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Aviation Blog

Former Etihad boss holds talks with Slovenian government – EX-YU Aviation News

Challenger 604

Hogan doesn't give up 😀
3, 2, 1, let's hear it from the "concerned taxpayer" brigade.
LOOOOL
Wait a bit more, they have to drink coffee first after really busy morning at APT LJU.
Concerned taxpayer here, drinking tea for a change, and if you prefer money losing carriers (as are all remaining ex yu carriers) just because they have a national flag on its livery, then pls pay it from your own pockets!
If you would do your job and bring airlines to cover Adria frequencies (not only routes) than we would not even have discussion regarding this. And don't forget that you/we are paying for bus/train transport as well and nobody asked us for approval.
Anon 9.34 you ar etotaly right, what if we wpuld stop paying for roads and trains like we stopped for adria?
Well at least the positive thing is that the government still seems to be interested in resolving the issue of the low number of flights.
Two years too late.
^ Some would say better two than three 🙂
True but unfortunately I think we will be waiting for eternity.
I wonder what sort of advice they gave them.
I doubt any, they just probably offered their services. They don't hand out free advice.
I really don't know what Slovenia can do. Even the idea of subsidizing foreign carriers seems to have gone down the toilet. They were supposed to award the second round of subsidies weeks ago but it seems they gave up on the idea.
Is there still a chance that Slovenia might be interested in setting up a national airline? Or are we too far past that point?
Of course there is a chance, bigger issue is if there is a will. Slovenia has all the resources to set up national carrier which will bring connectivity to normal level as it was before. And that all we need..
I think Počivalšek is interested in setting up an airline. If Montenegro could do it in six months I don't see why Slovenia couldn't.
Realistically how long could the process take to establish an airline? I know Air Montenegro was quick but they already had aircraft, staff etc.
You can find any aircraft you want, majority of ex-JP staff would immediately accept offer to work for new national carrier. As I said before, if there is a will then nothing is impossible.
I know what Slovenia can do.
They can rather invest heavily into a super high speed rail network connecting to Vienna, Zagreb, Venice. This would boost the construction sector, drive up the economy and increase in both inbound and outbound tourists, decrease in gas emissions and better connect Slovenia.
How would handing all your international passengers to others boost the economy?
In the EU there is a slow but clear tendency to replace short flights by rail. If Slovenia did this now, they would be ahead of time and well-prepared when that change becomes obligatory. We are talking about flights that may be replaced by rail travel up to 2.5 hours. Without preparation for this you may find yourself just like Balkan coal power plants in the current world of renewables.

So what you suggest that we close airport and invest in rail road infrastructure?
I think that every country needs a bit of both, now Slovenia does not have any of it…
"majority of ex-JP staff would immediately accept offer to work for new national carrier."

Same people, same routes, same mentality. How would this be different from the "we never make profit" Adria?
I don't think I mentioned routes like PAD or RZE as JP was operating in the past. Or to operate for LH/OS while canceling their own flights or flying triangle routes.

JP before 4k was doing quite good job (could be much better of course) but Slovenia was connected much better than after JP demise and before Covid situation. Without national carrier we will never have that again..NEVER!
Quite a good job? How many years of their decades long history did it break even?
and how many airlines did make break even? Please let me know when did train or buses make break even and we are pumping much more money than in JP. Not to consider how many positive effect good connectivity has on national economy.

So I would call that a success!
Two wrongs don't make it right?
You repeat this mantra that short distances should rather be covered by rail than air travel up until the point where the rail goes on a strike, like in Germany currently and you either have to cancel your vacation, or yes, you take a flight instead of a train.
So you admit that investing in rail and busses is also wrong? Why don't we close that as well and let's start travelling by horses once again…
No, I do not admit investing in rail and buses is wrong- my point was that the there should be different travel options available: rail, busses AND air travel. (and horses and camels if there's demand for it).
and we don't have air connectivity at all, so what shall we do? wait a bit longer if any airlines will start flying to LJU? 2 years are not enough, maybe let's wait 20?
a recipe for disaster
Can not be bigger than it is now!
with Mlađa Dinkić involved, of course it can
Hogan & Co attempted the same in Montenegro. At the start of the year they held talks with Montenegrin ministry but the ministry had already received orders to award Lufthansa the consulting contract.
We can laugh but despite all their faults Hogan knows a bit more about aviation then the government.
ŠibicAir Slovenia proud partner of Fraudehad Airlines Group.
Interesting to say the least
What a tandem
Better than the guys they chose to run Adria.
Mrtva trka as they would say 😀
Something really has to be done. Expectations that Lufthansa would cover everything didn't happen, expectation that LCCs would rush to LJU didn't happen so obviously a small national airline is necessary with 2 planes to cover key European cities.
+1
2 planes are not enough, 4 would be perfect! You have to cover FRA/ZRH/BRU/ (MUC/VIE/CDG) in the morning and evening. In second rotation Balkan capitals and that's what Slovenia needs at this moment.
LJU's air connectivity is just OK taking into account that's it's a country less than the city of Belgrade and surrounded by 10 major airports.

C'mon, wake up!

Adria was a SFRJ-era remnant that was funded by public money and if it was profitable to have an air carrier for such a small market, would Adria be bankrupt today?

After all, what doesn't permit all other airlines to add demand/frequencies from wherever they want??

I think Slovenia is simply a bit delusional and megalomanic compared to its size and location.
Take into account how many residents of BEG can actual afford travelling by aircraft? Don't just look into a size of city, there is enough demand to have carrier stationed (with 4-5 aircrafts) at LJU. If that's national or foreign one I really don't care just to bring connectivity back to LJU.

I did not sign up to travel from ZAG/VCE, also tourist will not fly to other countries and then travel by bus/trains/taxi to Slovenia.
So why they don't do it?
I know you didn't sign up, but who has signed up for reality?
In the meanwhile, BEG as you as saying, where 'less people can afford to fly', has about 30 planes based which is alike with BUD.
And yet the largest carrier in BEG despite being much greater in size than Adria 2.0 would be, hasn't turned real profit or even broke even (published profit minus government subsidies) in… a very long time.
I'm sure their swift takeover of the Albanian and Macedonian market Adria held helped them come closer to profitability 😉
@anon 09:58

I think that BEG deserves that but on other hand there is demand for LJU to have 5 aircrafts based as well.
Air Serbia might have a lean business model today but it is still carrying the weight of its past on its shoulders. It will take years to iron out all the failures from the era of JAT and Jat Airways. I am mostly talking about bad business decisions that were made which cost JU millions. Just look at the 1998 Airbus deal and what impact it had on the airline. This is just one of many examples I could list here.

Major difference between JU and JP is that Air Serbia had enough local demand to generate additional revenue. It also helped that the Serbian market is expanding, growing and with it yields are constantly improving. This generates enough capital for JU to invest in reinventing itself and in making sure its business model fits and is useful to its primary customers.

On the other hand, JP operated out of a small market which is why its management had to look around for new business opportunities. They vultured around PRN, TIA and those tertiary German and Polish airports. All the crumbs they collected were not enough.
Turning LJU into a hub never made much sense as JP lacked the funds to invest in new markets where passenger demand would be created to compensate for the lack of O&D. It's because of all this that JP never managed to build up a passenger volume and why it struggled until it eventually collapsed under its own weight.

LJU on the other hand has a chance to build a solid offer but making it sure it has all the major players flying there at least 2 to 3 times per day. They can always secure a deal with some airline to operate summer charters by having a seasonal basis there.

Days of LJU being some transfer hub are long gone and they are not coming back. Best case scenario will be to do some soul searching and to see what they can do to stop Slovenes from flying from other airports and to start using LJU.

In a post covid world I can see LJU handling between 1.5 and 2 million passengers per year.
"Take into account how many residents of BEG can actual afford travelling by aircraft?"

Well, lots of us can, as you could`ve concluded yourself by now.
Like JAT is carrying some business from the past so JP was, it's the same story with a319 and CRJ.

I would say that JP did not invest enough in to PRN and TIA as we can see how those two airports are growing in last few months. But agree that focusing on less important Polish and Germany airports.

Last bot not least, last years clearly show that there is no interest from foreign airlines to base aircraft at LJU and Slovenia has to do something on this area. Either to give much more incentives to foreign airlines or to establish their own which in my opinion would cost same or even less. And this is the only way how to prevent Slovenians to travel from other airports, give them opportunity to travel from LJU and that's it.
@Nemjee
Failures from the era of JAT? Are you aware JAT was number 10 in Europe and number 30 in the World? The first scheduled airline in Europe to get state-of-the-art, at the time NG 737-300? Having 6 MD11 's on order? Starting with its own hotel chain? Introducing "green train" ZAG-LJU at the same time when LH FRA to CGN and DUS and Alitalia Milano-Torino? Increasing punctuality to 93 %? Switching obsolete first class to premium business? Operating charters for foreign operators during low season? Acquireing regional aircraft to improve cost effectiveness? Directly competing against 40 airlines that used to fly to Yugoslavia? Being the only one to connect DXB with China and one of the two (the other KL) to connect DXB with Australia? Operating DC-10 to LHR for immense transfers UK to Australia? Without one single dinar from the state budget. So please, Nemjee, give me a break, failures of Jat Airways, yes, no doubt, absolutely. But please do not put JAT and failure in the same sentence in the future, as compared to what we have today, all over ex-yu, JAT was something we can only dream about and wish.
First thing first, JAT Yugoslav Airlines existed until 2003 as it was only then that it was re-branded to Jat Airways and then in 2013 we got Air Serbia. A lot of luggage Air Serbia carries today came from the late 1980s and onward.
JAT operated in incomparably different market conditions from the ones we have today. We do not know how its management would have coped later on with the deregulated market and the arrival of LCCs. Just look at Adria and what happened to them once they were exposed to capitalism. One could also say that they were fantastically run back in the days of SFRJ.

Second of all, for Serbia and for Belgrade, Air Serbia is incomparably better than what we had back in the days of JAT. Regional connectivity is better, we have up to 6 weekly non-stop flights to JFK (compared to 1 with JAT, all others went via LJU or ZAG), ex-YU network is solid enough, Balkan network is light years ahead of what JAT had and so on.
In a way, one could argue that Belgrade and Serbia lost the most from the AeroPut to JAT transition simply because the focus was no longer on the local market. In 2013, Serbian aviation was reset to where it was before SFRJ.

The world moves on and we need to the same.
First of all, JAT Yugoslav Airlines existed only FORMALLY until 2003. You know very well that actual, real, world class JAT existed till 1991.
Different market conditions today, OK, with that one I agree, but I did not discuss potential development of JAT, just was saying what it had been on its top.
Now, Balkan network light years ahead of what JAT had? JAT had Thessaloniki, Athens, Sofia, So only Bucharest missing. Ex-yu solid enough? No Maribor, no Portoroz, no Rijeka, no Mostar, no no Pristina, no Ohrid. JFK was not once but two times weekly nonstop from BEG, but there was two weekly ORD nonstop which you conveniently forget, not to mention 5 weekly Dubai, all destinations behind and all other destinations in North America. And what about nonstop to Tripoli Cairo, Malta, Baghdad, Amman, Teheran, Damascus, Kuwait? You conveniently forget to write about these too. And Paris Frankfurt, London, Zurich, Vienna, all most important European destinations were served from BEG nonstop as well. 36 planes back than, 30 years ago, BASED in BEG, compared to 20 today. Double number of transported passengers. Double number of destinations in the network. And I fully agree that the World moves on and we need to do the same. We are just moving in the wrong direction, backwards, in the entire ex-yu, and unfortunately, some people blinded by nationalism don't see it.
Officially and formally JAT ceased to exist in 2003.
Yes and I am saying that it was on top (as you claim) because of different market conditions and massive government protectionism which was the norm everywhere back then. With those conditions even OU with its uhljebs would thrive.

Yes, Balkan network is light years ahead because of capacity and frequencies Air Serbia has today. How often did JAT fly to Athens, Thessaloniki, Sofia… and how many weekly flights and seats do we have today? What competition did JAT face on those routes and what kind of competition does Air Serbia have today especially to IST and ATH.

Air Serbia operates commercially today. It tried Rijeka and the route failed even with subsidies. Ohrid was tried as well and it didn't work out. JU is no longer the official airline of Yugoslavia so there is no political pressure to operate routes that do not bring it profit. What kind of market is there in MBX when even FR failed to make it work. Air Serbia is smart to focus on LJU where in 2019 they had 19 weekly flights, 17 from BEG and 2 from INI.

Yes, Chicago is missing but if the second A330 comes next year then it is likely either Chicago or Toronto will be introduced.
Tripoli and Damascus were both operated by Jat in the past. Both airports represent a high risk business environment and JU is smart to stay away.
Malta was tried and they gave up on it as they couldn't compete with Wizz Air. You have Larnaca which was never operated by JAT and where Air Serbia does really well. This is just one of many examples. Dubai is no longer served because Dubai of today is not the same city or aviation market that it was back in the days of JAT. Emirates is king there and its position was further reinforced by the presence of FZ.

Yes those key European markets were served nonstop from Belgrade but at what frequency? Did any of them have more than daily flights? And how many of those routes were operated without any stops in other ex-YU airports.

Many things might be moving in the wrong direction but I don't think we can say the same for the Serbian aviation market.
I can agree with lot of things you wrote. And as regular on this blog, you know I do believe JU is doing good job, for ex-yu environment. Could it be better, yes of course. Is it uncomparably better than other 2, till recently 3, ex-yu carriers, yes of course. But the same way I do accept, and not only accept, but like the fact that we have at least one relatively decent airline in ex-yu, you should accept the fact that JAT had been (until 1991) global player and big and significant airline worldwide. You are totally wrong when saying JAT had "massive government protectionism. JAT was directly competing with other 2 or 3 domestic, and over 40 international airlines. JAT was operating commercialy back than, much more than all ex-yu airlines today, including JU, as it had been receiving no aid at all, at least at its top period 1980-1990 I talk about. In my first post I wrote several examples of such commercial operation. And all your attempts to say very simplified, JAT was bad, Air Serbia is good, can be placed in the same category with ex-Croatian president about having only one type of yoghurt in Yugoslavia. As much as we had one type of yoghurt, that much was JAT government protected and non-commercial.
How exactly did JAT, Aviogenex and Adria compete between themselves? In what manner did they force each other to be better the same way Wizz Air has been pressuring JU to reform for years now. To me it always seemed like each one of them had its own business and there was next to no overlap.

When it comes to protectionism, I am mostly referring to bilateral agreements countries had where frequencies were restricted and where usually no more than two players were allowed to operate flights.

No one is saying that JAT was a bad airline, I never said that once. It was good for its time and era. In the 1980s Yugoslavia had become a relatively well off country where more and more people could afford to travel. This is what caused a boom in the 1980s.

Air Serbia today operates out of a much smaller and poorer market than JAT did. Given the circumstances and everything they went through they are doing more than ok. They still need time to recover fully but I think they are not far from it. I think in 5 years time they are going to be a fully stable carrier especially if the Serbian economy keeps on expanding.
OK, more or less we came to what I wanted to hear – for those times, JAT was not only good, it was very good airline. And bilateral agreements and regulation are not something that we can call special government protection in JAT case but the way all countries and all airlines operated. And now just to answer to your question how ex-yu airlines competed with which other : JAT had its branch called Air Yugoslavia, which handled about 10 to 15 %of overall traffic, and only on charter flights, directly competing with JP and JJ on their charters and "fighting" for every single passenger and tour operator. In addition to that, there were 12 scheduled domestic, most important services (BEG, ZAG, LJU, SKP, SPU, DBV, SJJ…) and 6 international, German, where JAT and Adria competed directly (MUC, STR, FRA, DUS, HAM, BER) and the result was increasing frequencies, offering more convenient timings, and ultimately lowering prices.
The whole point of my argument was not what kind of airline JAT was but rather that today Air Serbia provides more for Serbia than JAT did. This is in terms of connectivity, frequencies and so on. Whether we like it or not, it's the only airline that somewhat resembles JAT and that continues its legacy. After all when they celebrated their birthday, JU put a sticker also commemorating all of its previous forms and shapes, the good, the bad and the ugly.
Concerning the size of the company, number of planes based in BEG and overall number of services JAT had from BEG, I cannot agree with you. But OK, you still think Air Serbia is better for Serbia than JAT had been, and you have every right to think so. And I will not try making you change your mind. However, I will not not let you write about "luggage on shoulders", "bad business decisions", "government overprotection" and "non-commercial operations" for the period 1980-1990 in JAT, because that has absolutely nothing to do with what JAT had been. And that's why I reacted and still am reacting.
The importance of Adria to the Slovenian market has been illustrated in the last two years, despite what people say.
Even with Adria, Ljubljana was still missing many major European cities.
There is simply no demand.
We saw that demand is there, there is no offer to catch those passengers who are flying from other airports.
+1 last anon
Hogan and Dinkic – two guys with a 'truly' successful track record in resurrecting and managing companies and enterprises…. Good Lord!
Yes!
Didn't see this coming!
Well Hogan indirectly played a part in Adria's demise. He sold Etihad Regional to 4K Invest!
haha true
They handed it over to 4k for free.
I don't think it was ever disclosed for how much 4K got Etihad regional.
Dream team
Corona or no corona, situation on the Slovenian aviation market is poor. Something has to be done about it. Maybe Hogan gives some good ideas.
The situation is dire and no matter what you think of Adria it definitely would have been better with them.
If the Slovenian government is smart and did its homework, nothing will come of these talks.
Don't worry. Nothing has come out of any talks the Slovenian government held regarding aviation. You can see in the article they talked with OU, JU, LO, they also held talks with local companies interested in setting up new national airline and you can see the outcome of all of that.
Unfortunately when 4K talked to them something came out of it…
I assume the MD in MD Solution stands for Mladjan Dinkic lol
All the government does is talk. In the end nothing happens. I'm starting to think this is exactly the situation they want with aviation. Lufthansa rules the market. That is most important to them.
The time for action was 2019 when Adria was falling apart and there was still something to be salvaged. Now it's too late.
The only good think in this article is that the talks were held by state secretary. He is a smart guy. But nothing will happen. Be sure nothing will happen.
it certainly is not to late, we missed a lot but if there is a will anything can happen..
@slovavio

True. I've heard the state secretary was very well prepared for this meeting and had a lot of data on Air Serbia and how they went about setting it up and a lot of questions. Let's see what happens.
State secretary is always well prepaired. Smart, quick-witted, he listens and he understands the business in general. No BS with him, but Sadly, he is the only one.

Unfortunately, commercial aviation is not the priority of the ministre. He rather focuses on Portoroz.
Who is metioned state secretary?
Aleš Mihelič
I like how it's not even "MD Solutions". There's only one solution for that guy – lining his own pockets 🙂
Obojica su provereni strucnjaci za to i samo za to, gde god su radili ostavili su pustos i dubiozu za sobom. Takvih strucnjaka se treba drzati podaleko!
I read this piece with a feeling of sadness and equal amount of deep suspicion.

Sad because it's sad to see how the once mighty have fallen. Hogan was once in charge of the 'most exciting' airline in the world (Etihad), the 'sexiest' airline brand in the world (Alitalia), and the 'boutique' one (Air Serbia). Now, he's linked with Air Montenegro and Adria Airways.

Deep suspicion because anyone who used terms like Knighthood or Solution in their branding will force you to remortgage your home for consulting and will result in the same 'solution' again and again: bankruptcy.

Also, can you really trust someone who puts their initials in their branding.

Finally, if it is Knighthood Capital then they must have capital to invest. So, I look forward to seeing them invest their own funds for once.
+1
True
I read this piece with a feeling of sadness and equal amount of deep suspicion.

Sad because it's sad to see how the once mighty have fallen. Hogan was once in charge of the 'most exciting' airline in the world (Etihad), the 'sexiest' airline brand in the world (Alitalia), and the 'boutique' one (Air Serbia). Now, he's linked with Air Montenegro and Adria Airways.

Deep suspicion because anyone who used terms like Knighthood or Solution in their branding will force you to remortgage your home for consulting and will result in the same 'solution' again and again: bankruptcy.

Also, can you really trust someone who puts their initials in their branding.

Finally, if it is Knighthood Capital then they must have capital to invest. So, I look forward to seeing them invest their own funds for once.
For those interested
https://www.knighthoodcapital.com/
Corparate mumbo-jumbo bs.
Slovenia should have a small airline, based on ATR 42/72 planes. It should offer good connections to all LH group hubs – including Dunaj (Vienna) – and to the wider region. It could use all three Slovenian airports if necessary and would certainly not cost much. That ould do much for Slovenia`s air connectivity.
You forgot to mention securing long-haul flights to Japan as there was always huge interest. Remember the Japanese charters? 3 weekly NRT service would be good….
What can these two clowns off to the Slovenian government?
The same what BCG off to OU : split money for "consultant services"
And the result is:
Consultants 1 : Gov/People : 0
Hopefully the Slovenian government will see through them.
With those two, economic disaster waiting to happen…
+1
Not from Slovenia, but always saw it as one of the most developed Balkan countries. I don't understand how a much smaller country like Montenegro managed to very quickly reestablish a new airline and even launch routes.
Since the demise of JP, we've witnessed so many strange stuff going around.
Also, look how ZAG has made a tiny LCC revolution, something LJU should consider.
No demand? Then start paying for the routes until they mature with time just like SKP did or introduce discount airport fees like TIA.
Not much mystery here.

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