Despite the persisting challenges in the aviation sector, Lithuanian Airports, together with partners, are mobilizing investments for the recovery of passenger flows. The measures plan for the near future has already been approved for this particular purpose. The overall investment planned in 2021 to promote airline flights is expected to increase and amount to about 10.6 million euros. In 2020, such investment amounted to about 8 million euros.
According to Aurimas Stikliūnas, Head of Aviation Services at Lithuanian Airports, strong passenger determination to fly in the near future is felt. Therefore, a vaccination process that is gaining momentum on a global scale and increase in demand for flights associated with it, lifting travel restrictions in European Union (EU) countries, future technological solutions for the health screening of travellers (certificate of immunity), changes in passenger segments and possibilities to choose geographically distant further routes will lead to recovery of flights this year.
According to the aviation expert, after airlines began to re-plan their activities, route promotion programs applied by airports and general incentive package for airlines offered by the state will have a significant impact on the recovery of flights in the near future in a competitive environment of European countries. This is also confirmed by the forecasts of international organisations.
“Continuous investment by Lithuanian Airports and partners in promotion of airline activities pays off every year. Therefore, to ensure as fast and efficient as possible recovery of the aviation sector, this year, the overall investment to promote flights exceeded 10.6 million euros. A little over half of this amount (5.8 million euros) consists of investment of Lithuanian Airports and planned discounts, and the other part is allocated by our partners through various programs: The Ministry of Transport has allocated 1 million euros to promote flights under the De Minimis measure, the Ministry of Economy and Innovation has planned to allocate 3.8 million euros under the Public Service Obligation measure. The strategy chosen allows promoting different airlines and thus create conditions for competition at Lithuanian Airports without granting exclusive status to a particular airline. Latvia, for example, has taken a different path and promotes exclusively its national airline, in which in 2020 alone the country had to invest 250 million euros", - says A. Stikliūnas.
It is said that solutions to promote flights are also being sought in joint projects together with the representatives of Go Vilnius, Lithuania Travel, Kaunas IN, Association "Klaipeda Region", Invest Lithuania.
According to the aviation expert, Lithuanian Airports have already approved the near-term action plan for promotion of routes and some measures have already begun to apply. The key objectives for this year: to ensure connection with strategic aviation centres in Europe, to restore at least half of the normal monthly passenger flow (of 2019), and, without a doubt, to ensure security requirements in the new travel reality.
Investment ensures competitive advantage in the region
Lithuanian Airports manage and constantly improve key tools for promoting flight development: apply fee discounts, implements measures to promote the marketing of directions of flights. The enterprise also helps to form a targeted portfolio of partner support, which consists of different promotion programs and measures.
According to A. Stikliūnas, Lithuanian Airports, as the largest providers of aviation infrastructure services in Lithuania, contribute significantly to the economic growth of the country: help attract direct investment from foreign and domestic businesses, create new jobs both in direct activities in or around airport territories, and in business sectors that are dependent on aviation flows. That is why, Lithuanian Airports, by applying various promotion programs for airlines, seek to attract additional flights and increase passenger flows.
In order for the airline incentive scheme to be continued, Lithuanian Airports brought together regional municipalities, tourism, business associations and other partners. According to A. Stikliūnas, the overall investment allocated and its continuity will be a key factor that will determine competitiveness of Lithuanian Airports in the whole region.
“In attracting airlines, Lithuanian Airports have to compete with other European airports of similar market size. A flight promotion plan that is being implemented gives Lithuanian Airports a competitive advantage. Therefore, a coherent, coordinated and long-term mechanism of promoting the development of routes and of risk sharing with carriers, which includes all interested parties, is necessary for an effective process of attracting companies. Here, the overall state support package and the promotion of tourism for organisations also play an important role because companies choose the country to which the flights will be operated, rather than an airport”, - says the representative of Lithuanian Airports.
Growth of passenger flows is expected
Number of passengers at European airports is estimated to have fallen by an average of 66% in 2020, and losses amounted to about 118 billion US dollars. The COVID-19 pandemic also significantly affected the aviation results of Lithuanian Airports. Compared to 2019, last year, the number of passengers fell by 72%, and the number of flights has halved.
The number of cargo transported, which grew by 16%, and unchanged number of operating airlines are the only indicators that have improved.
Despite the year 2020, which has caused huge challenges for the aviation industry, according to A. Stikliūnas, more than 50% of normal monthly passenger flow (of 2019) is planned to be achieved at the end of this year, and it is projected that, at the end of the year, the monthly number of flights may reach 70% of the average monthly traffic of 2019.
About Lithuanian Airports
The network of Lithuanian Airports includes three air gateways in Vilnius, Kaunas and Palanga. In 2020, 1.8 million passengers and 30 thousand flights were served at Lithuanian Airports.