Can Cyprus Airways save itself? Editorial

Financial Mirror

For several months now the island’s main carrier, Cyprus Airways, has been on the defensive, reacting to challenges from other airlines, but with no clear forward-thinking strategy of its own.
It all started in December when CAIR slashed return fares from the UK by about 100 pounds, trying to fend off the competition from prime rival British Airways, as well as regional and charter operators such as Monarch and Flyglobespan. Then came the threat from easyJet that multiplied its schedule to Cyprus by adding flights to Larnaca, beyond the near-capacity operation to Paphos.
CAIR’s biggest money-earner is also at risk as Aegean has grown up from a young upstart and has matured into a fully-fledged operator, hoping to become the leading airline between Cyprus and Greece. Other fledgling airlines are also eyeing Cyprus, while the new owners at Olympic will probably embark on a major drive to win back lost business, taking as much from Cyprus Airways along the way.
The national carrier was forced to reconsider its plans to scrap the loss-making Larnaca-Paphos-Athens flight after Aegean said it was increasing the number of its weekly flights and started a new service to Paphos. Cyprus Airways countered with an offer of 134 euros to Athens for 4,500 seats, but these quickly sold out.
CAIR has recently announced further knee-jerk reactions to major competitors, with the latest being the 260-euro offer to Dubai, at a time when Emirates sold out a once-time offer to Malta for 200 euros, including air fare, taxes and accommodation.
However, for some obscure reason, it is happy to keep the loss-making Beirut service afloat, whereas it could even increase its earnings by putting on smaller aircraft, lowering the air fare and cutting the costly overnight stay of its crews.
Though the airline’s books seem to be in the black for now, not responding to the great demand of its most loyal customers could spell its final demise.
The main problem with the airline’s management is that it may introduce cut-rate offers to beat the competition, but it does not follow through, resulting in passengers swinging from one airline to the other.
Offers are also limited in number to no more than 15 seats per flights, which is why offers are taken up so fast, with management often denying rumours that staffers with the know grab them first. This obviously annoys customers to switch their allegiance to rival operators and deters others from considering short breaks rather than stay home.
It is also unjustifiable that other airlines (Austrian, Lufthansa) are taking the lion’s share of travel to Brussels, at a time when Cyprus Airways, too, flies to the EU capital.
Unless, of course, the plan is to finally run it into the ground, only to be “saved” by a handful of investors who have been eyeing a takeover for some time.

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