Airline still remains optimistic about profits and service (540 words)

Published: 8/22/2000

Transaero has reported that it carried 195,000 passengers in the first half of 2000, a decline of 25% on the same period in 1999 and reflecting a 26% reduction in the number of flights made by the Moscow-based carrier in the same period. The two periods, according to Transaero, are however difficult to compare given that the airline severely cut the number of aircraft it operated during 1999, returning several to their lessors. This lack of comparison has left the airline reluctant to forecast possible figures for the full year after carrying 572,000 passengers in 1999. The airline now says that it is focused on maximising the revenue from seats and reported in the first half of 2000 that the seat load factor remained unchanged from the first half of 1999 at 64%. Despite lower revenues, the airline showed a marked improvement in operating profit with a 50% increase in ruble terms to 278m rubles ($9.7m, an increase in dollar terms of 25%. The reason for the improvement, according to the company, is attributed to better management of the fleet, routes and occupancy and also higher revenue per passenger, due to the recovery in ticket prices and the improved mix of passengers attracted by improvements in Transaero's facilities and service. These Improvements are manifested on the ground through executive lounges and free transfers between airport and city and in the air by improvements in the air with better catering and more frequent changes of menu. The airline also said that passengers have also seen the move of the airline from Gatwick to Heathrow as an improvement in the airline's offering, particularly when combined with the airline's safety record of only one incident during the first half compared with 23 for 1998 and eight in 1999. According to Transaero, its safety record is better than the world average by a factor of four and significantly higher than that of Aeroflot. The company has plans in the short term to open flights between Moscow and Strasbourg on 26th August for business passengers and tourists using a Boeing 737, reflecting the appointment of Transaero's appointment as the second official carrier between France and Russia. The other Russian airline is Aeroflot, although the second French slot with Air France remains unfilled. By the end of 2000, Transaero plans to open routes to the Kazakhstan's cities Aktyubinsk and Atyrau under a code-sharing agreement with Air Kazakhstan, joining Transaero/Air Kazakhstan routes to Alma-Ata, Astana and Karaganda. Despite the pressing problems of the state-owned carrier, recently reported to be on the verge of bankruptcy, Tranaero says that it is happy with the cooperation. During September 2000, the airline plans to begin expanding its fleet again with the lease of A-310 from Airbus on a short-term lease, although Alexander Pleshakov, the airline's Chairman, is reluctant to give anymore details of the arrangement. Transaero plans to use new A-310 on routes to Tel Aviv, Alma-Ata and Frankfurt and on other routes, that have higher traffic than can be serviced by the airline's remaining B-737-700 and B-737-200. The A-310 is however, seen as providing a stopgap until the airline can have access to the new Kazan-built Tu-214 with KrasAir.

Article ID: 2016