Air Serbia to phase out ATR fleet

Air Serbia A319

(Air Serbia)

Air Serbia will retire its existing fleet of ATR turboprops, and will decide on a replacement within the next two to three years, CEO Dane Kondić said.
                                                                       
The Belgrade-based carrier owns three ATR 72-200s and leases two more modern -500s. They are used for regional services in southeastern Europe, including routes to cities in states that emerged from the former Yugoslavia during the latter’s breakup in the 1990s.

The ATRs “are getting old,” Kondić told ATW in an exclusive interview, but they had relatively low hours on their airframes and engines because of a combination of Western sanctions on Serbia during the civil wars that limited their use, together with the low daily utilization of aircraft in service with Air Serbia’s predecessor JAT.

While declining to name a replacement for the ATRs, he said the Franco-Italian turboprop “is an aircraft type with fantastic economics,” while the Canadian Dash 8 Q400 “is too much aircraft. The ATR 42, in terms of capacity, is about what we want as our ‘sweet spot,’ but if you have the larger [ATR 72], you have far greater flexibility in how you deploy that.”

Replacements for the current ATRs would probably be leased, he said, raising the possibility of acquiring them from other airlines in the constellation of carriers centered on Abu Dhabi’s Etihad Airways. In 2013, Etihad took a 49% stake in loss-making JAT and swiftly rebranded it as Air Serbia.

“We have the opportunity to look inside the [Etihad] family,” Kondić said. “Jet Airways operates [ATRs], as does Virgin Australia.

“However, at the end of the day we’re under no obligation to do anything that’s bad for this airline. Whatever we get the best terms for … is what we’ll go with.”

Looking at the replacement situation in two to three years’ time is “the prudent thing to do. Leasing aircraft gives us nice flexibility … without making long-term financial commitments.”

Kondić added that estimating how many replacements would be required is “a work in progress” and depends on developments in the region.

He pointed out that several carriers in the region were financially fragile. “If some of the airlines fall over, there’ll be a vacuum. Who’s going to fill that? What we don’t want is low-cost carrier encroachment.” If Air Serbia is to fill any such void, it would be “somewhat opportunistic, but not predatory.”

(Alan Dron - ATWOnline News)