"Jat Airways" cuts number of employees by 550 - Plan for recovery of national airliner presented

- Serbian air transportation company "Jat Airways" plans to cut the number of employees by 550 prior to the end of the year, to about 1,000 workers - Srđan Radovanović, the Director General of that national company, announced today (October 22, 2009).

Presenting the Plan for recovery of "Jat Airways" at the press conference, he said that the number of employees in the company would be reduced through separation of commercial aviation and flying academy, reorganization, reduction of administration, and employment of young flying staff.

Radovanović said that the Plan anticipated that the company would operate without losses in 2010, and that it must register 150m EUR worth of incomes, that is, transport 1.5m passengers by using 16 airplanes, in order to make that possible.

- The losses of "Jat Airways" in the first nine months of this year amounted to 11m EUR - said he and added that the company's losses were expected to stay below 20m EUR by the end of the year.

Radovanović reminded that the business losses of "Jat Airways" in 2008 had amounted to about 30m EUR, and that the company's overall losses, including financial losses, had reached 80m EUR.

Recovery of the company, as he explained, anticipates beginning of modernization of JAT's fleet of 16 airplanes, that is, rental of newer aircrafts following the expiration of leasing period for four airplanes.

- The Government of Serbia will give "Jat Airways" the guarantee for the loan of 40m EUR - said Radovanović and added that that money would be used for rental of "boeing 737-700" instead of "boeing 737-400", since the former can fly to the Near East without a stop.

As he explained, the plan is that 23m USD, which are given as the deposit for the 1998 contract on purchase of eight airplanes, be used for procurement of one smaller aircraft.

- The agreement on that has not been reached with company "Airbus" - said Radovanović, but he added that the people in that European airplane manufacturer "are willing to negotiate" and that "they just don't wish to return the deposit".

"Jat Airways" is not going to purchase new airplanes, as he pointed out, until the company's profit reaches 10m EUR per year.

The Director General of "Jat Airways" said that the Government of Serbia had allowed that airliner to sell its business building in Belgrade and some of the properties, and that the 20m EUR worth of incomes from that would be used for the repair of nine jet engines.

Within the scope of the plan for increase in number of transported passengers to 1.5m per year, "Jat Airways" plans to start flying from airports in Skopje and Banjaluka in spring 2010.

The plan is that "Jat Airways" gets license for flights from Skopje through its dependent company in Macedonia - "Aeromak". In that way, JAT would take over 240,000 passengers that used to fly with bankrupted Macedonian airliner MAT.

As Radovanović explained, "Jat Airways" will start giving away free taxi ride from the Belgrade airport and full health insurance for the countries of European Union with the flying ticket at the beginning of year 2010.

- "Jat Airways" plans to join one of European aviation alliances prior to year 2011 - said he.

Radovanović added that the representatives of "Jat Airways" had spoken about that to the representatives of "Sky team", led by "Air France", and that they would talk with "Star alliance", led by "Lufthansa", next month.

He announced that "Jat Airways" would also renew the code-share contract on joint flights with "Lufthansa".

The Director General of "Jat Airways", Srđan Radovanović, estimated that it would be good for that air transportation company to find strategic partner by the model agreed between the Government of Serbia and Italian "Fiat" for Kragujevac-based automobile factory "Zastava".