Losses of $1m for Kryghizstan national carrier due to unprofitable domestic routes

Published: 12/2/1999

Timur Muratov, President of Kyrghizstan Aba Zholdoru (KAZh), the Kyrghizstan national airline, has announced losses for the airline amounting to Som 32m ($1m) for the nine month period ending 30th September 1999. Passenger traffic totalled 125,111 over the period. Muratov attributes the losses primarily to unprofitable domestic routes. Despite very low tariffs on domestic routes, the airline carried 42% fewer passengers on domestic routes than in the first nine months of 1998. Costs have also increased owing to significant hikes in air navigation charges abroad. Most of the revenues are derived from international routes. Manas Airport in Bishkek doubled its revenues over the period. KAZh performs regular and charter routes to Russia (Moscow), Tajikistan (Dushanbe), Germany, China, UAE, India, Italy and Pakistan. Due to low load factors, it cancelled flights to Baku (Azerbaijan) and Namangan (Uzbekistan) and stopped operating the Bishkek - St. Petersburg route. Founded in 1991, KAZh is 90% state-owned. Its fleet comprises one An-28, six Mi-8s, four Mi-8MTW-1s, 11 Yak-40s, one An-26B, nine Tu-154B1s, sevenTu-154B2s, two Tu-154M and one Il-76TD. Last month, it was reported that the Malaysian property development company, Safuan Group Berhad, had entered into an agreement with KAZh to create a new international airline, based in Bishkek (www.concise.org. 11th November 1999). This would provide an injection of $4m to help launch new air routes and fund two A-310s. It has also recently signed a cooperative agreement with Aeroflot (www.concise.org. 24th November 1999). The airline"s efforts to improve its situation should be worth watching.

Article ID: 1159