However, as it had been set up in the communist era and
operated under state-control, the carrier was not appropriately
structured, dimensioned and prepared for 21st century realities.
As such it was constantly generating debts.
The Serbian government therefore initiated various
transformation processes intended to enable Jat Airways to
operate without subsidies. Nonetheless the airline continued
to accumulate debts and despite two unsuccessful attempts to
privatise the national f lag carrier, the Government of Serbia
received no bids. This despite the fact that the 51% controlling
stake was priced at just 51 million Euros in 2009 and included
the airline’s assets, codeshare agreements, aircraft and airport
slots as well as a share of future profits. The caveat that the new
owner should revitalise the carrier and provide funds for the
purchase of new aircraft was clearly too much of a risk for
most investors.
In 2011 an approach was made by Air India, which
announced readiness to modernise the airline with six Boeing
737-800s and to turn Belgrade into a hub for Air India’s
European services. However, this initiative failed and Jat
Airways continued to accumulate debts.
Air Serbia
After 22 years in a post-communist limbo, a glimmer of hope
appeared for Serbia’s f lag carrier on August 1, 2013 when a
strategic partnership was established between Jat Airways and
Etihad Airways. The latter acquired a 49% stake in the Serbian
carrier along with management rights for a period of five years
starting on January 1, 2014.
Under the agreement, which was kept secret from the Serbian
public for more than a year, Jat Airways became a jointly owned
company that was granted direct and indirect subsidies from
the Government of Serbia to the tune of US$82 million for the
period 2014 –2016.
In addition, as the majority shareholder the Serbian
Government agreed to invest more than US$90 million
in the company, while Etihad was required to invest only
US$40 million. Apart from this, the government agreed to
take over more than US$230 million of the debt Jat Airways
had accumulated. The full details of this contract have
never been revealed.
The carrier was subsequently rebranded as Air Serbia, and
the first visible result of the strategic partnership was the arrival
of an Airbus A319 for the inaugural f light from Belgrade to
Abu Dhabi on October 26, 2013. This was followed by very
fast expansion and rejuvenation of the f leet, which doubled to
21 aircraft in just three years. The introduction of ten leased
A319/320s has led to the average age of Air Serbia’s jet f leet
decreasing from 25 to 10 years. This, in turn, delivers greater
reliability and significantly lower operating costs.
Alongside the newer Airbus jets Air Serbia decided to utilise
four of the best condition Boeing 737-300s it inherited from Jat
Airways. To that end in May 2014 Air Serbia’s charter brand,
Aviolet was established and this now uses the 737s in a spacious
144-seat all-economy layout to serve 20 Mediterranean resort
destinations in Egypt, Greece, Italy, Spain and Turkey. The
1985/86-manufactured jets are also available as scheduled-f light
replacement aircraft for Air Serbia if needed.
Meanwhile, on November 19, 2013 Air Serbia revealed that
it had ordered ten Airbus A320neo aircraft to join the f leet
between 2018 and 2020 to replace its leased A319/320s.
The carrier’s f leet was further boosted in May 2015 with
the arrival of a sixth ATR-72 and a year later Air Serbia
welcomed the arrival of its first wide-body jetliner at Belgrade
international airport. The jet, an Airbus A330-200, was leased
from Jet Airways and was configured with 18 business and 236
economy class seats. The latter enabled the Serbian f lag carrier
to return to intercontinental business 24 years after JAT ceased
such services in May 1992. The A330 currently f lies five times
weekly between Belgrade Nikola Tesla and New York’s John F
Kennedy Airport.
The arrival of these new aircraft transformed Air Serbia
into a reasonably modern and cost-efficient f leet comprising
a single wide-bodied jet, 14 narrow-bodied jets, and six
turboprop aircraft.
It also transformed the airline’s prospects. In 2013 Jat
Airways accumulated a loss of €73 million whereas the
rebranded Air Serbia immediately delivered positive financial
results. In 2014 the carrier produced a total revenue of €262
million and a net profit of €2.7 million. The following year saw
revenue rise to €305 million with profits growing to €3.9m.
In 2016 Air Serbia recorded a third year of operational
growth and handled 2.62 million passengers during the year,
up 3% on 2015. Over the course of 2016, Air Serbia ran 33,171Alongside the newer
Airbus jets Air Serbia
decided to utilise four
of the best-condition
Boeing 737-300s it
inherited from Jat
Airways under the
Aviolet charter brand.
I B T • As part of the
rebranding the Jat
Airways f leet was
repainted with new
titling on the fuselage
and three dots on
the tail. ATR-72
YU-ALO remains
in service today with
Air Serbia.
N H A • Following
in estment from
Etihad the airline
was rebranded as
Air Serbia and the
f irst of ten Airbus
A319/320s ar rived
in 2013. YU-APC is
named after legendary
Serbian tennis player
No ak Djokovic.
N H 90 AIRLINER Classics 2018
AIR Serbia made history
on May 10, 2017 with an
A320 airliner operated with
an entirely female f light and
cabin crew...