the Russian cities of Kaliningrad, Nizhnekamsk, and Ulyanovsk.

Pobeda premiered its eighth route from St. Petersburg (LED) on 12 January according to OAG schedules, with the carrier commencing a link from Russia’s second-largest city to Magas (IGT).

The airline will offer a weekly (Fridays) 737-800-operated service on the 2,084-kilometre link, with no other carrier presently flying between the two cities.

Pobeda already has a presence at Magas, with a daily rotation to the southern Russian airport from Moscow Vnukovo.

Pobeda commenced flights from Rostov-on-Don (ROV) to Batumi (BUS) on 26 May.

The 666-kilometre link between the Russian and Georgian cities will be flown by the carrier twice-weekly - Wednesdays and Sundays on the airline’s fleet of 737-800s.

No other airline presently operates flights on this city pair.

Batumi becomes the second destination in Georgia that Pobeda flies to from Rostov-on-Don, with it also serving Tbilisi three times weekly this summer from the Russia airport.

Along with the two routes from Rostov-on-Don, the carrier also flies to the Georgian capital from St. Petersburg twice-weekly this summer.

Pobeda now offers three Italian points on its network and a total of 16 weekly frequencies to the country following the introduction of a three times weekly operation to Venice Treviso (TSF) on 21 February.

The link from its main Moscow Vnukovo (VKO) base will join the LCC’s existing services to Milan Bergamo and Pisa.

The 2,066-kilometre sector is operated by Pobeda’s ubiquitous 737-800 fleet, and faces no direct competition.

Although Aeroflot offers a double-daily service from Moscow Sheremetyevo to Venice Marco Polo, while Ural Airlines flies weekly to the same Venetian gateway from Moscow Domodedovo.

Pobeda introduced flights between Moscow Vnukovo (VKO) and Leipzig/Halle (LEJ) on 16 April, with the latter airport becoming the airline’s fourth destination in Germany after Cologne Bonn, Karlsruhe/Baden-Baden and Memmingen.

The airline will operate the 1,706-kilometre route to its newest destination three times weekly using its fleet of 737-800s, with no other carrier presently operating the same airport pair.

Pobeda’s new service is currently the only scheduled route between Russia and the German city.


Tourism Observer

GERMANY: Germania Launches New Routes

Germania has commenced its first services to the French island of Corsica during the last seven days.

Weekly flights (Saturdays) from Dresden (DRS) and Nuremberg (NUE) were started to Bastia (BIA), the second busiest airport on the island after Ajaccio.

The 1,007-kilometre sector from the former airport will be flown by the airline’s 737-700s, while the service from the latter facility will be operated by a mix of Germania’s A320 family.

Both routes were launched on 19 May and neither faces any direct competition.

Germania, on 26 April, launched direct flights between Dresden (DRS) and St. Petersburg (LED).

The capital city of the state of Saxony became a new destination in the Russian airport’s route network and the seventh German city with direct scheduled service.

The LCC operates the city pair twice-weekly with its 737-700 fleet, leaving from the German city on Thursdays and Sundays and the return flights departing Russia on Fridays and Mondays.

In addition to Dresden, St. Petersburg offers direct connections to such German cities as Berlin Schonefeld and Tegel airports by Rossiya Airlines and S7 Airlines respectively.

Hamburg and Dusseldorf by Rossiya, Munich by Rossiya and Lufthansa.

Frankfurt by Lufthansa and Ural Airlines and Cologne Bonn by Pobeda. There is no direct competition on this sector.

Germania now serves the Vienna (VIE) to Rostock (RLG) route twice-weekly (Fridays and Sundays) from 26 May.

The flights, operated by an A319, depart from Rostock at 11:50 and land in Vienna at 13:20, and leave the Austrian capital at 14:05 and arrive back in the Hanseatic city at 15:35.

We are pleased to welcome a new airline at Vienna Airport, namely Germania.

The new route to Rostock makes it even easier for passengers to reach the northern part of Germany, says Julian Jager, Member of the Management Board of Vienna Airport.

The route faces no direct competition. The day before, the airline began weekly (Thursdays) rotations between Hamburg (HAM) and Varna (VAR).

Flown by Germania’s A319 fleet, the city pair will encounter resistance from incumbent SunExpress Germany, which also flies the route on a weekly basis.

The last of the trio of new routes commenced by the airline on 23 May was the addition of another route from its recently opened Palma de Mallorca (PMI) base.

Germania added a twice-weekly (Tuesdays and Fridays) service to Montpellier (MPL) on 23 May. Operated by the carrier’s 737-700 fleet, the 459-kilometre sector will face no direct competition.

Germania has commenced two new routes from Germany this week. The airline began weekly (Fridays) operations from Düsseldorf (DUS) to Gazipasa-Alanya (GZP) in Turkey.

The 2,617-kilometre sector will be flown by Germania’s A319 fleet. By contrast, its twice-weekly (Mondays and Thursdays) operation from Nuremberg (NUE) to Athens (ATH), will be flown on its 737-700s. Neither route faces any direct competition.

Germania has based a second aircraft at Berlin Schonefeld (SXF), and is using the fresh capacity to re-start weekly services (Fridays) to Sharm El Sheikh (SSH), thereby reviving a route between the German capital and the Red Sea resort that has not been available for four-and-a-half years.

The following day the carrier also began services to Fuerteventura (FUE), a route that will operate on a twice-weekly basis (Tuesdays and Saturdays).

Unlike the Egyptian sector, the Spanish city pair will see direct competition from Ryanair (twice-weekly) and Condor (weekly).

Both routes will be flown by the carrier’s 737-700 fleet. Additional new features in Germania’s winter flight schedule from Schönefeld include increased capacity to Hurghada and a new route to Gran Canaria which launches next week.

The airline is committed to a policy for growth at this base, as well as Berlin Tegel.

Germania will achieve 400% growth in Berlin, commented Clauspeter Schwarz, Germania’s COO. This is our response to market changes and a greater presence in the capital.

Engelbert Lütke Daldrup, CEO of Berlin Brandenburg said: We are very pleased with the increased commitment of Germania to Berlin.

The wider range of flight offerings, the development of its bases at our two locations, as well as the maintenance operations at Schonefeld make the airline a key partner for us.”


Tourism Observer

CYPRUS: Significant Increase In Passengers Travelling Through Larnaka And Pafos Airports

There was a significant increase in the number of passengers processed through Larnaka and Pafos airports and a further boost to Cyprus’ connectivity, with the entrance of new airlines and the introduction of new routes, according to Hermes Airports’ official data for 2016.

More specifically, a total of 8,974,163 passengers travelled through the airports in 2016, 1,365,000 more than in 2015, recording an 18% increase. There was a 24.5% rise at Larnaka airport and 2.6% at Pafos airport. According to Hermes Airports’ data, the most important hikes were recorded by the markets of Russia (+47%), the United Kingdom (+13%), Greece (+14.5%) and Israel (+47%).

Moreover, the Cypriot airports’ network was further enhanced by the operation of 10 new airlines and the introduction of 21 new routes, thus boosting the island’s connectivity.

The new airlines, Cobalt Air, Pobeda, TUS Airways, Ellinair, Air Berlin, Azur Air, Yan Air, Wind Rose, Alitalia and Israir, carried some 428,000 passengers, while an increase in the number of flights to existing routes led to an additional 919,000 passengers.

Commenting on the numbers, Hermes Airports’ Chief Executive Officer Eleni Kaloyirou said that 2016 ended on a high note. These results, she noted, “have a direct positive impact on Cyprus’ economy and tourism”.

She stressed, however, that “they do not allow for complacency” and that “the coordinated efforts by Hermes as well as other tourism stakeholders must continue and intensify”. If this is the case, Kaloyirou estimated that this upward trend will continue in 2017.

Despite the surge in tourists, restaurants, clubs, taverns and souvenir shops in Protaras are emptier than ever. Three months into the tourist season and yet owners of tourist businesses in the area have expressed their disappointment.

According to Petros Assia, the president of leisure businesses in Protaras, this phenomenon has been very common in the last five years.

“Although the streets, beaches and hotels in Protaras are full, the rest of the businesses are empty, which has a massive impact on the tourist industry in Cyprus”, said Assia. He added: “I don’t see the situation improving for the rest of the summer months”.

Assia highlighted that this trend is most noticeable in the areas where most “all- inclusive” hotels are located. He said that in other areas with less all-inclusive’ services available, the tourist influx at businesses is much better.

“If this all-inclusive trend is not properly monitored and criteria are set to not only improve it and at the same time protect the rest of the tourist industry, in a few years the climate will be non-reversible,” Assia said.

“This will mean that Cyprus will be just offering hotel services and lacking in the rest that the tourism industry has to offer”. All-inclusive hotels, which increase every year at an alarming rate, offer not only meals but also transportation services and souvenir shops, so tourists don’t spend any money on any other services outside the hotels.

“That is why most of the other businesses in the area are on the brink of bankruptcy”, said Assia. “The lack of profit that the businesses are currently experiencing means that there is no money for upgrades and renovations, which makes them less competitive”.

Assia argued that tourists who visit the island come on a tight budget, and choose to use public transport, do not visit any bars or restaurants or spend any money on shopping.

All-inclusive hotel holidays, especially in Paphos, have become a reality in Cyprus but pose risks for the sustainability of tourism, deputy director general of the Cyprus Tourism Organisation Annita Demetriades said in June 2016. The majority of hotel beds in Paphos are all-inclusive.

“A large number of hotels are offering all-inclusive holidays but negative economic and social effects have been observed in the local community at entertainment establishments, supermarkets, souvenir shops and for excursions,” she said.

To improve the above situation, the CTO, the Cyprus Sustainable Tourism Initiative and the Travel Foundation UK, commissioned the Brighton Hospitality Research Group (BHR) from Brighton University, to further investigate the matter with a view to identifying incentives that could push tourists in Paphos to spend more money and time outside of the hotels.

According to the main conclusions of the study, it was found that among the tourists there was a lack of reliable information in relation to the activities they could engage in outside the hotel complex, and that businesses with something to offer found it was difficult to find a way of promoting what they had to offer.

President of the Cyprus Sustainable Tourism Initiative Philippos Drousiotis, said: “In Paphos, and all over Cyprus in general there is a need to ensure that tourists know the destination and what it has to offer them.”

RUSSIA: Pobeda Airlines Gets Approval To Fly From Moscow To Gyumri In Armenia

Pobeda Airlines has received approval for flights from Moscow to Gyumri - the second largest city of Armenia”, - according to the data of the Federal Air Transport Agency.

The approval is issued on flights seven times a week. Earlier, Pobeda has received approval for flights from Rostov-on-Don to Yerevan.

“Also, since November 16 the carrier will perform the regular flights from Samara airport "Kurumoch" the part of the "Airports of Regions” holding to Alma-Ata”.

The daily scheduled flights to Alma-Ata returns after a one-year pause, earlier “Air Astana” ceased the flights on this route.

Pobeda is low-cost carrier of "Aeroflot" group. The flights are performed by 12 Boeing-737-800 aircraft to 58 destinations, including 8 international (as well through Fly & Bus service).

RUSSIA: Pobeda pops-up in St Petersburg

Touching down in Novosibirsk on the 23 October launch of services from Moscow Vnukovo was the ubiquitous Pobeda 737-800. The Russian domestic operation will be served on a daily basis.

Another airport, another Pobeda 737-800. Perhaps more significantly, this route launch was in St Petersburg, and marked the entry of Aeroflot’s LCC into Russia’s second city. Daily connections from Ekaterinburg and Krasnodar were the inaugural services.

Pobeda, Aeroflot’s in-house LCC, has commenced its first routes into Russia’s second city – St Petersburg (LED). The two routes from Ekaterinburg (SVX) and Krasnodar (KRR) are both inbound services, with no aircraft stationed at Pulkovo yet. All four of the routes would have faced direct competition, had it not been for the demise of Transaero Airlines, which operated on the Moscow Vnukovo (VKO) to Novosibirsk (OVB) route until its AOC was recently revoked.

RUSSIA: Russian Market For Changes,Aeroflot To Absorb Transaero Airlines

Cakes and smiles: There’s some appearance of normality in the way that Russia’s air transport business has continued to function and launch important new routes in the past year, albeit miles behind its economic potential. Transaero Airlines’ flurry of new destinations includes: St Petersburg to Shanghai in June, Moscow Vnukovo to Delhi in February, and Moscow Domodedovo to Malta in April, while Aeroflot’s fast-growing low cost unit, Pobeda, which has generated near-30% growth at Moscow Vnukovo this year, launched Sochi/Adler to Kazan, amongst many other new routes, in May.

The recent announcement that Russia’s (majority) state-owned carrier Aeroflot was going to take over the country’s second biggest carrier, Transaero Airlines, will have a significant impact on competition in the Russian market. Based on latest passenger figures from the Russian Federal Air Transport Agency (Rosaviatsia) the two carriers accounted for 43% of passenger movements on Russian carriers in the first seven months of 2015. Add in the figures for Rossiya Airlines, ORENAIR, Pobeda, Donavia and Aurora, all of which are either fully-owned or majority-owned by Aeroflot, and the market share climbs to over 57%.

Passenger numbers on Russian airlines are up 1.1% in the first seven months of this year from 51.3 million to 51.8 million. While UTair and Nordwind Airlines have seen significant drops in demand, Aeroflot’s LCC Pobeda has made an impressive start, already ranked ninth among the nation’s airlines. Another fast-growing airline is Azur Air (formerly known as Katekavia – IATA code ZF), which has been around for 20 years but has grown its scheduled services significantly in recent times thanks to the acquisition of several 757s and 767s from UTair.
Pobeda driving growth at Moscow Vnukovo

Government statistics for airport traffic in the first six months of 2015 shows a mixed picture. Of the top 15 airports 11 are showing a drop in traffic compared to the first half of 2014, with Rostov-on-Don seeing the biggest drop of almost 17%. The rapid growth of Aeroflot’s in-house LCC Pobeda at Moscow Vnukovo has helped the airport move past St Petersburg into third place among Russian airports. Sochi/Adler is apparently still benefitting from its raised profile and new infrastructure after hosting last year’s winter Olympics.

The fastest-growing airport according to these statistics is Simferopol, in the disputed region of Crimea. Since February 2014 the airport has been under the control of Russian forces and the airport now handles flights almost exclusively to and from Russia. As a result, passenger numbers at Russian airports (including Simferopol) are up 0.5% in the first half of 2015. If Simferopol is not included, demand across Russia’s other airports is down 1.3%.

An Istanbul-style mega-hub for Moscow? These images are from a magazine produced in Russia in 1992 by the anna.aero publisher, Paul Hogan, who was involved in British Airways’ plans for “Air Russia” – a proposed Helsinki-style hub at Moscow Domodedovo. Hogan believes the potential for a Moscow mega-hub as good as Istanbul persists, and this was the subject of his presentation at the CEE Aviation conference in Budapest 3 September.

China and Turkey capacity still growing
Using OAG schedule data (which still considers Simferopol in Ukraine) a comparison has been made for the leading country markets from Russian airports in September 2015 and compared with September 2013. On this basis, not surprisingly, Ukraine has become the leading international country market with seat capacity doubling in two years. However, if we were to exclude flights to Simferopol (which account for 80% of the seat capacity), Ukraine would become only the tenth biggest market, with capacity down 60%.

Again comparing international services between September 2013 and September 2015 reveals that among western European airlines, Germany’s two leading carriers have made significant reductions in seat capacity, with airberlin down 40% and Lufthansa down 50%. In the last week, Lufthansa has suspended three Russian routes; from Frankfurt to Moscow Vnukovo, Nizhny Novgorod and Samara. airberlin has axed its Berlin Tegel-St Petersburg connection and its Munich-Moscow Domodedovo service.
Moscow’s potential as a mega-hub explored

Last week anna.aero’s publisher, Paul Hogan, gave a presentation at the CEE Aviation Conference in Budapest. With the title “How good would it be for Russia’s air transport if everything was normal?” You can download his 20-slide presentation below.

TAV-operated Tbilisi Airport serving the capital of Georgia (with which Russia was at war in 2008) celebrated the launch of Aeroflot’s new daily service from Moscow Sheremetyevo last October. Despite the current crisis, Ukrainian traffic is also up substantially, although the picture is complicated as many agencies and groups – such as OAG – define Crimea’s growing traffic base as part of Ukraine.