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ČSA: Crisis gives us opportunity for further growth

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Czech Airlines sees the global financial crisis as an opportunity, and the company has decided boost its expansion. While its competitors are lowering their levels of operation, ČSA is planning to expand even during the winter season.

“We have decided that now is our best chance to get the biggest slice of the pie,” said Petr Pištělák, ČSA’s marketing vice president. The Czech air carrier is increasing, for instance, the number of its connections to Italy. It doesn’t want to miss the opportunity created by the problems of the Italian Alitalia. ČSA also wants to start offering more flights to Germany, Scandinavia and the Middle East.

“I think this is a good strategy,” said Jan Procházka, an analyst with Cyrrus.

He said it is a good lesson in marketing in times of crisis to consider things besides profit and revenue – such as the market share. He is, however, skeptical about the company’s increasing the number of its connections to Germany. “Companies will be trying to save money and their employees will probably be flying to Germany less, he said.

ČSA is also having to deal with increasing pressure from Vienna’s airport, which is favoured by an increasing number travellers, especially those living in Moravia.

“For that reason, we will fly more to Brno and Ostrava and are canceling completely our bus connections, which often suffer from delays due to traffic jams on the D1 motorway,” said Pištělák.

ČSA wants to focus more on lucrative business travellers. For instance, it now offers free taxi service to the airport for its first-class passengers. The company is hoping this service will be popular among foreigners, who don’t trust Czech taxi drivers. The company Rony Praha, which got the contract for passenger transport, will thus provide serious competition to AAA Radiotaxi, which has a monopoly at the airport.

Czech Airlines management is keeping in place the cost-saving measures outlined by company head Radomír Lašák earlier this year.

“I think by spring we can save USD 7 for every passenger,” said marketing director Jan Kaše. “We have 5 million passengers, so this ammount is not small,” he added.

New services for travellers will also save money. For instance, by giving customers the option to check in at the airport via SMS, ČSA can spend less on personnel at check-in counters. It is also continuing to promote its own booking systems, which saves money because the airline thus doesn’t need topay to any third party.

It’s also cutting costs by transferring its catering to an external supplier. “None of the costs are greater,” said Kaše. “Many are lower.”

The privatisation of ČSA has not begun yet, but the decision on the buyer should be made mid next year. Under strong consideration are Asian air carriers, which could make Prague their European transport hub.
This article was translated with permission by the Prague Daily Monitor.

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