The airline aims for more profitable network(1204 words)

Published: 3/22/2001

On 25th March 2001, Aeroflot introduces a new summer timetable valid until 27th October 2001. Aeroflot will undertake 680 flights a week this summer, an increase of 51% on the 2000 summer timetable. Much of the growth of routes comes from an increase in domestic flights, with 231 flights a week, over 156 flights in 2000. Aeroflot had planned to have 300 flights per week, but was forced to scale back due to lack of licences from the Civil Aviation Authority, the GSGA. Some of the planned routes will start later. Within the CIS, Aeroflot will open new routes to Alma-Ata and Tashkent in summer 2001.Elsewhere Aeroflot will significantly increase flight frequencies to Europe, doubling flights to Paris and flying to London twice a day. The airline plans to increase the use of the A-310 European routes. Elsewhere the airline plans to stop regular flights to a number of destinations including Malaysia, Pakistan, Sri Lanka and Peru, continuing the plan of retrenchment on the flag carrier's international destinations started last year. Aeroflot's representative offices will remain open in these countries. The airline has said that if traffic improves, routes will be reopened, though given the airline's commitment to the Skyteam alliance and the much-vaunted strategy of focussing on the Russian and CIS markets, this would seem an unlikely scenario. Aeroflot plans to fulfil its schedule with a fleet of 67 aircraft, not including reserved and charter aircraft. The expectation is that the company can increase aircraft utilisation over 42,000 flights, from 9 hours 47 minutes a day to 10 hours, reflecting in part, the increasing use of western types by Aeroflot. Currently, its Boeing 767 and Boeing 777 spend 15 hours 52 minutes and 15 hours 50 minutes in the air each day, respectively. The airline says that the new summer schedule is also designed to attract transit passengers flying from Europe to Southeast Asia and the Far East. Valery Okulov, General Director, said the company was particularly optimistic about these transit passengers, as many of the airlines had reduced their services to Southeast Asia and the Far East. He said that Aeroflot now had a competitive price option for passengers from Eastern and Southern Europe, which might persuade passengers currently flying through Vienna, Zurich, Frankfurt or Helsinki, of the virtues of Moscow. In his never-ending quest to keep Sheremetyevo on its toes, Okulov said that docking time at the airport's second terminal is acceptable, while the transit time between the two airport terminals of 2 hours, is not. It falls well short of the 45 minutes achieved, on average, by other international airports and well short of the 30 minutes achieved by the best. Needless to say, Okulov sees this inadequacy as further justification of Aeroflot's commitment to the third terminal, to handle Aeroflot and its partner's traffic at the airport. Aeroflot has already modernised 55 of its aircraft, at a cost of $11.2m, to meet the new Eurocontrol regulations coming into force on 1st April. This means that all its aircraft, with the exception of the Tu-134, meet the installation standards for the TCAS 7 series, RVSM, oxygen equipment, etc. The dropping of the Tu-134 from the programme, according to Okulov, reflected the aircraft's inability to meet the new noise and emissions regulations in April 2002, as the upgrade was judged unprofitable. The airline plans to use the Tu-134s on domestic and CIS routes, in addition to leasing another 2 Tu-134s, the contracts for which are currently under negotiation. Commenting on the implications of the new regulations for the rest of the Aeroflot fleet, Okulov said that only the Tu-154M with hush kit, the Tu-204, the IL-96-300 and the Yak-42 met the stage 3 standards. Other Russian aircraft will not be allowed into Europe, although Okulov did suggest that the Il-62 would be allowed to fly in European airspace with “special engines”. It is unclear however, what these might be, given that the Il-62 is most certainly not stage 3 compliant in its current configuration, as was shown by US efforts to exclude it from Seattle and Anchorage early last year. In terms of improving the quality of its fleet, Aeroflot has modernised the interior of its aircraft, particularly the Tu-154, reducing the number of seats in the process from 156 to 126. They have also installed new seats, improved the cabin interior and the quality of the in-flight menu. The sleeping passenger will also be allowed to sleep, undisturbed by the ever-vigilant Aeroflot cabin crew, by the use of a simple eye mask, saying 'don't wake me up'. The airline's summer 2001 charter programme differs from previous years in that there has been a change in status of the “regular” charter routes to scheduled routes. The increased frequencies of scheduled routes, replaces both regular and charter routes to the same destinations. Those routes remaining attractive to the airline however, where they have no licences, will remain chartered, according to Evgeny Bachurin, director of the airline's revenues management department, who reported that charter routes would only take place to Alicante, Monastir, Palma de Mallorca, Malaga, Tenerife, Hurghada and Iraklion. He said that the change of focus occurred, despite high demand from tour operators for Aeroflot aircraft, but reflected the carrier's decision to focus on scheduled traffic on popular routes and to provide the operators with access to blocks of seats as opposed to complete aircraft. To meet what it sees as growing demand, Aeroflot has increased scheduled flight frequencies to vacation destinations such as Larnaca, Istanbul, and Antolya. The airline has also aimed to attract the vacation traveller by introducing mid-week price deals and over-night flights at lower prices (gaining better flight utilisation). Commenting on the performance of the airline in 2001, Okulov said that the airline had experienced a 19% growth in traffic so far this year, ahead of the previously anticipated 18% growth. Overall, Russian passenger traffic can increase by 5-7% during 2001, although there is less optimism over cargo traffic, owing to over-capacity. Aeroflot does not plan a price increase in the foreseeable future now that fuel prices have stabilised, despite the airline's internal research showing that 75% of passengers were prepared to pay higher prices for better service. The delivery of the Il-96 expected this summer, is looking increasingly unlikely, However, the aircraft is required, as the DC-10 leasing ends in August 2001, with no plans to extend on the terms offered, which are unfavourable given the condition of the cargo market. In an effort to establish its support of the Russian aerospace industry, Okulov claims that the non-delivery of the Il-96-300 has also delayed the launch of direct flights to Chicago and Washington. The lack of aircraft also means that they cannot increase flight frequencies to Southeast Asian destinations, such as Shanghai and Hanoi. Flights to Pakistan, Malaysia, Sri Lanka and Peru have been cancelled. While accepting there may be some basis in these complaints, there is little doubt that the slowness of delivery is in part due to Aeroflot itself and its reluctance to take Russian aircraft. The increasing flack relating to this stance may have given Okulov reason to reconsider his position.

Article ID: 2440