layitontheline
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Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 5:43 am

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??
 
AFC_Ajax00
Posts: 740
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 5:48 am

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
 
SQ325
Posts: 1274
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 5:50 am

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
 
Guest

RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 5:56 am

What Olympic needs to do is to merge with an American or European carrier who has similar aircraft in their fleet as OA.
 
jmc1975
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 7:16 am

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......




.......
 
alitis
Posts: 233
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Jmc1975

Wed Feb 20, 2002 7:43 am

"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?
 
Squigee
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 7:47 am

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.
 
jmc1975
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 2:44 pm

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.
.......
 
agrodemm
Posts: 383
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 4:37 pm

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,


 
jmc1975
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 4:43 pm

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.
.......
 
alitis
Posts: 233
Joined: Wed Apr 19, 2000 11:20 pm

RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 9:44 pm

It's not offensive, just childish.
 
marcos
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RE: Greece Tries To Keep Olympic Air Aloft

Wed Feb 20, 2002 10:16 pm

I love jelly beans!
 
Konstantinos
Posts: 364
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RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 1:23 am

"...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.
 
Guest

RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 1:30 am

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.
 
Konstantinos
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RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 1:39 am

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.
 
LJ
Posts: 4103
Joined: Wed Nov 17, 1999 8:28 pm

RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 3:34 am

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

 
Sabena 690
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RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 3:37 am

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
 
Guest

RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 4:03 am

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.
 
underminer
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RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 21, 2002 11:48 pm

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.
 
underminer
Posts: 42
Joined: Wed Aug 22, 2001 7:00 pm

RE: Greece Tries To Keep Olympic Air Aloft

Fri Feb 22, 2002 12:24 am

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
 
Konstantinos
Posts: 364
Joined: Mon Jun 25, 2001 5:29 am

RE: Greece Tries To Keep Olympic Air Aloft

Fri Feb 22, 2002 1:30 am

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.
 
eugdog
Posts: 426
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RE: Greece Tries To Keep Olympic Air Aloft

Fri Feb 22, 2002 1:45 am

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!!!
 
0A340
Posts: 262
Joined: Tue Nov 21, 2000 3:10 am

RE: Greece Tries To Keep Olympic Air Aloft

Fri Feb 22, 2002 8:22 am

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?
 
Konstantinos
Posts: 364
Joined: Mon Jun 25, 2001 5:29 am

RE: Greece Tries To Keep Olympic Air Aloft

Sat Feb 23, 2002 2:44 am

"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.
 
LJ
Posts: 4103
Joined: Wed Nov 17, 1999 8:28 pm

RE: Greece Tries To Keep Olympic Air Aloft

Sat Feb 23, 2002 3:01 am

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.
 
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OA412
Crew
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RE: Greece Tries To Keep Olympic Air Aloft

Sat Feb 23, 2002 6:38 am

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 that OA owe them millions in landing fees. Face it, the airline brought about its own demise. It has suffered from corrupt management and corrupt employees (why, oh why are employees spending two weeks in Australia on the airlines dime). The most humane thing to do is to let the airline die and start from scratch.
Hughes Airwest - Top Banana In The West
 
mrman_3k
Posts: 140
Joined: Thu Feb 01, 2001 7:36 am

RE: Greece Tries To Keep Olympic Air Aloft

Sat Feb 23, 2002 7:12 am

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 you could call it an American or western European style of 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 then go back to work for several more hours, somehow that does not seem productive.

Just my 2 cents, do not take this personal as in my opinion it is the absolute best "feel-good" system, just not very productive.
 
0A340
Posts: 262
Joined: Tue Nov 21, 2000 3:10 am

RE: Greece Tries To Keep Olympic Air Aloft

Sat Feb 23, 2002 7:12 am

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 been thrown in in the last 10 years, trying to 'fix' this airline. Another 150 M Euros are needed for the newest 'reorganization plan'. Of course, no-one is going to be held accountable if this won't work, once more. The only thing we get to hear all the time is the "unanimous agreement" of the Gov. Ministers that this time it is going to work...

My 0.02 E
 
Konstantinos
Posts: 364
Joined: Mon Jun 25, 2001 5:29 am

RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 28, 2002 3:21 am

"...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 then go back to work for several more hours, somehow that does not seem productive."

Dear mrman_mk, Things are not as you think. Infact they send to work more like 12 hours and get payed for only 8 hrs and many times they don't even get lunch breaks. The main problem is the management.
 
LJ
Posts: 4103
Joined: Wed Nov 17, 1999 8:28 pm

RE: Greece Tries To Keep Olympic Air Aloft

Thu Feb 28, 2002 3:35 am

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 employees for a hard restructuring plan and that in the end the government gives in to the employees.

BTW didn't the Greek government vowed not to help OA this time? If my recollection is good, some Greek government officials made it absolutely clear they wouldn't bail out OA this time and if the privatisation talks collapsed (like they did) it would mean bankruptcy. Apparantly for an unknown reason they had to withdraw that idea

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