The government is to extend a programme for reduced airfare flights between Russia's Far East and central regions, allocating 50% more funds for it in 2010, Russian Transport Minister Igor Levitin said. Airlines consider the programme successful since it has stimulated demand without reducing profitability. However, they believe that it is impossible to combine the programme with support for Russian aircraft manufacturers.
Levitin reported to Prime Minister Vladimir Putin yesterday on the results of the programme for subsidised air flights for Far East residents up to 23 and after 60 years old. The programme's efficiency was proved by the increase in passenger traffic to and from the region over the previous year despite the country's overall fall in passenger traffic, he said. Levitin forecast that if the government approved the ministry's proposals on extending the programme, passenger traffic to and from the region could rise by 50%. The 2010 budget allocated 2.5 billion roubles in subsidies for the programme, 1.5 times more than in 2009, the Federal Air Transport Agency said.
Over 163,000 people used the lower fares on 18 air routs from the Far East to Moscow, St Petersburg and Sochi from May 15 to October 31, 2009, the Agency added. Seven airlines participated in the programme: Transaero, which sold over 53,600 tickets, Yakutia Air with 33,600 tickets, Vladivostok Avia with over 28,000 tickets, Aeroflot with 26,600 tickets, S7 Airlines with 11,300 tickets, Rossiya Airlines with 7,300 tickets and Alrosa Mirny Air Enterprise with 3,100 tickets. The subsidies totaled 1.2 billion roubles, less than the programme's cap of 1.7 billion roubles.
The Agency could not give exact figures for passenger traffic growth at a discount rate yesterday. However, the Transport Clearing House has confirmed growth in passenger numbers. Passenger traffic from Khabarovsk to Moscow in September grew 18.2% year-on-year and from Vladivostok to Moscow rose by 23.1%. The return traffic from Moscow to the Far Eastern towns respectively surged by 7.5% and 22.2% in August. Overall passenger traffic fell by 11% in August and by 6% in September.
The airlines have welcomed the programme and back the Transport Ministry's forecast for 2010. "Serving those who use the reduced fares was barely profitable. However, children rarely travel alone, thus more parents could fly," Transaero's Deputy Director General Dmitry Stolyarov said. Aeroflot told Kommersant that the programme allowed the airline to maintain a profitable passenger service whilst stimulating demand and increasing the number of passengers on Far Eastern flights.
Airlines expect the programme to be extended: those who use reduced fares currently account for a very small share of overall passenger traffic. The airlines have called into question some of the ministry's new proposals, however. "For example, they suggest that subsidies should first be provided for flights on Russian aircraft and, after that, for those using foreign aircraft," a source in an airline company told Kommersant. "If a company substitutes the aircraft for some reasons what will the Air Transport Agency do?" The source added that it would be better to provide subsidies for those companies that have Russian aircraft in their fleet, since not all of them can be used for Far Eastern flights.
Alexei Yekimovsky