Bleak dilemmas for Cyprus Airways

CYPRUS Airways is urgently looking at ways to cut costs in the face of mounting losses and looming liberalisation of its most profitable routes.

With losses of £17.6 million for the first six months of 2003 alone, the vice-president of the airline’s board was yesterday reported to have suggested that two of the national carrier’s plane’s be either grounded or leased out to sister company Hellas Jet. Cyprus Airways has just completed a costly refurbishment of its fleet.

Cyprus Airways spokesman Tassos Angelis said yesterday he could not comment on Kyprianou’s propositions, as they were only suggestions.

“The company is trying to cut its costs. We are in the midst of different talks on how this can be done and are optimistic that we will reach a solution to the financial difficulties faced by Cyprus Airways,” said Angelis.

Kyprianou’s suggestions are understood to have met opposition from the rest of the board, who maintain that if the airline grounds two of its planes, then a number of temporary and permanent staff will automatically be made redundant.

Angelis admitted the airline was concerned its workforce should not lose out.
“We have spoken to all the relevant unions to examine ways in which the airline can benefit financially and not at the expense of its employees. Some of the matters on the table are a reduction in employees’ sick leave and the pilots’ accumulated leave.”
CY Chairman Constantinos Loizides acknowledges that Cyprus Airways is in financial trouble and that some action must be taken.

At present, Cyprus Airways’ main sources of income are its flights to Athens, Salonica and London Heathrow. A cause for concern for the airline is after Cyprus’ accession to the European Union, those lucrative routes will be opened to rival low-cost carriers, who will seek to lure passengers through aggressive cost-cutting.

“Our main objective is the reduction of costs and the increase of productivity. No final decision has been reached as to how this will be achieved,” said Angelis.

The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.