MURDO MORRISON/ LONDON
Baltic airline rethinks regional jet ambitions to fuel improving growth in Eastern Europe
Estonian Air will select a 50-seat regional jet type by the end of the year to replace its two leased Fokker 50 turboprops on its shorter-haul routes as it gears up for full privatisation and an expected surge in business and tourist traffic.
The Tallinn-based airline, in which Denmark's Maersk Air has a 49% stake and management control, is predicting a two thirds annual increase in passengers to 500,000 over the next five years as the economies of the former Soviet Union rebuild after their late-1990s collapse, says president Jorn Eriksen.
Shockwaves from Russia's economic crisis hit Estonian Air's plans to update its fleet last year. "At the end of 1999 we had to take stock and re-evaluate our business plan which would have seen an earlier transition to regional jets, and we extended the leases on the Fokkers," says Eriksen.
Estonian Air operates the two Fokker 50s along with two leased Boeing 737-500s. In 1999 the airline originally selected Bombardier CRJ200s for the fleet update. Now the Embraer ERJ-145 and CRJ200 are under study, with the aim of two examples being in service by next summer. Eriksen says Maersk's all-Bombardier regional jet fleet "might affect our decision. We are looking at other opportunities that might fit better with our needs."
Maersk has heavily rationalised Estonian's fleet and route network and phased out 10 inherited Russian aircraft. Eriksen says further expansion could be on the cards once the leases on its 737s run out in 2004.
Estonian expects to make its first profit this year since being part-privatised in 1996. The Estonian Government is drawing up plans to sell the 34% of the airline it still owns by the end of 2001.
Meanwhile, Finnair, Estonian Air's biggest competitor in Tallinn, plans to spin off its Baltic operation into a new business, Aero Airlines, which the flag carrier hopes will eventually take over its regional turboprop services in Finland and Scandinavia. Aero Airlines, which will be 51% owned by an Estonian investment company, is set to take over Finnair's six daily flights to Tallinn from October.
Source: Flight International
