Regional Market CIS
Lufthansa Consulting was one of the first international aviation consulting companies to work in the CIS region right from the start. Since 1992 until today we have been fully committed to supporting all aviation and transportation stakeholders such as airports, airlines, governments, financial institutions as well as investors.
You benefit from state-of-the-art solutions and a committed new team for CIS and South East Europe. We are eager to invest our expertise and energy to help your company and to develop these regions.
Communication is a key success factor for efficient projects which lead to exceptional results. We specifically employ Russian native speakers as part of our core staff and involve them in projects in the CIS region, wherever appropriate.
Please contact me, Stanislav Solomko, Associate Partner, or my colleague Askhat Torshin, we are both permanent representative for CIS (Russian native speaker) to discuss your venture.
The event is annually held in Moscow and dedicated entirely to cover the issues of aviation finance, aircraft and engine lease and fleet modernization for the Russian & CIS airlines. This year is in total the 9th international conference and it takes place at the InterContinental Moscow Tverskaya Hotel.
In 2016, more than 180 representatives of aviation, finance, banking and business spheres took part in the conference to discuss crucial questions in aircraft finance and lease. The conference agenda reflects the latest trends of the air transport industry in Russia, which is currently undergoing a major transformation.
Lufthansa Consulting gives its sponsorship support to the event and Associate Partner and Head of Market Russia & CIS Stanislav Solomko as well as Associate Consultant Alexander Saprankov will hold a speech.
The security screening experience at airports remains a high-ranking pain point for air passengers as confirmed by recent surveys such as IATA’s Passenger Survey 2016. The limitations in passenger terminal throughput and operational efficiency negatively impact service levels and journey experience mainly due to the overall perceived uncertainty, waiting and queueing times, duration and procedures of the control process itself and the checkpoint environment.
At airports around the globe stakeholders have initiated activities to improve processes, inspired by concepts put forward by the air transport industry’s associations IATA and ACI. The aim is to deliver improvements and satisfy passengers’ preferences. The most significant issues concern the preparation process (removal of belt, jacket, shoes, electronic devices), the simplification and consistency of the screening process and the multiple security checks required throughout journeys involving a connection.
What are the success drivers and key challenges in implementing the various measures and projects, whether minor adjustments of operating procedures or adaptations to the terminal building’s layout or infrastructure?
A concept development and implementation requires collaboration and buy-in of all parties at the respective local airport and state level. Effective passenger terminal operations enhance the passenger experience, therefore leading airlines are widely engaged in facilitating improvements at airports in their networks. In order to specify an action plan and deliver smart solutions it is essential to integrate both airline and airport perspectives from both the operational and commercial points of view.
The experience gained at Lufthansa Group hubs as well as at many of its destination airports can be applied to capacity-constrained capital and regional airports in other areas. Lufthansa Consulting supports your ideas or initiated efforts to optimize your terminal infrastructure and meet your airport’s strategic goals.
Our experts help you to develop or fine-tune your plans to streamline and simplify the security control of passengers and baggage in a technology-enabled, digitalized environment to achieve a successful overall passenger-empowered airport experience.
Contact us to discuss critical factors for successful delivery and related challenges facing airlines and airport operators.
This year, the 14th Eurasian air transport forum will take place at the Renaissance Monarch Centre in Moscow from 1st to 2nd November.
Due to the development of the Eurasian aviation as well as global air transport, Wings of the Future 2016 is dedicated to become a place where all kind of aviation experts will have the opportunity to discuss and share their opinion of upcoming changes. Among others, the Eurasian development trends as well as the evaluation of airline business models are included in the great variety of this year’s key topics.
Meet Associate Partner Stanislav Solomko, responsible for the Russian and CIS market, Associate Consultant Alexander Saprankov and Anna Shachikova.
The Moscow International Forum for Innovative Development “Open Innovations” will take place at the Skolkovo Technopark in Moscow, Russia.
The two-day conference is an annual forum with the dedication to new technologies and prospects for international cooperation in the field of innovation. Their major objective is the exchange of practical experience, the promotion of leading research studies and development projects and the creation of new mechanisms of international cooperation in the field of innovation.
Bruno Boucher, Associate Partner and Head of Africa West, Central and North will hold a speech about Unmanned Aerial Vehicles (UAV). Furthermore participants have the opportunity to meet Dr. Andreas Jahnke, Managing Director, with Stanislav Solomko, Associate Partner responsible for the Russian and CIS market and Senior Consultant Mikhail Andriyanov.
The Estonian newspaper Eesti Päevaleht conducted an interview with Mr. Stanislav Solomko, Associate Partner and Head of the Markets Russia, CIS, and Baltic States regarding Lufthansa Consulting’s project for Nordica. Read the translated interview below:
The Ministry of Economic Affairs and Communications commissioned an expert opinion from your company, and your general assessment of the business plan of Nordica was positive. Please tell us how you came to this conclusion.
First of all, let’s take a few steps back. Airlines depend on passengers, i.e. clients, just like all other businesses. Air passengers can broadly be divided into two groups: those who are interested in the lowest possible price; and those who travel, for example, between Tallinn and Stockholm every day. The latter are clients who are prepared to pay more for the service they need. Passengers who’ll pay more are the most important ones in regional aviation, which is to say the business model Nordica follows, because no regional airline can compete with Ryanair or Wizz Air in terms of price.
Look at Ryanair: they started out with 11 routes from Tallinn, but if I’m not mistaken they now only have three. That shows that budget airlines don’t work in every region. The Stockholm route is the best example of where Ryanair failed. It wasn’t their business model to fly there three times a day; much less often. But that was Estonian Air’s niche: attracting clients who pay well, like bankers and senior managers – anyone who’s interested in a convenient flight schedule.
This is where Estonia’s new airline, Nordica, should also succeed if they manage themselves properly. I’m pretty sure they will, since Estonian Air was already one of the most cost-effective airlines in Europe. The decision of the European Commission that brought its activities to an end was an unfortunate one. So if Nordica manages to keep its costs under control and focuses on the right segment, they’ll be a success.
I’m not an aviation expert, but it seems to me that most Estonian air passengers look for the lowest price. I’m inclined to think we don’t have that many well-paying clients. Am I wrong?
Well-paying clients fly more, so keeping hold of them is vital. It’s important to note here that a well-paying client doesn’t automatically mean a client who flies in business class. It means anyone who’s ready to pay 50 or 60 euros for a ticket instead of 20 euros for a budget airline, so at least premium-class passengers. Ryanair can be used as an example here again. They only flew to Stockholm three times a week, but one in every three clients wants to fly back on the Stockholm-Tallinn route that same day. That’s why Estonian Air’s schedule, which had three flights a day, was better, and beat Ryanair.
How should Estonian Air have been managed to avoid bankruptcy?
Sure, the Commissions’ decision was lawful, but it’s sad the airline had to pay such a high price. There was no money for the expansion plans made in 2011-2012, but the investment made sense. True, it was very risky. As tends to be the case in business, investments don’t always pay off in the first few years, and Estonian Air’s shareholder – the state – wasn’t prepared for it. Making big investments only pays off fast if the company’s shareholder is rich or the state has oil. Take Qatar, for example, whose airline still isn’t making a profit, but it’s expanded strongly. Their economy’s growing as a result and the country’s on the map as a travel destination. When we look at an airline based solely on its financial indicators, we see one picture. But when we add the benefit to the state, we see the bigger picture, which is a lot more positive.
Both Estonia and Lithuania have seen their airlines go bankrupt. Only Latvia’s done better. Should the Baltic States have one joint airline?
The scope of a larger company would obviously be broader, and by that logic one large company would make more economic sense. But if you look at SAS, which has tried to follow a similar model, their results haven’t been great, as you know. They’re constantly struggling with financial issues. What this means is that making such a model work is complicated. Lithuania’s problem is that the passengers there look for cheap tickets, not suitable schedules. That of course gives budget airlines the advantage. It’s a different story with Latvia and airBaltic. Their expansion was a success because they weren’t as dependent on state aid as Estonian Air. The Latvians also have enough well-paying clients, and lots of routes to Western and Eastern Europe. It’s true that the poor economic status of Russia is also has an impact on Latvia and forcing airBaltic to review its routes. Establishing a joint airline is also complicated by the fact that both Tallinn and Rīga want to be hubs. It certainly wouldn’t work like that.
To read the original version of the published interview, please click here.
An expansion plan grounded in reality and operations trimmed for efficiency: managing the growth is as important as realizing the potential for it.
To meet the projected capacity of 14 – 18 million annual passengers, a master plan concept defined the strategic development of the airport for the next 20 years. A new terminal and the development of the airfield system were planned. Optimized utilization of the existing facilities of the airport created additional space for the new passenger terminal, air cargo area and aircraft parking stands.
As a reliable basis to evaluate the feasibility of a new airline in Georgia, Lufthansa Consulting carried out a realistic assessment of the air traffic market potential and analyzed the financial viability of the intended start-up.