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Greece Tries To Keep Olympic Air Aloft  
User currently offlineLayitontheline From Canada, joined Jan 2002, 85 posts, RR: 0
Posted (12 years 7 months 1 week 1 day 3 hours ago) and read 1810 times:

Greece tries to keep Olympic Air aloft


By DINA KYRIAKIDOU
Reuters News Agency


Tuesday, February 19, 2002 – Print Edition, Page B11


ATHENS -- Greece has pledged to keep its ailing Olympic Airways from becoming the third European national carrier to fold in six months, scrambling to draft another rescue plan after last week's failure to sell it.

Transport Minister Christos Verelis said yesterday the government, which sees Olympic as a test of its privatization plans, now wants to restructure the debt-ridden airline.

The high-profile attempt to privatize Olympic flopped when the only remaining suitor missed a Friday deadline to provide the financial assurances demanded.

"The next step in our efforts will be a restructuring," Mr. Verelis told the Flash radio station. He said details of the plan would be announced by the end of the week.

Olympic staff were exasperated with the uncertainty.

"We are living in a constant state of anxiety and insecurity," said an Olympic employee.

Government sources said the new plan, aimed at making the airline more attractive for a future sale, involved splitting Olympic into a flying company with a new business plan, and another that will assume all debts.

Olympic has accumulated well over 100 million euros ($87.34-million U.S.) in debt in taxes, airport fees and contributions to social security funds. Last year, it also took out a commercial loan of $180-million to move to a new Athens airport.

The restructuring foresees voluntary retirements and moving staff to other state positions. Government sources would not confirm press reports of 2,500 job cuts.

The plan foresees funding through private banks, since the European Union, which has seen the failure of two previous restructuring plans it approved for Olympic, has banned Greece from pouring more money into it.

Aviation analysts were skeptical.

Dan Solon at Avmark International aviation consultants in London said the best solution could be for a private investor to start from scratch.

"The way forward could be to simply close the existing operation, to start with a blank sheet of paper," he said.

He said it was unlikely the EU would bend the rules for Olympic after other European airlines had sought aid in vain.

The EU stood firm against Belgian government attempts to put money into the largest Belgian airline, Sabena, which subsequently collapsed last year, as did Swissair after weighty debts finally proved too much to bear in the aftermath of the Sept. 11 hijack attacks.

______________

will they make it??


29 replies: All unread, showing first 25:
 
User currently offlineAFC_ajax00 From United States of America, joined Nov 2000, 775 posts, RR: 0
Reply 1, posted (12 years 7 months 1 week 1 day 2 hours ago) and read 1676 times:

I hope not!! worst airline i ever flew on!


Once you have tasted flight, you will walk the earth with your eyes turned skyward; for there you long to return
User currently offlineSQ325 From Germany, joined Jul 2001, 1451 posts, RR: 7
Reply 2, posted (12 years 7 months 1 week 1 day 2 hours ago) and read 1669 times:

In their present condition they won't make it.
They need to cut a lot of long haul services and some european destinations. over the long term they will become a carrier serving a european network. The were every country "needs" a carrier serving destinations all over the world are over. Maybe in the future they'll be able to restore some overseas destinations.

regards Bjoern


User currently offlineTEDSKI From , joined Dec 1969, posts, RR:
Reply 3, posted (12 years 7 months 1 week 1 day 2 hours ago) and read 1662 times:

What Olympic needs to do is to merge with an American or European carrier who has similar aircraft in their fleet as OA.

User currently offlineJmc1975 From Israel, joined Sep 2000, 3279 posts, RR: 15
Reply 4, posted (12 years 7 months 1 week 1 day 1 hour ago) and read 1653 times:

I know someone who flew on Olympic Airways years ago and found the service to be rather primitive. The inflight meal (and entertainment) on a FCO-ATH segment consisted of a fat lady with missing teeth and a hairy tit hanging out of her blouse, going down the aisle with a bowl of jelly beans from which the passengers reached in a grabbed a handful. Hmmm......







.......
User currently offlineAlitis From United States of America, joined Apr 2000, 259 posts, RR: 0
Reply 5, posted (12 years 7 months 1 week 1 day 1 hour ago) and read 1642 times:

"I know someone who flew on Olympic Airways years ago and found the service to be rather primitive. The inflight meal (and entertainment) on a FCO-ATH segment consisted of a fat lady with missing teeth and a hairy tit hanging out of her blouse, going down the aisle with a bowl of jelly beans from which the passengers reached in a grabbed a handful. Hmmm......"

This quote sounds familiar-did you plagerise it from another thread concerning another airline?


User currently offlineSquigee From Canada, joined May 2001, 652 posts, RR: 4
Reply 6, posted (12 years 7 months 1 week 1 day ago) and read 1637 times:

Jmc1975- Heads up, man. There are a few people in this forum who will defend Olympic Airways to the death who will pounce on you for your post. Search for a thread about Olympic's 747 with my username, you'll see.


Someday, we'll look back at this, laugh nervously, and then change the subject.
User currently offlineJmc1975 From Israel, joined Sep 2000, 3279 posts, RR: 15
Reply 7, posted (12 years 7 months 1 week 17 hours ago) and read 1605 times:

I wouldn't have posted this reply if it wasn't an actual experience that I heard about. If it's any comfort, it was quite awhile ago.


.......
User currently offlineAgrodemm From Greece, joined Apr 2000, 401 posts, RR: 0
Reply 8, posted (12 years 7 months 1 week 16 hours ago) and read 1587 times:

Jmc1975: You have posted this comment 3 times in the forum. I can not see how this story you have heard makes you such a zealous critic of OA. To me it sounds like un urban legend. I highly doubt that such a description can ever happen in any airline. As a Greek, I have been travelling with OA for years (late seventies). I myself find that the service sometimes is not good, but that is something to expect from all state-owned airlines.
Anyway,
Speak for yourself please,




User currently offlineJmc1975 From Israel, joined Sep 2000, 3279 posts, RR: 15
Reply 9, posted (12 years 7 months 1 week 16 hours ago) and read 1586 times:

Actually this was back in the 1960s, so for those of you are are greatly offended by this: not to worry. As I myself am perfectly willing to give OA my business if I fly to Greece.


.......
User currently offlineAlitis From United States of America, joined Apr 2000, 259 posts, RR: 0
Reply 10, posted (12 years 7 months 1 week 11 hours ago) and read 1569 times:

It's not offensive, just childish.

User currently offlineMarcos From United States of America, joined Jun 2001, 68 posts, RR: 0
Reply 11, posted (12 years 7 months 1 week 10 hours ago) and read 1560 times:

I love jelly beans!

User currently offlineKonstantinos From Greece, joined Jun 2001, 389 posts, RR: 0
Reply 12, posted (12 years 7 months 1 week 7 hours ago) and read 1549 times:

"...a fat lady with missing teeth and a hairy tit hanging out of her blouse, going down the aisle with a bowl of jelly beans..."

That sounds like me taking the piss out of Olympic ! I don't think anything like this has ever happened but anyway, it's a good one ! I can just imagine it.

Anyway, Olympic will be ok. They will not fire any people, just yet. Infact they will be taking some 200+ seasonal employees very soon. So, things can't be that bad. As for their intercontinental routes, the only one doing bad is New York. Montreal, Toronto, Johannesburg, Bangkok, Sydney & Melbourne are doing very well with an average of about 80% loads on some of them.


User currently offlineTEDSKI From , joined Dec 1969, posts, RR:
Reply 13, posted (12 years 7 months 1 week 7 hours ago) and read 1541 times:

I thought the JFK to ATH route was the most profitable?
It is out of JFK that many Greeks living in the USA fly to ATH.


User currently offlineKonstantinos From Greece, joined Jun 2001, 389 posts, RR: 0
Reply 14, posted (12 years 7 months 1 week 7 hours ago) and read 1540 times:

When i was in the US in 1994, I flew back to Greece on a Delta 767-300 and I enjoyed the service very much. Some people like to stick to one airline. I like to have a choice.

User currently offlineLj From Netherlands, joined Nov 1999, 4430 posts, RR: 0
Reply 15, posted (12 years 7 months 1 week 5 hours ago) and read 1532 times:

Konstantinos, you don't happen to know the yield on the OA flight? I've always been under the imnpression that yield are very low on all OA flights.

Given the way OA is performing over the last few years I don't undertand you say that things are that bad. OA has been one of the European airlines which was always bailed out by their governement for the last decade. Moreover, any proposal to make the airline profitable has been thrown out as soon as possible. Finally, a debt burden of EUR 120mio and the fact that (apart from those living in Greece) nobody sees any viability in OA doesn't really help. However, I agree for the employees OA will always be paradise as nobody dares to take the appropiated measures.

BTW I probably know the "rescue" plan. The Greek government will beg for money from its rich enterprises/people (lure them with tax benefits). They will probably call upon their "civil" duty to help the Greek society by putting EUR X million into OA. The Greek governemnet will find a way via local or regional bodies to put yet another EUR X million into OA. Finally the Greek government will figure a way out to waive some obligations (like landing fees, contributions to social security fund).

In short. They'll follow SR and SN.

Regards
Laurens



User currently offlineSabena 690 From , joined Dec 1969, posts, RR:
Reply 16, posted (12 years 7 months 1 week 5 hours ago) and read 1525 times:

Hey,

I really hope they make it!!!

When I saw what happened with Sabena, this is really awful.

Olympic, stay in the air please!!!!

Best regards,
Frederic


User currently offlineTEDSKI From , joined Dec 1969, posts, RR:
Reply 17, posted (12 years 7 months 1 week 4 hours ago) and read 1518 times:

What OA needs to do is to evaluate what routes are profitable and what are not. The routes that don't make profits OA should either get rid of them or just offer once a week flights. Try to purchase or lease new aircraft that are similar in size and capacity to the other carriers that serve that route such as DL using 767-300ERs or MD-11s on the JFK to ATH route.

User currently offlineUnderminer From Greece, joined Aug 2001, 42 posts, RR: 0
Reply 18, posted (12 years 7 months 6 days 8 hours ago) and read 1480 times:

The greek government feces at this moment many problems. If OA goes bankrupt, then I believe there will be a major political problem. So they have try hard for OA (maybe for the first time the last 25 years). But the EU pressures so... no one can be sure.
They can't fire anyone, because of the political cost. However 2000 OA employees either will work for the state or will be early retired.

Konstantino, if OA flied only to BKK and had a code-share flight between BKK and SYD/MEL it would stop loosing 20,5-23,5 million € pro year (and that according to the airline).
I have no information about the ATH-JFK route.


User currently offlineUnderminer From Greece, joined Aug 2001, 42 posts, RR: 0
Reply 19, posted (12 years 7 months 6 days 8 hours ago) and read 1465 times:

The greek government aprooved the future plan for OA proposed from the minister of Transportation today.
What will happen to OA:
1. OA will split to 5 companies. One will be in charge of flights only (Olympic Airways). The other 4 will be Olympic Catering, a ground handling company, a fuel distribution company and the tecnical support company. The 4 companies will be sold as soon as possible.
2. 2000 employees will leave the airline in 2 years
3. Reconstruction of the Managment (which managment???)
4. The working contracts-most of flight crews- will change.
This project will cost 100-150 million €.
Credit Suisse First Boston will have to found the private investors who will aquire more of 51% of the airline.

But no information about the debt....

In greek:
http://financial.flash.gr/ellada/ellada1/2002/2/21/11629id/
http://www.in.gr/news/article.asp?lngEntityID=362256&lngDtrID=251


User currently offlineKonstantinos From Greece, joined Jun 2001, 389 posts, RR: 0
Reply 20, posted (12 years 7 months 6 days 7 hours ago) and read 1453 times:

Like I said once before, Olympic needs to stop servicing other airlines ON CREDIT terms.(IOU's)
Big mistake with the A340-300's. They should have gone for B767-300ER's.
And also they need to sort out the crews that get to stay over in Australia for as long as 2 weeks spending all those Olympic Dollars at 5 star hotels etc.


User currently offlineEugdog From United Kingdom, joined Apr 2001, 518 posts, RR: 0
Reply 21, posted (12 years 7 months 6 days 6 hours ago) and read 1451 times:

These full cost airlines are locked into high cost operations with unions that will not budge on compulsory redundancies or other cost savings . The only way to deal with the problem is to shut down the airline and start from the ground up by rehiring only the workers needed at the rates which are affordable.

As I said earlier let the big airlines go under to be replaced by low cost carriers with operating costs less then half of the big airlines!!!


User currently offline0A340 From United States of America, joined Nov 2000, 266 posts, RR: 0
Reply 22, posted (12 years 7 months 6 days ago) and read 1430 times:

For more than 25 years the Government has "tried" to restructure, organize, re-organize, etc etc this company. For more than 25 years the airline has been loosing money, the People's money, which would be better spend on infrastructure than OA crews spending 2 weeks in Australia every trip.

Why, oh why would now another attempt succeed?

Why, oh why would suddenly an airline that hasn't published a yearly reconcilation since 1999 make now a winning business case?

Ever heard of "Πύθος των Δαναϊδων" ?

My 0.02 E

PS: I don't want to hear that the reason the airline is loosing money is the "other" airlines not paying for the ground service. After all, it used to be a monopoly - they didn't even have a choice. Recently, this ground handling business was liberalized. Why did OA continue servicing other airlines if there was no business case?


User currently offlineKonstantinos From Greece, joined Jun 2001, 389 posts, RR: 0
Reply 23, posted (12 years 7 months 5 days 6 hours ago) and read 1407 times:

"PS: I don't want to hear that the reason the airline is loosing money is the "other" airlines not paying for the ground service."

Why is it that you don't want to hear about this A340 ? It's the truth. Do you have any idea on how many millions of dollars other airlines owe Olympic ? You think it's easy for OA to stop servicing others. Who do you think used to service Aegean and Cronus ? Olympic used to service Cronus planes and now they go to Tanagra to be serviced by the airforce. Has Cronus payed ? Have the other airlines payed that have gone bankrupt?

If OA also goes bankrupt, then God help the government and foreign airlines that attempt to fly within Greece.


User currently offlineLj From Netherlands, joined Nov 1999, 4430 posts, RR: 0
Reply 24, posted (12 years 7 months 5 days 5 hours ago) and read 1401 times:

Konstantinos, allthough I don't know which airlines (if any) don't pay OA for their ground handling I don't think this is a big issue. Ground handling companies always work on credit (for a short period). Given that OA is not in a very well financial state they're lucky to get credit outside Greece. Moreover, the fact that you may loose money due to a bankruptcy is 50% OA's fault as they should have revoked the credit line as soon as they knew that the airline didn't live up to its obligations. The amount which remains can be seen a business risk and this is not very different from what happens at other companies (and they aren't on the edge).

BTW no foreign airline will ever fly Greek domestic flights (the only lucrative business in Greece is probably the international traffic from Athens, a business which is controlled by the foreign airlines). Oh yes the EU already indicated that the Greek government may support a Greek (or non Greek) airline to have these flights.


25 OA412 : Other airlines may owe OA money, I do not know, but apparently OA isn't all that great at paying the bills either. AIA officials were quoted as saying
26 Mrman_3k : I am half Greek and all I have to say is that it is probably time for them to get their act together, and not party quite as hard, maybe try I guess y
27 0A340 : The most humane thing to do is to let the airline die and start from scratch. Dare I say that this is the only sensible thing to do? 2 B Euros have be
28 Konstantinos : "...working hours where you start in the morning and work all the way to the evening hard. Not get go to work, take a 4 hour lunch break and sleep the
29 Lj : Why, if the problem is mangement, isn't OA able to get good managers? Probably because all good managers know that they won't get the support from the
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