If low-cost airlines come to Yerevan, I would question the future of Gyumri Shirak Airport - Marcelo Wende

Head of the Civil Aviation Committee Tatevik Revazyan said in recent comments that the Armenian market is of interest to low-cost airlines. For clarifications on the plans to bring those companies to the country, to lift the state exit duty on international flights, as well as the future of Gyumir Shirak Airport, Tert.am has interviewed Marcelo Wende, the General Manager of Armenia International Airports.

Several days ago, Head of the Civil Aviation Committee Tatevik Revazyan revealed low-cost airlines’ interest in the Armenian market, suggesting plans to remove the state exit duty of AMD 10.000, as well as reduce the service prices at Zvartnots Airport as possible measures to attract them.

The removal of AMD 10.000 is the best thing that can happen in the aviation market. It has been already 10 years that we are asking to do that, and if it becomes possible, both we and the air companies and passengers will be very glad, too. It is obvious that the airport is very interested in bringing new air companies, including low cots airlines, to the Armenian market.

 The state exit duty of AMD 10.000 does not applyt to Gyumri Shirak Airport. What is currently happening at the airport, and what are your plans?

Three years ago, we had zero passenger flow at Shirak Airport. In order to attract the low cost airlines, the Armenian Government decided to remove the state exit duty of AMD 10.000, and we reduced our tariffs by 75%. After this tremendous incentive, the first low-cost airline Pobeda entered the market and we managed to bring the passenger flow to about 200 thousand in two years. Simultaneously, we started to renovate the entire infrastructure of Shirak Airport which was already obsolete. Over the past two years, we have invested USD 4 million and plan to invest 5 million more in the two years to come. As a result, the total investments over the past eight years will comprise USD 20 million. We expect that due to our endeavors, more low cost airlines will come and operate to and from Gyumri Airport which will boost the development of the region and, of course, the economy of Gyumri city.

If low-cost airlines start operating flights to Zvartnots Airport, what will be the situation in Shirak Airport then?

As I already mentioned, Shirak Airport was launched for bringing low-cost airlines and developing the region. This is a concept that works in the whole world, i.e. - the low-cost airlines fly to the secondary airports. The best example is Kutaisi Airport; the same is happening in many European countries. If low cost-airlines will come to Yerevan and provide them the big incentives that they usually require, I would surely question the future of Gyumri Airport.

Prime Minister Nikol Pashinyan recently stated our objective and desire to have Armenian companies on the aviation market. What is your opinion on that kind of proposal?

Any good decision for boosting the air transportation will always have our support. We are in contact with possible investors and, as the management of the airport, we are ready to provide strong support for any reasonable initiative. Armenia has good pilots, engineers, stewards that are currently working in different countries and we will be glad to bring them to Armenia and give the possibility to grow in their own country.

How can you support?

As local air companies they can always enjoy benefits when basing their aircrafts. We are in active contact with them, and the negotiations are going in the positive direction.  I do not want to go into detail, but I can assure that we will never be an obstacle for the development of the local air companies; moreover, we will become their best partner.

Do you thinl the simultaneous operation of Armenian and low-cost airlines will be feasible at Zvartnots Airport?

This is a good question; maybe you can address it to the local air companies. I personally do not think that any local company can survive in this scenario.

The prices at Zvartnots Airport are very often claimed to be high. What is the reality? Are they high indeed?

The issue about the tariffs is common everywhere. Air companies all over the world always complain, and everyone is always repeating the same statement. But if someone takes the effort and goes to the other airports of the region and compares the tariffs of our airport with the tariffs of another airport with the same passenger capacity, he can see that we are on the same level, even cheaper. Of course the exit duty of AMD 10.000 is added on the top of them and departing from Zvartnots Airport becomes more expensive by 40%.

 Why is it universally claimed that the ticket prices are high?

This is another tricky issue. If we go back for six years when Armavia was performing flights to Moscow and different Russian destinations, the round trip ticket price was $500-$600. No open sky policy was declared at the time, and eight to nine flights daily were performed to Moscow.  Today it is possible to purchase a ticket for Moscow for USD 200 and even a cheaper price. Do you still consider it expensive? Nowadays, we have 20 daily flights to Moscow. This free competition makes the tickets even cheaper, and if we mention the Pobeda flights from Shirak, the ticket prices will be much cheaper.

As regards the European market here the issue is a bit more complicated; that is why we think that any development, i.e. - local air company/low cost airline, can help. Nevertheless, this situation is very common everywhere, and if someone wants to travel in high season, it is difficult to find cheap tickets. During April we published the prices for the air tickets to different destinations, and they were quite reasonable. We recommend everyone to try to make the bookings beforehand.

What statistical data do you possess for Zvartnots Airport? What was the passenger flow last year, and what passenger flow is forecast for this year?  What is the capacity of airport facilities for handling passengers?

In 2018, we handled 2.690.000 passengers. If everything goes on like this, we plan to conclude the year 2019 with 3 million passengers. This comprises a 55% increase for the last four years, which is quite an impressive result that shows the aviation market is on the right track. We are having active negotiations with different air companies for the summer 2020 so as to increase the number of flights, destinations and frequencies. The capacity of the boarding area is about 3.5 million passengers; we are currently working on the extension project and expect to present it to the Government in a couple of months. Once we have the approval of the Government we will move forward. We aim at building an airport that will be able to handle 10 million passengers per year.