UTAIR AVIATION UTair Aviation has announced the first interim results of Impulse, an operational efficiency improvement and cost optimization program launched in summer 2014 aimed at securing stable and efficient airline operations in the new economic conditions.
"The next phase of the Impulse program combined with a new UTair development strategy will allow us to overcome current financial difficulties in the near future, significantly increase business efficiency and, as a result, improve the attractiveness of UTair to investors and partners," said UTair General Director Andrey Martirosov.
Thanks to a series of measures aimed at route network optimization, UTair removed 33 aircraft from its fleet, including six Boeing 737-800, 12 Airbus A321 and 15 Bombardier CRJ 200 aircraft. In addition, a charter airline created by the UTair Group on the base of Katekavia has been allocated nine Boeing 757-200 and two Boeing 767-300 aircraft from UTair. In total, during the period since the launch of the Impulse program, UTair has reduced the size of its fleet by 44 units from 115 to 71 aircraft.
The decision to optimize the UTair route network and reduce fleet size is connected to a decrease in demand for air transport services on particular destinations combined with a drastic increase in leasing payments, which are denominated in foreign currency and calculated according to the current currency rate.
Securing the highest level of flight safety remains the top priority for UTair. The optimization measures the airline has taken do not affect processes concerned with maintaining the highest level of airworthiness of UTair aircraft, the training of aircrews or any other activities necessary for securing the flight safety.
At the same time UTair is continuing to actively implement a new development strategy capable of securing effective and profitable flight operations despite the currently unfavorable market conditions. UTair has designed and launched its Spring-Summer flight schedule which involves performing 200 flights to 165 destinations daily during the high season. To fulfill this operating program, UTair will make use of every aircraft in its fleet. Over 160 flights to over 50 destinations will be performed daily from Vnukovo International Airport alone.
"The optimization of the UTair fleet will allow us to save over $100 mln per year due to reduced leasing payments alone," concluded Mr. Martirosov. "Along with the realization of other measures for improved performance, this will allow us to reach an even higher level of economic efficiency in this year."
The Impulse program was launched in July 2014 and includes a series of measures for optimization of the UTair route network, aircraft ground handling and MRO, reducing time required for servicing passengers, increasing aircraft turnaround rate, automation of planning processes and MRO activities. The program involves improving efficiency of existing distribution channels and the introduction of alternative service sales methods. In regard to products offered, the UTair Group will reorient its focus towards budget air travel.
The Impulse program will affect all major UTair Group subsidiaries in some way. The number of UTair Group subsidiaries and associates will be significantly reduced and some of these enterprises will undergo restructuring.
Impulse Program is a result of analysis of the best global practices in aviation such as the SCORE program currently implemented by Lufthansa, the TRANSFORM program implemented by KLM/Air France and similar programs developed by Delta Airlines and other US companies
UTair Group is one of the largest aviation groups in Russia. The Group comprises companies performing aircraft operations with fixed and rotary wing aircraft as well as enterprises offering MRO, personnel training, flight services and air transportation sales services. In 2014 UTair Group aircraft transported 11,204,598 passengers. UTair Aviation, the core company of the group, ranks among the top three Russian airlines. The airline maintains its central hub at Vnukovo International Airport in Moscow. The Group includes UTair-Express, Turuhan, Vostok Airlines, Helisur, UTair Europe, UTair South Africa, UTair India, TS-Technik, UTair-Engineering, Ural Aviation Services, Katekavia, UTG and other enterprises. UTair Group employs over 14,000 people. UTair Group headquarters are located in Surgut. Additional information is available at www.utair.ru/en.
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