Marius Gelžinis is the President of Lithuanian Airports.
"The year 2018 will go down in history as one of the best years for Lithuanian Airports' aviation thanks to the new records recorded; handling 6.3 million passengers and 61,000 flights performed."
Last August, Lithuanian Airports appointed new directors for Vilnius, Kaunas and Palanga airports. What are your main challenges in the medium term?
The main objectives of airport managers are to improve passenger satisfaction indicators, to make investments, to develop planned projects in the different divisions and to motivate employees and increase their commitment.
The Blitz sessions are Lithuanian Airports' new initiative to encourage change and open up possibilities for Vilnius, Kaunas and Palanga airports to strengthen demand for new routes. How and why did this project come about?
Attracting a new airline or route involves a good deal of competition. Competing successfully with all European airports, i.e. those with considerably larger markets in terms of residents, economic development, level of subsistence, contribution of national authorities, municipal organisations, business associations and individual companies, both in terms of financial backing and other means, is of particular importance for the entry of new airlines into the market or the opening of new routes.
When considering the introduction of a new flight, airlines most often base their decision on the assessment of the country or city where the airport is located, i.e. the size of its market, the demand for business and holiday flights, the expected profitability of the destination, the operational possibilities and other important indicators, rather than on the airport to which they will fly their aircraft.
There is no doubt that the Blitz initiative will contribute to competitive success with other airports, as the mobilisation of different stakeholders towards a common goal will increase the chances of attracting new routes.
So far, new flights have been attracted by applying discounts on airport charges and by granting airlines aid from de minimis up to a value of €200,000 for 3 years.
Lithuanian Airports has already accumulated several examples of successful partnership cooperation: with the financial support of the Kaunas City Council, the Polish airline LOT changed Kaunas airport's image as a low-cost airport by offering flights to Warsaw. The association of municipalities in the Klaipėda region was very successful in attracting flights from Palanga to London Luton and Dortmund airports.
The Blitz sessions have been very well received by the participating airlines, so we hope to reap the rewards of this initiative soon.
The Polish airline LOT has recently won an international public tender launched by Lithuanian Airports to connect Lithuania and the UK with the aim of encouraging investment. This is the first case in the EU where a flight mechanism aimed at attracting business class passengers will receive state backing. What other measures to boost passenger growth will be put in place?
Lithuanian Airports currently offers a wide range of incentive schemes to attract new routes and boost passenger numbers:
- Incentive scheme for new VNO and PLQ routes, based on discounts on landing, passenger disembarkation and parking fees. Discounts are valid for the first 3 years of operations.
- Incentive for volume of passengers carried on KUN. Applies to all airlines handling more than 5,000 passengers (embarkation and disembarkation) during the operating year.
- The network incentive scheme, from which airlines operating at more than two Lithuanian airports can benefit.
- A help de minimis for marketing for new routes or additional flights up to a maximum amount of €200,000 over a period of three years.
During 2018, Lithuanian airports granted almost €9 million in aid through these four mechanisms.
Passenger numbers increased tenfold at Vilnius, Kaunas and Palanga airports in 2017. They handled 5.2 million passengers on a total of 55,000 flights. What are the figures for 2018?
The year 2018 will go down in history as one of Lithuanian Airports' best years for aviation thanks to new records; handling 6.3 million passengers and 61,000 flights. The most significant figure was recorded by the country's main airport, Vilnius, although the year also brought intense activity for the Kaunas and Palanga divisions.
Passenger growth reached 19% and flight growth reached 11%.
The most significant traffic in its history, with 4.9 million passengers, was recorded by Vilnius airport, which exceeded the 2017 results by more than one million passengers, i.e. 30%.
Kaunas Airport opened an important new page in its history in 2018 with the expansion of its business profile. The first traditional airline started operating from this airport, allowing Polish airline LOT to offer even more services to customers demanding business flights. Near the end of the year, Kaunas airport announced its impressive results, which surpassed the threshold of one million passengers handled. During the previous year, this figure could only be reached due to the reconstruction of the new Vilnius airport motorway, which meant that a large volume of passengers had to be diverted to Kaunas for more than a month.
Palanga airport also set a new record. It served more than 316,000 passengers, 7% more than the previous year.
The Lithuanian government estimates that investment in the expansion of Vilnius, Kaunas and Palanga airports will have reached 700 million euros by 2028. What are the main guidelines of this strategic plan?
We have not yet finalised these plans. Lithuanian Airports is a state-owned company; therefore, all major investments require responsible analysis at the highest governmental level. Until the solutions are fully designed, we cannot advance any details related to strategic infrastructure changes.
