Es­to­nia: airBaltic’s de­ci­sion to buy 60 air­craft is sur­pris­ing – in­vest­ments might not pay off

Baltic News Network - - News -

Es­to­nia’s na­tional Nordic Avi­a­tion Group be­lieves the de­ci­sion made by Latvia’s airBaltic air­line to pro­cure up to 60 new Bom­bardier CS300 air­craft may be a sign of this air­line en­ter­ing the low-cost air­line mar­ket for ma­jor com­pa­nies. This could al­low Nordica en­hance its po­si­tions on the re­gional flights mar­ket.

This kind of num­ber of air­craft is too large for the Baltic re­gion and for in­vest­ments to pay off in the end

Nordic Avi­a­tion Group chair­man Jāns Tamms told BNS that airBaltic’s choice in favour of CS300 and the num­ber of air­craft planned to be pro­cured shows that airBaltic is pre­par­ing to en­ter the largescale pas­sen­ger trans­port mar­ket cur­rently ruled by com­pa­nies like Nor­we­gian, Ryanair, Wiz­zair, easy­Jet and oth­ers.

«It will not be easy, but I wish them luck,» says Tamms.

«If we look at Nordica in this con­text, this is good news for us and a ben­e­fi­cial turn, be­cause our com­peti­tor in the re­gion will start fo­cus­ing on the mar­ket sec­tor dif­fer­ent from our own. It will give us an op­por­tu­nity to be­come stronger in our sec­tor – ser­vic­ing re­gional routes. It would be good if the Baltic re­gion had one strong low­cost air­line and one strong com­pany ser­vic­ing re­gional flights,» com­ments Tamms.

«As the head of an air­line, I am more in­ter­ested in the busi­ness those air­craft are planned for,» he said. «It is clear that such a num­ber of air­craft is too large for the Baltic re­gion. There are not enough peo­ple here for in­vest­ments to pay off,» he added. Latvia’s na­tional airBaltic air­line and Bom­bardier Com­mer­cial Air­craft have an­nounced the sign­ing of a pro­cure­ment con­tract for 30 Bom­bardier CS300 air­craft with op­tion to pro­cure 30 more in the fu­ture. This or­der is an ad­di­tion to the one signed for the pro­vi­sion of 20 CS300 air­craft. It also forms the foun­da­tion for airBaltic’s Des­ti­na­tion 2025 busi­ness plan, con­tin­u­ing the pre­vi­ous Hori­zon 2021 plan. De­liv­ery of the new air­craft is planned to com­mence in Q4 2019. Latvia’s airBaltic fleet has 31 air­craft, 8 of which are Bom­bardier CS300, 11 are Boe­ing 737 and 12 are Bom­bardier Q400 Nex­tGen. airBaltic con­cern’s gen­eral rev­enue was EUR 353,639 mil­lion in 2017, which is 19.6% more when com­pared to 2016. airBaltic pro­vides di­rect flight con­nec­tiv­ity from Riga to more than 70 des­ti­na­tions in Scan­di­navia, Europe, Rus­sia, CIS and Mid­dle East.

Zane Bitere/LETA

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