Croatia Airlines fends off LCC challenge in Zagreb
Croatia Airlines has successfully held off a challenge from low cost carriers (LCCs) at Zagreb Airport, following talks with relevant stakeholders. As previously reported by the "Total Croatia" portal, both Eurowings and Laudamotion have expressed interest in stationing aircraft in the Croatian capital. The airport's higher fees would have been avoided with the reopening of its old terminal building, which would have been used exclusively by budget carriers. However, as EX-YU Aviation News learns, both Eurowings and Laudamotion have given up on their plans for the time being following strong objections from the Croatian carrier, expressed to both the state and the airport. The company is in the midst of a privatisation process.
Croatia Airlines faces strong competition from low cost carriers across the country, however, its main hub in Zagreb is dominated by full service airlines, which account for over 90% of all seats. Since joining the European Union in July 2013, Europe’s major low cost carriers have focused on serving coastal destinations in Croatia, rather than Zagreb. Only one LCC - Eurowings - maintains services to the Croatian capital on a year-round basis, while Norwegian Air Shuttle and Vueling operate a single seasonal route. This gives Croatia Airlines a fairly comfortable operating environment at its home airport as it attempts to reduce its losses and keep a lid on costs.
Zagreb Airport's General Manager, Huseyin Bahadir Bedir, said in April, "We understand the principles by which low cost carriers do business and we are attempting to find ways to cooperate with them. However, as an airport that handles over two million passengers per year, we have certain obligations which are regulated by the European Union. The two main rules we have to abide by are transparency and a non-discriminatory policy for all airlines. Of course, if low cost carriers find some other ways to subsidise their arrival into Zagreb, we are fully prepared to cooperate". Eurowings has previously said that Zagreb Airport's charges are "significantly higher than most major European airports, making it less appealing for low cost carriers". Commenting on its absence in Zagreb, Wizz Air's CEO, Jozsef Varadi, said recently, "It is a high-priced airport environment with fluctuating demand. Should the costs come down, I think they would attract us".
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