A Mixed Year for Montenegro Airlines

2010 was a mixed year for Montenegro Airlines. The airline failed in to achieve privatization and lost six million Euros of taxpayer money, but at the same time it also increased the number of passengers it carried by 20% — to 630,000. The airline also increased the number of flights by 16% in 2010.
CEO Zoran Djuriši? blamed rising fuel costs on the airlines losses. Clearly the answers to rising fuel costs must include rising ticket prices, or the Montenegrin taxpayers will be forced to continue to subsidize air travel. With a six million Euro loss on 630,000 tickets, it is pretty easy to see that the airline is losing around nine Euros on each passenger.  With an average ticket price of 93 Euros, this will mean an approximately 10% increase in ticket prices.

One alternative is to reduce the number of flights, particular unprofitable flights.  Montenegro Airlines will soon add flights to Milan and Brussels — hopefully these new flights will be profitable for the airline.

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