Air Serbia's passenger share tumbles
Air Serbia has seen its passenger share at Belgrade Nikola Tesla Airport decline during the first quarter after rolling out a set of unpopular cost cutting measures and reducing its number of flights. According to Belgrade Airport's quarterly report, the Serbian carrier recorded a passenger share of just 40%, well down from over 47% registered last year. Although not indicated in the report, the airline's passenger numbers are believed to have fallen some 12% from 453.859 during Q1 2017, which was its busiest first quarter since the airline was relaunched in 2013. Over the January - March period of this year, Air Serbia operated some 5.800 flights, down 8% on 2017. At the same time, foreign carriers maintaining services to Belgrade grew their passenger share to 60% and accounted for 51% of all flight operations.
The future operator of Belgrade Airport, VINCI, has said it anticipates for Air Serbia to hold a passenger share of between 40% - 46% on an annual level. The company is facing headwinds and intense competition, in particular from low cost carriers that are increasingly moving in on routes which were previously solely operated by the national airline. In 2017 it faced no competition on 21 scheduled routes, down from 26 the year before. Lately, it has been directly challenged on a number of its services including Amsterdam, Prague, Malta, Larnaca and Tel Aviv. This list will soon grow to include Berlin. Air Serbia recently warned that a "flood of low cost carriers" would enter its home market in the near future.
The airline is also facing growing indirect competition from low cost carriers at Niš Airport in the country's south-east. Last year, just over 7% of all passengers departing Constantine the Great Airport hailed either from Belgrade or the northern province of Vojvodina. Meanwhile, Wizz Air will commence operations from Vienna to Niš this November with its 220-seat Airbus A321 aircraft, further challenging both the Serbian and Austrian national carriers which maintain services between Belgrade and Vienna. Over the past five months, Air Serbia has transitioned into a hybrid full fare - low cost carrier, which has been largely met by a negative response from the flying public. The airline's CEO, Duncan Naysmith, recently said, “Technology has completely transformed the way people travel in the 21st century, and the ability to have a tailor-made travel experience has been central in this process. Measures, such as unbundling air fares, has enabled Air Serbia to better compete and offer more value, while retaining all its differentiating hallmarks, including the fact that we fly to primary airports, run a frequent flyer program, operate a Premium Lounge, provide seamless codeshare flight options through Belgrade and much more”.
