ECONOMY

Greece grows more isolated by air from US, Asia

Greece is becoming increasingly isolated in terms of air travel, as reductions in flight frequency and mainly the suspension of direct flights have become a grim reality for the Greek air market.

A recent decision by Delta Airlines to stop direct flights between Greece and the US as of this fall may deliver the final blow as it means a severing of direct air ties between the two countries. While three years ago there were as many as five direct flights between Greece and the US per week, after late October the two countries will be disconnected for the first time in 45 years.

Delta was the last airline left on this route, as US Airways, which flies between Athens and Philadelphia, is operating the service for this summer only. Olympic Air stopped its flights to the US in 2009 and was followed by Continental. United Airlines also followed the same policy a year ago, so, come November, anyone flying between the US and Greece will have to do so through another European city.

How did Greece get to this point?

Firstly because of Olympic Airways, which used to be a state-owned national carrier and actively pursued a policy of limiting competition on this route back in its glory days, meaning that the route became unprofitable and there was little reason to keep it going. In the last few years of operation as a state-owned company and as its finances deteriorated dangerously, Olympic slashed its its long-haul flights as part of cost-cutting measures.

But there are other factors at play as well, such as the high cost of using Athens International Airport, which pushed Greece off the destination charts of a number of countries, including the US, and has led to a spike in the number of airlines that no longer fly to and from that airport.

Another major blow to the Greek market and to the Athens airport in particular has been the loss of Thai Airways, which had been active in Greece for about 36 years and has now pulled its direct flight between Bangkok and Athens. Gulf Air also stopped the Athens-to-Bahrain route, while Singapore Airlines has chosen Istanbul over its previous preference, Athens, for its link to its hub in Singapore.

The reduction in air links is also reflected in a significant drop in passenger traffic at the Athens airport. Total traffic in the period from January to April 2012 amounted to 3.49 million passengers at the country?s main airport, registering a 10.3 percent fall from the same period in 2011 or a drop of 300,000 passengers, with a further decline forecast for this coming winter.

Market sources argue that the lion?s share of the blame rests on Athens International Airport, which may supply high-quality services to its users but does so at particularly high prices. Its pricing policy ranks among the most expensive — in terms of cost of use — airports in Europe and beyond, at a period when the air market is suffering from, among other things, the high cost of fuel.

Naturally, this predicament also has a major impact on other economic domains. Tourism professionals, for instance, say that the cessation of direct flights between Greece and the US will also hit the cruise holiday sector, as many Americans choose to fly direct from the US to this country in order to board cruise ships.