Armavia (Airline of Armenia) goes bankrupt

[Musso]

This was in the works, and it finally happened. This follows many other airlines in Europe, including airline of Hungary, going bankrupt. Let's see what happens after this, if a new national airline is created or foreign airlines take up the Yerevan market.


Armenian businessmen Mikayel Baghdasarov’s Armavia, the country’s only carrier, declared bankruptcy today and will cease flights starting April 1.

The company founded in 1996 was unable to pay debt accumulated to the Zvartnots airport in Yerevan, Armenia’s capital, and to its contractors, Armavia said in an e-mailed statement today. The total debt was less than $50 million, Baghdasarov told the Arminfo news service on March 15.

Europe’s debt crisis has curbed travel and made governments reluctant to prop up airlines amid the region’s deepest cost cuts in a generation. Hungary’s Malev folded in February 2012, while LOT Polish Airlines SA last week said it needs a “painful” cost-cutting program to stay afloat. Aerosvit, Ukraine’s biggest private airline, entered bankruptcy in December.

Armavia’s owners have been diverting funds from other businesses to fund the airline in the past three years, the company said in its statement.

Armavia has 14 aircraft and was the first operator of Sukhoi’s Superjet 100.

http://www.businessweek.com/news/2013-03-29/armenian-national-airline-armavia-goes-bankrupt-grounds-flights

RIP....
http://www.copypaste.am/wp-content/uploads/2011/08/130906-Armavia-EK32012.jpg

[gregorius]

Im glad armavia went bankrupt

[Musso]

Im glad armavia went bankrupt

me too. they had many problems and weren't a well run airline. I wonder if we will have a new national airline or if we will just let foreign airlines take over the market. I think we should establish a national airline with a robust business strategy, maybe emulating the low-cost airline strategy in European/American markets.

[gregorius]

me too. they had many problems and weren't a well run airline. I wonder if we will have a new national airline or if we will just let foreign airlines take over the market. I think we should establish a national airline with a robust business strategy, maybe emulating the low-cost airline strategy in European/American markets.

My biggest problem is that the tickets where 7 times overpriced, they tried to squeeze everyone because they knew price didnt matter eventually, armenians would come anyway.

[Musso]

My biggest problem is that the tickets where 700 euro, they tried to squeeze everyone because they knew price didnt matter eventually, armenians would come anyway.

prices were ridiculous, and they are not reliable. They always delayed/cancelled because they were in debt to all the airports. I hope Zvartnots implements the open-skies agreement to get more airlines to fly to yerevan.

[gregorius]

prices were ridiculous, and they are not reliable. They always delayed/cancelled because they were in debt to all the airports. I hope Zvartnots implements the open-skies agreement to get more airlines to fly to yerevan.
I remember one time they sold more tickets than there were seats, it was a real mess.

[Musso]

I remember one time they sold more tickets than there were seats, it was a real mess.

lol, not surprising. That's why much better to fly the European airlines. Austrian Airlines is light years ahead of Armavia...

[Grizzly]

I remember one time they sold more tickets than there were seats, it was a real mess.

LOL, sounds alot like the Balkans.

[Xyresic]

Interesting so according to this "Musso" person this is news and can be posted in the Armenian section but Armenian conflict with Azerbaijan can't?

[gregorius]

Interesting so according to this "Musso" person this is news and can be posted in the Armenian section but Armenian conflict with Azerbaijan can't?

Yes this is news , shootings at a conflict zone to one another isnt news because it happens daily.

[Musso]

Interesting so according to this "Musso" person this is news and can be posted in the Armenian section but Armenian conflict with Azerbaijan can't?

Yes this is the national airline of Armenia going bankrupt. That's news. A shooting on the border happens pretty much every day.

[Xyresic]

Armavia's bankruptcy should make Armenia ponder over its state

'Bankruptcy of the national aviation transporter is a strong signal for the leadership of Armenia to ponder over the state the country is caught in'.

Armenia's aggression, its noncompetitiveness and hard economic state, migration of the population from the country raise the isolation of the country from the integration processes in the region and the world.

The statement came from director of the Center for Strategic Studies under the President of Azerbaijan, Farhad Mammadov, 1news.az reports.

The national air company of Armenia has already started the bankruptcy process.

"The company has been working with losses for a long time and its owner Mikhail Bagdasarov was covering these losses from the revenues from other projects. Armavia started functioning in 1996 and its aviation park includes 14 airplanes", the company's news release says.

According to the director, Armavia faced difficulties for a long time.

"These difficulties were mostly associated with two reasons. First of all, the company was unable to overcome the crisis of 2009, when after the assessment of the Armenian dram by over 30% there appeared problems with forfeits on tickets purchase. Second, the interest of the tourists and Armenian diaspora to Armenia has dropped significantly over the past three years", Mammadov said.

The head of the Center for Strategic studies indicated that the number of Armenians' one-way travels has risen which is connected with people's migration from Armenia, as a result of which the activity of the company has become unprofitable.

"The bankruptcy of the national aviation transporter is a strong signal for the leadership of Armenia to ponder over the state the country is caught in. It seems that before the election campaign Sargsyan did not want to spread the negative news which is why it was left for a period after elections", he said.

He reminded that several foreign aviation companies had also cancelled flights to Yerevan.

http://news.az/articles/armenia/78380

[Xyresic]

About 400 employees lose jobs due to Armavia’s bankruptcy

Some 400 employees have lost their jobs after the Armavia airline owned by Mikhail Baghdasarov went bankrupt. The pilots have not received their salaries for the last five months, from November 2012 to March 2013. A pilot told this to “Zhamanak” daily. According to him, at the moment of its bankruptcy, the airline had about 50 pilots whose monthly salaries made 2-3 million AMD.

Besides, the company has not paid salaries of the flight attendants and aviation engineers.

400 employees of Armavia are now jobless. It will soon become clear whether the authorities will find a new company interested in the Armenian aviation market or the circulating rumors will finally become reality and a state-owned airline will be set up.

http://www.aysor.am/en/news/2013/04/03/zhamanak2/

[Musso]

A new national airline (most likely government owned) will be formed. The biggest mistake was letting the national airline be entirely controlled in the private sphere. A national airline is imperative.