CYPRUS AIRWAYS (CY) chairman Kikis Lazarides has called on the government to shut down or hand over state-owned airline Eurocypria, arguing the island simply isn’t big enough for two national carriers.
In a letter to the Finance Minister, reported in yesterday’s Phileleftheros, Lazarides proposed that CY absorb Eurocypria, suggesting that the continued operation of both airlines would ultimately lead to their ruin.
“We cannot have two national carriers co-existing in this place,” he said, adding that a CY study concluded that both airlines would fold if they continued competing for flights.
If Eurocypria was absorbed into CY, the national carrier would be able to bring in more tourists than the two airlines are currently doing working separately, said Lazarides, noting that more night flights could be introduced.
He rejected claims that Eurocypria’s demise would lead to a downturn in tourist arrivals. “This fairytale that we will stop flying tourists in because Eurocypria will stop operating as it is today is truly a fairytale,” he said.
The CY chairman also pledged not to meddle with Eurocypria staff numbers should the takeover occur. “If this plan proceeds, there is no chance any member of staff will be negatively affected.”
Eurocypria chairman, Lefteris Ioannou, was less keen than his CY counterpart on the takeover proposal. Ioannou argued that Eurocypria could survive in the current market, insisting that it was not a competitor to CY as it offered scheduled flights to regional airports, carrying 15 per cent of tourists to Cyprus.
The costs of CY are much more expensive than Eurocypria, he said. “What needs to be noted is Eurocypria brings in a large number of tourists, 15 per cent, flies to regional airports, where it takes passengers without hassle and brings them to Cyprus, and contributes substantially to tourism arrivals,” said Ioannou.
“I don’t see CY being affected. Eurocypria can stand on its feet. It is a company with very low costs, with people who work very hard, and I believe yes, it can continue to serve tourism,” he added.
Finance Minister Charilaos Stavrakis has agreed to meet with both chairmen in the coming weeks to discuss ways to solve the problems identified by both companies.
“It is sad to create the impression there is rivalry between the two state airlines, Cyprus Airways and Eurocypria. The state owns 70 per cent of Cyprus Airways while Eurcypria is 100 per cent owned by the state. Our efforts are for both airlines to be economically viable without state support and to thrive to bring the greatest number of tourists to Cyprus,” said Stavrakis.
A possible indication as to which way the wind blows at the Finance Ministry was Stavrakis response
When asked about the prospect of greater cooperation between the two companies, Stavrakis said such a move “would have significant savings in operational costs”, perhaps an indication of which way the wind is blowing at the Finance Ministry.
