ECONOMY

Bulgaria launches new air carrier after liquidating Balkan Airlines

SOFIA – Bulgaria launched its new national flag-carrier, Balkan Air Tour, yesterday to replace Balkan Airlines, which was declared insolvent and grounded last week. The government wants to sell a 49 percent stake in the company to a foreign investor to earn cash for its development, a plan that aviation experts say will be tough to execute given the downturn in the global aviation sector. The first flight of the new airline was to London and Paris and a flight to Berlin and Frankfurt was scheduled for later yesterday. «We prepared the new airline’s launch for a month – work usually taking months or a year – and managed to secure a smooth transition to a new flag-carrier without stopping flights,» Transport Minister Plamen Petrov told a news conference. Balkan’s liquidation is part of a plan by the Transport Ministry, yet to be realized, for the new carrier to inherit Balkan Airline’s assets, destinations and staff, but not its debt. Predecessor’s agony Balkan Airlines was grounded on Saturday after the Sofia City Court ordered a halt to its activities and its liquidation, putting an end to the agony of the airline that has been in receivership since March 2001. The expected ruling came after the state, the biggest creditor, rejected a plan to revive the carrier, whose debts top $90 million. From Saturday to Tuesday, Balkan Airlines’ schedule was flown by local private company Hemus Air. The ministry won permission from national aviation bodies of 15 states in Europe and the Middle East for the new airline to operate to destinations previously covered by Balkan. «A big achievement was succeeding in talks with major European airports for retaining Balkan Airlines’ slots, which are among its most valuable assets,» Petrov said. The new state airline will initially use a government-owned Tupolev TU-154 aircraft and two Boeing 737-300s, which Balkan Airlines had leased from Germany’s Lufthansa. Petrov said the company had already hired a staff of 100 people, most of whom previously worked at Balkan Airlines. Balkan Airlines had about 1,000 staff and scheduled flights to 14 destinations, most of them in Europe. More than 50 percent of its debt, which stood at 180 million levs ($92.1 million) in March 2001, is owed to the state. In the 1990s, Balkan’s fleet of some 30 aircraft, which then included Airbus A-320s, Boeing 767-200s and Boeing 737-500s, flew to more than 50 destinations in a failed effort to become a major world carrier. Aviation experts say that to avoid its predecessor’s fate, the new airline should focus on serving a number of profitable destinations in the region and Europe at competitive prices.