CSA Czech Airlines is to enter the low-cost sector by purchasing Prague-based charter carrier Travel Service Airlines.
A deal would see the airlines kept separate, with Travel Service becoming a 100%-owned subsidiary offering charter and low-cost services under a new brand name. Travel Service is owned by travel agencies Cedok and Canaria, and CSA would develop a strategic partnership with both companies, as well as other tour operators and travel agencies.
The Czech Republic is to join the European Union in May 2004, when it will become part of the European single aviation area. This is likely to increase competition at Prague.
CSA considered becoming a low-cost carrier a few years ago under the control of former president Miroslav Kula, who was forced out in September this year.
CSA says the purchase would help it increase labour productivity, which has lagged behind most west European carriers, as the carrier will use internal resources rather than add employees.
Source: Airline Business
