Insight: A round up of Russian airlines’ passenger traffic performances in 2019

Passenger numbers, trends, RPKs and seat load factors for last year’s top-20

Of the 107 carriers registered in Russia, the top-15 airlines were accountable for 92.6 per cent of the entire traffic (Simferopol Airport)

Russia’s airlines collectively carried some 128.3 million passengers last year, a healthy 10.3 per cent improvement on 2018, according to Rosaviatsiya, the nation’s aviation authority. Overall, the airline industry’s growth rate was just marginally down on the 11 per cent of the previous year.

Of the total traffic, 57 per cent, or 73 million passengers, travelled domestically. In the year, the industry’s RPKs increased by 12.6 per cent, reaching 322.98 billion.

Despite the positive figures, in general, Russia’s air transport industry continued to be plagued last year by global factors such as the weak economy and political tensions which, for example, resulted in restrictions on direct air connection with Georgia in 2019, and the on-going ban on flights to Ukraine. At the same time, high levels of competition and surging fuel and airport handling costs have also become a significant part of the industry’s current economic landscape.

Of the 107 organisations registered in Russia as commercial air transport operators in 2019, the top-15 airlines (see chart) were accountable for 92.6 per cent of the entire traffic, with the five largest carrying 64.6 per cent of the total.

Within the big five group, which has remained fairly stable over the last few years, a shift has now become apparent with the advance of Aeroflot Group’s low-cost subsidiary Pobeda Airlines. With a year-on-year growth rate of 43.2 per cent in 2019 it managed to outperform Yekaterinbug-based private airline Ural Airlines and moved up to the fourth place in the ranking, squeezing Utair Airlines out of the top-five list. If the LCC continues its aggressive growth this year, it may overtake sister carrier Rossiya Airlines and compete closely with S7 Airlines, now Russia’s second largest carrier. However, the budget airline is now limited in its ambitions by a seat capacity shortage, as deliveries of 13 contracted Boeing 737 MAXs are still in limbo.

The 2018 growth champion Pobeda was second-fastest last year, having been surpassed by the privately owned Nordavia which, after a rebranding, has re-emerged as Smartavia and through fleet expansion and an increased marketing effort achieved a remarkable 70.9 per cent growth rate.

The two leisure charter carriers Azur Air and Royal Flight also achieved high growth figures, exceeding their 2018 operational results by 36.6 and 30.8 per cent, respectively. The increase lifted the Russian-based, Turkey-backed Azur Air into seventh place in the league of Russian airlines’ traffic rankings and, with RPKs of 24.4 billion, the country’s largest charter carrier was also the fourth highest in Russia in that respect. Royal Flight, associated with Turkish OTI Holding, operates primarily in the interests of the country’s big tour operator Coral Travel. Last year it replenished its fleet with three Boeing 777-300ERs, an expansion that allowed the airline to offer additional new popular leisure destinations.

With a moderate growth rate of 4.1 per cent, flag carrier Aeroflot remains the unassailable market leader in Russia. Its privately-owned rival S7 Airlines merged in the second half of the last year with sister airline Globus and, since the two were listed as separate entities in Rosviatsia’s 2019 report, their individual growth figures unreliably show a rapid growth for S7 Airlines and a decline for Globus. In fact, the two operators’ traffic figures may be summed up as resulting in some 18 million passengers and compared with their combined 2018 results, reveal a more realistic 12.4 per cent growth, an indication of the group’s steady development despite the tragic loss in a private plane crash last year of Natalya Fileva, the co-owner and chairwoman of the board.

Last year’s fifth largest air carrier, Ural Airlines, with its healthy fleet expansion strategy, also appears to be on a steady growth track having achieved a seven per cent year-on-year traffic improvement. In the meantime, the financially stretched Utair Airlines took a cautious approach to its traffic growth plans, allowing it to marginally remain afloat.

In the smaller league, Azimuth Airlines, now 18th and the world’s only all-Superjet 100 operator that was launched just two years ago, grew by 86.3 per cent year-on-year, helped by a progressive fleet and route network expansion.

As for the future, Russia’s transport ministry forecasts that the growth of passenger traffic for Russian airlines in 2020 will be some seven per cent, which would be the lowest growth rate of the past few years.

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