Airports: All right, but under the same terms as everyone else, we will not lower fees or pay commercials
Head of scheduling at Ryanair Niall O'Connor recently informed Croatian Minister of Tourism Gari Cappelli at the World Travel Market (WTM) fair in London about starting new flights to Zadar and expressed interest in starting flights to Zagreb and Split.
Ryanair operates flights to Zadar, Rijeka and Pula, and the company wants to expand the list with two large cities in Croatia. The company has been trying to arrange flights to Dubrovnik, Split and Zagreb for years, but airport management rejected the proposals due to the Irish company's business concept. Ministry of Tourism confirmed that Minister Cappelli held a meeting with O'Connor and added that it is interested in Ryanair's proposal. It commended new flights to Zadar and promised to arrange meetings with managements of airports.
Co-financing
It added that the HTZ launches competitions each year for implementation of strategic promotional campaigns on foreign markets. The HTZ is co-financing ads for Croatian tourism in pre- and post-season, and the offer stands for airlines as well. Some HRK 30 million was spent this way last year. However, since the competition for co-financing next year is closed, Ryanair can respond to the competition for 2020. The Ministry and HTZ's goal is bringing in more tourists outside the summer season, when Croatian airports and accommodation capacities are full. This is why the Ministry of Tourism started the plan for developing Croatia as an airline destination - only about 3% of tourists fly to Croatia.
HTZ Zagreb would like to see Ryanair among other low cost companies flying to Zagreb. "That would help Zagreb position itself as a city break destination and make it more accessible to many tourists." In its answer, the HTZ stressed that it has not discussed the plan with Ryanair or the Zagreb Airport (MZLZ), but noted that it would like to find a mutually acceptable model for Ryanair's flights to Zagreb. However, the question is whether Ryanair's business model is in line with desires of airports in Zagreb and Split.
Ryanair Sun made 17 charter flights from Warsaw to Split last season for a tour operator. As for the company's announcement for next year, Split Airport director Lukša Novak could not confirm or dismiss the possibility of Ryanair operating in Split next year, pointing out that the Airport is currently preparing schedules for next year. "Considering our experiences, we can confirm something like this only after schedules have been set. We are currently not able to do that."
Discount
"As far as the Split Airport goes, all companies, both low cost and standard, are offered the same terms. These terms are transparent. Their treatment depends on number of flights and passengers," said Lukša Novak. In other words, he noted that Ryanair cannot count on special treatment at Split Airport, which the company usually demands. This includes discount on airport fees that air carriers pay per passenger, which are set depending on number of flights, passengers and more. However, our sources claim that Ryanair usually pays between EUR 2 and 5 per passenger, depending on airport, which is significantly lower compared to how much other air carriers pay. For comparison, the fee per foreign passenger stands at EUR 17 at the MZLZ. The second privilege that Ryanair always demands is subsidizing of its flights through joint advertizing models. This means that the local community, including the Tourist Board and the airport, pays a specified sum to Ryanair for advertizing the destination on its website. In the case of Zadar, the figure stands at some EUR 12 million annually, while in Rijeka and Pula it is significantly lower. Ryanair decides how much. This policy allows Ryanair to offer significantly lower prices and push out other airlines from airports. The Split Airport is overbooked in the summer and has no interest in providing special treatment for the Irish company. The Airport could be interested in a deal for the winter season, but Ryanair might not be interested in that.
Zagreb's case: low cost companies can use the old building at Pleso Airport
The Zagreb Airport is in a specific situation. Unlike other international airports in Croatia, it is managed by private owners through a concession model, so the State does not have much room for imposing its will even if it wanted to. The Zagreb Tourist Board claims that "there is possibility for cooperation through strategic projects we are developing in cooperation with the HTZ where promotional activities of airlines are co-financed through advertizing of Zagreb as a destination." However, in the case of Ryanair, this is just a small portion of what is required. Asked about the possibility of Ryanair coming to the MZLZ, they said "we are talking with different airlines about possible new flights from Zagreb. Ryanair has not sent an official request for negotiations on its operation in Zagreb, but we are certainly open to such talks."
As far as low cost airlines go, only Eurowings operates in MZLZ, and the management would like to attract more low cost airlines, but is not willing to lower fees. MZLZ head Jacques Feron recently revealed that the Airport is looking to attract more low cost airlines, but stressed that his could only be possible if the State lowers annual concession fee. Unnamed sources expressed belief that the French concessionaire is not interested in attracting low cost airlines that would operate throughout the year. In that case, number of passengers served could quickly increase to more than 5 million annually, which would force the concessionaire to expand the Airport. On the other hand, the Ministry of Tourism is in favor of brining in as many low cost airlines as possible to Zagreb. Unnamed sources pointed out that it would be best to use the old building at the MZLZ for such companies. The building has been empty for years and concessionaire managing it has not decided what to do with it. Something similar was implemented in Sofia.
Unnamed sources claim that the MZLZ has to decide on Ryanair soon as the company is expanding to smaller airports relatively close to Zagreb.