Despite of the strong competition in all our markets and record high fuel cost, we have continued to grow, opening new routes both from Vilnius and from Riga. Starting 4th December, we will start a new route from Riga to Tashkent in Uzbekistan, in cooperation with Uzbekistan Airways. This will be our first flight to Central Asia. Uzbekistan is a large and important country, and also an exciting holiday destination – is well worth a trip. Spring next year we will open a new route to Almaty in Kazakhstan. The cost of fuel is rising at an alarming rate. Many airlines are currently either raising already existing fuel surcharges, or introducing new ones. We in airBaltic will not follow this praxis. A fuel surcharge for me is nothing but a hidden fare increase – and for the time being I see no need to generally increase our fares. In order to maintain existing fare levels, or even to decrease them, we will continue to work with making our operations more efficient. Just to give you an idea about the importance of fuel prices for an airline like airBaltic: the relative share of fuel to total costs could increase from today’s 30% to over 40% in 2008. It will be no easy task for us to cover these 10%. Miracles happen in sagas, not in business life. airBaltic will not increase fares. Instead, we will introduce a charge for passengers who check-in their luggage. Many airlines have already done so. Starting in December, we will charge 3 LVL (5 EURO) for every piece of checked luggage. You could say that also this increases fares – but, checked luggage increases airport handling costs, and we charge only those passengers who actually use the service. Hence, part of our handling costs, check-in and transport of luggage, is simply passed on to those passenger directly affected. Maybe some of you will not agree with this set-up, or find it unfair. Still, I find it is a far better solution to charge for a specific service than to simply increase fares for everybody. I trust you understand my reasoning. Merry Christmas and Happy New Year! Bertolt Flick
President and CEO |
