S7 Airlines Domestic Traffic Growth Slows to 3.9% in January

Russia’s largest private airline group, S7 Airlines, experienced a 6.7 per cent traffic improvement in January 2019 compared to the same month last year, Rusaviainsider reported. The two airlines that make up the group – Sibir and Globus Airlines, both of which operate under their brand name S7 Airlines – collectively carried some 1.17 million passengers in the month, the company said.

S7 is the country’s second largest passenger carrier after national flag carrier Aeroflot. The group’s international segment picked up by 13.6 per cent whilst its domestic traffic growth slowed down to 3.9 per cent. This is its lowest January growth rate in the last four years and is close to the growth registered on international routes in 2016, a year characterized by an overall decline in the Russian air travel market, unlike the current market situation. In January 2019 aviation authority Rosaviatsiya reported an 8.8 per cent improvement of all Russian airlines’ combined operational results.

Meanwhile, another Russian airline, Aeroflot Group’s low-cost subsidiary Pobeda Airlines, reported that its net profits for 2018 decreased by 43 per cent to 2.013 billion roubles ($31 million), even though its revenue climbed by 75 per cent to 35.533 billion roubles ($547 million), according to Russian Accounting Standards.

“Two fingers would be enough to count the number of [Russian] airlines that reached profitability in 2018, in a year with an unprecedented surge in fuel prices,” said a Pobeda spokesman. “The average fuel price at the airports across [our route] network grew by 37 per cent over the 2017 average. Along with that, the airline also managed to cut its other expenses by increasing aircraft utilisation, implementing new technologies, whilst improving labour efficiency. All this helped [us] close the year with more than two billion roubles of profit.”

Last year, Pobeda, Russia’s only low-cost (LLC) airline, carried 7.184 million passengers, a sparkling 55 per cent improvement on 2017’s numbers.