State to "fight for Croatia Airlines"
The Croatian Minister for Sea, Transport and Infrastructure, Oleg Butković, has said the government will fight for Croatia Airlines' survival amid evolving market conditions and increased competition. Mr Butković conceded the situation at the airline was unsatisfactory prior to the pandemic but has been made worse by the global health emergency. However, he noted the state-run carrier has prospects for the future. "There are models based on which Croatia Airlines can function and the government will give its all for that to happen. We will fight for Croatia Airlines", the Minister said. He added, “Croatia Airlines, as Croatia’s national carrier, represents a strategic part of the country's transport infrastructure, and its importance has been amplified during the ongoing crisis because the company has contributed in maintaining the state's connectivity”.
Croatia Airlines is under increased pressure following the opening of Ryanair's base in Zagreb last week which will grow to a 25-destination network operated by three aircraft from early December. The Croatian carrier has been sourcing additional revenue streams and on July 23 leased out one of its aircraft, an Airbus A319 registered 9A-CTN, to German leisure airline Sundair. The jet, based in Leipzig, will operate flights for the German carrier over the remainder of the summer. Croatia Airlines also recently employed the Boston Consulting Group (BCG) to support its post-Covid-19 strategy. BCG will develop plans for how the carrier can tap into unfolding opportunities and focus on preparing Croatia Airlines for the “new normal”.
Croatia Airlines is expected to remain state-owned for at least another two years, the company recently said. Prior to the coronavirus pandemic, the Croatian government set a deadline to privatise the carrier by June 2020. “The privatisation process was halted at the onset of the Covid-19 crisis. This has been done due to unfavourable circumstances and force majeure. Given IATA projections for the aviation industry and the uncertainty surrounding the duration of the corona crisis, it is unlikely this process will be resumed before 2023”, the company said. Prior to the pandemic, Greece's Aegean Airlines and Spanish regional carrier Air Nostrum had both expressed interest in acquiring shares in Croatia Airlines.
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