Air Serbia eyes return to in-house catering, MRO and ground handling

Air Serbia is considering restoring its own catering, Maintenance, Repair and Overhaul (MRO), as well as ground handling divisions following difficulties with third-party providers throughout the past three years. “Before the pandemic, outsourcing was normal in the industry. It was part of the transformation. Airlines got out of dealing with catering, handling, or aircraft maintenance and repair services. During the pandemic, everyone started looking at expenses and reducing fixed costs. Since last year, when demand for air travel skyrocketed, it’s mainly airports that are struggling”, Air Serbia’s CEO, Jiri Marek, told “Rynek Lotniczy” .

Commenting on the challenges faced by the airline in the three sectors, Mr Marek said, “Under a Joint Venture agreement with a partner specialising in aircraft repairs, we want to set up an MRO hangar at the airport [in Belgrade]. We are also looking at relaunching the catering business. We are dissatisfied with the product of a company with which we have a contract with for two years, and this is the only supplier. We are also thinking about our own cargo and handling services”.
Air Serbia began the process of outsourcing its catering and ground handling in 2019. Subsequently, Air Serbia’s catering division was absorbed by the privately-owned Airport Catering, which has been beset by a range of labour issues, including a strike last year, which, at the time, affected Air Serbia’s flights. Air Serbia Ground Handling Services, the in-house company serving Air Serbia aircraft at Belgrade Airport, transferred its employees to Belgrade Airport’s handling division several years ago after the airline outsourced its airport operations, including passenger services, supervision, station management, training, freight forwarding and customs clearance. This summer, the carrier reproached its hub airport for being underprepared for the busy travel period, which resulted in the delay and cancellation of some flights, as well as a notable amount of lost luggage affecting transfer passengers.

“Infrastructure at the airport is still being developed. We understand that eventually the renovation work will come to an end. Then we will be able to fully develop our business model. However, the expansion of our network was announced several months in advance. A lot of time passed from December to the beginning of July. Everyone had time to prepare properly … The airport operator was aware of our intentions. They should have prepared. If we do not develop, other airlines will take advantage of it”, Mr Marek noted.
Jat Tehnika, Air Serbia’s MRO provider, has also faced issues over the years. The airline has criticised a slow turnaround in aircraft maintenance and a lack of parts over the past year for the slow return of some aircraft into service. It has since begun sending a number of its jets to Turkish Technic, Turkish Airlines’ MRO provider in Istanbul. Turkish Airlines’ Chairman, Ahmet Bolat, said recently the carrier is considering opening an MRO subsidiary in Serbia, if an agreement is reached it is anticipated to be part of the potential Turkish Airlines – Air Serbia Joint Venture Agreement.

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