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Company News

25 November 2005

Aeroflot to Support the Appeal of Russian Association of Air Transport Operators

November 25, 2005 – JSC "Aeroflot – Russian Airlines" supports the appeal of the Board of Russian Association of Air Transport Operators (RAEVT) to the Government of Russian Federation in connection with anxious situation occurred in air transportation business.

According the opinion of the Association’s Board Members many years of protectionism policy measures with regard to production activities of Russian aviation industry have not proved their effectiveness, but instead acted as a break on development of the entire aviation transport industry. Within the last two years it led to dramatic continuing decline in a volume of transportation as well as enormous growth of production expenses and rates. Practically that means destabilization of the economy of aviation companies which if relevant measures are not taken would become irreversible.

At the meantime having loosing the mass passenger the industry is gradually getting the status of elite kind of transport and is about to fall down into deep crisis.

The major reasons conditioning such a sad result are avalanching growth of price on aviation fuel, increase of aircraft operation expenses and economic barriers which do not allow effective renewal of domestic aircraft fleet with less fuel consuming foreign made analogues.

The above reasons conduce to the situation when all independent efforts of local air carriers aimed to lead the industry out of the crisis by reducing the expenses do not give tangible results. This happens mainly because the owners of domestic made aircraft cannot compete with those having in possession less fuel consuming aircraft in terms of flight maintenance costs and in respect of some other criteria of aircraft park maintenance. Redundant operation expensiveness of existing technique places Russian air carriers in inadequate competitive position in comparison with foreign ones and significantly reduces their competitiveness.

The Board of RAEVT stresses that to overcome the crisis Russian air companies should be enabled to renew their aircraft fleet with modern aviation technique independently of country of its origin, certification and registration, and in this way all the hampering barriers including customs ones should be eliminated.

According to the opinion of the Board of RAEVT it is necessary on a temporary basis (for the period of up to one year) to impose a moratorium on the growth of prices, rates and duties for airport and navigation service as well as to take urgent measures on decreasing and stabilizing of prices on aviation fuel. In addition to that there are other measures to be taken with regard to improvement of antimonopoly and tax legislation. All above measures should have one and the same purpose, i.e. establishing of normal competitive conditions on the aviation transportation market.

Russian Association of Air Transport Operators (RAEVT) is founded in October 1991. The Association incorporates 12 committees and councils in charge of different aspect of Association’s activity. Association unites 36 members – aviation companies. RAEVT is established with the purpose of concentration of air carriers efforts in developing and implementing of uniform policy in a field of civil aviation.

President of RAEVT – Yevgeniy Tchibiryev.

Chief of the Board RAEVT – Andrey Martirosov.