Adria Airways Collapse Looking More Likely By The Day

Adria Airways is facing collapse just three years after privatisation. The national carrier of Slovenia scrapped aircraft orders and cut routes this year. Company executives held a meeting with the country’s Prime Minister last month, at Adria’s request. The airline is in deep financial trouble, reporting a loss of almost six million EUR in 2017.

After numerous flight cancelations last summer and severe flight delays still happening almost daily, Adria’s reputation has suffered an irreparable loss. Now, foreign airlines are increasing their presence in Ljubljana’s Jože Pučnik Airport. They are anticipating the collapse of Adria Airways.

Adria Airways Airbus A319
One of three Adria Airways A319s. Photo: Wikimedia

The Adria Airways strategy

Adria positioned itself as a Lufthansa Group feeder. For many years now it has been flying several daily flights from Ljubljana to Brussels, Frankfurt, Zurich, Vienna and Munich. It is the only country in all of Europe not to have a single flight from any of the Lufthansa Group airlines, not even Eurowings. This demonstrates the strength of Adria’s relationship with Lufthansa.

Since 2010 Adria is also a feeder for Lufthansa in Frankfurt from Tirana, Albania. Furthermore, since 2014 it feeds both Frankfurt and Munich from Priština in Kosovo. And it links its own hub in Ljubljana with both Tirana and Priština, giving local passengers access to other Lufthansa Group hubs like Zurich and Vienna as well.

In October 2018 Adria opened a new “hub” in Paderborn, Germany. From there it flew to Zurich and Vienna, again as a Lufthansa feeder, and to Southend. But all Paderborn operations were abruptly suspended with a single Tweet. Adria was using a wet-leased ATR on its routes from Paderborn, while simultaneously keeping several Saabs parked because it had no pilots to fly them.

Adria Airways and Paderborn Airport could not further agree on the conditions for the airport services agreement under which the flight operations would continue. This, unfortunately, resulted in discontinuing of further operations of Adria Airways from the base in Paderborn.

2018 was disastrous

The whole Paderborn fiasco was a costly adventure, but it was not the only one of Adria’s issues last year. An overly ambitious summer schedule saw Adria launch 7 new routes to Sofia, Geneva, Bucharest, Hamburg, Dusseldorf, Dubrovnik, Brač. Only the Sofia route survived into summer 2019.

The main issue Adria faced last year was a fleet shortage. The airline had scheduled its new flights to be operated with six Saab 2000 aircraft. All six Saabs were to be transferred to Adria Airways from Darwin Airline, its subsidiary that collapsed in 2017.

Adria Airways Saab 2000
Adria Airways acquired six Saab 2000s from Darwin Airline. Photo: Wikimedia

But Swiss public prosecutors then opened criminal proceedings over the suspicious handling of Darwin’s bankruptcy, as reported by the Swiss Broadcasting Corporation. The timing of the bankruptcy was most curious. Adria Airways acquired Darwin Airline from Etihad only four months before the collapse of Darwin that would then see Adria get six of Darwin’s aircraft.

The Saabs finally began arriving to Adria at the end of September 2018, but by that point the airline had already been cancelling numerous flights daily throughout the peak summer months.

The cancelled Sukhoi order

Perhaps the most drastic development for Adria Airways was a failed attempt to secure an order from Russian aircraft manufacturer Sukhoi. Adria ordered 15 SSJ-100 which were due for delivery in April 2019. This would have been yet another aircraft type in Adria’s fleet. This is despite only having 20 aircraft. Adria’s website lists these as 3 A319s, 9 CRJ900s, 2 CRJ700ERs and 6 Saab 2000s.

In conversation with AeroTime News Hub Sukhoi revealed why the deal was cancelled. Apparently, after “responsible financial institutions” examined Adria’s financial report they recommended the cancellation “to prevent possible losses”. Coming from an airline with a questionable safety record, this is a severe indicator that Adria Airways is indeed facing collapse.

Adria Airways Sukhoi
Adria Airways agreed to receive 15 SSJ-100s. Photo: Wikimedia

The bad news surrounding Adria still keeps coming. Just last month the Prime Minister of Slovenia met with the executives of Adria Airways, at the airline’s request. Siol reported the contents of the conversation, calling it “proof that the company is in great trouble”. One of the revelations made by Siol was that Adria’s CEO asked the government to acquire funds for them from the European Union.

The Prime Minister later publicly stated he is unsure whether the airline will be flying for much longer. He called Adria Airways a “bad example of privatisation”.

Adria Airways operations are still in chaos

Adria continues to operate unreliably. Over the last few days, the airline had several flight cancellations despite only operating about 25 daily flights from Ljubljana. On Tuesday 11th June, Adria cancelled flights to Priština and Prague. The afternoon flight to Frankfurt was four hours late. On Monday its Copenhagen flight was six hours late. On Wednesday it cancelled flights to Munich, Prague, Zurich and Tirana.

For several days now, Adria has been wet leasing a Carpatair Fokker 100 to cover other operations from Ljubljana that would otherwise be cancelled. It is also wet leasing another F100 from Trade Air, for its flights from Priština and Tirana. These short-term leases and the compensation payouts from all the cancelled flights are costs that are incrementally moving Adria Airways towards collapse.

Foreign carriers are taking over Ljubljana

Meanwhile, foreign carriers are slowly increasing their presence in Slovenia. LOT Polish Airlines launched flights between Warsaw and Ljubljana in March 2016. Adria had been serving the route since April 2014 but could not compete with LOT. In November 2018 Adria gave up on the route.

The same month, Adria then discontinued flights to Moscow which it had been operating continuously since November 1990. Aeroflot launched daily Moscow to Ljubljana flights in October 2018, causing Adria to terminate its own service to Moscow in February 2019.

The same fate now awaits Adria’s route to Paris CDG. Air France, which flies to Ljubljana six times weekly, terminated its code share agreement with Adria on this route this year. It will also be increasing weekly frequencies from six to 13. This move is clearly designed to kill off Adria on the Paris-Ljubljana route.

With Adria’s diminishing market share and a deteriorating reputation, will Slovenia even wish to prevent its collapse?