Shortage of seats on Vladivostok-Moscow route leads to new entrant

Published: 6/16/1999

The approaching summer has presented the population of Vladivostok with an air transport problem. Even the affluent are finding it difficult to travel, owing to the shortage of seats on the route to Moscow, the most popular of destinations from the Far Eastern city. According to local newspaper, Vladivostok-Novosti, the exodus of two carriers, Orient and Transaero, from Vladivostok has substantially reduced the number of flights from the region. This spring, there were daily flights to Moscow from only Aeroflot and Domodedovo Airlines, with Krasair flying three flights a week. During the vacation period, this capacity has proved inadequate to meet local demand and has spurred local carrier, Vladivostok Avia (VA), to enter the market. On May 30th 1999, it launched its own flight to the Moscow airport of Domodedovo, with two flights a week. During the 10-hour flight, VA stops for refuelling in the Siberian city of Abakan, in the Krasnoyarsky region. VA is using its fleet of 3 Tu-154"s, that it also employs on routes to Irkutsk, Petropavlovsk-Kamchatsky, Blagoveshchensk, Pusan and Seoul. The cost of the return ticket is 3,100 roubles ($119). For VA, this is its first foray over the Urals and one that may be short lived. In the longer term, the larger airlines remain keen to exploit the long haul routes from the Far East, as the impact of the crisis recedes. The ticket prices, however, reflect the difficulty for any entrant to compete on price, particularly with the active support of the regional authorities, as in the case of VA.

Article ID: 591