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Aegean CEO Shares His Thoughts

Star Alliance integration will help Aegean in turbulent times

Luc Citrinot, eTN  Jul 01, 2010

ATHENS (eTN) - Greek carrier Aegean Airlines officially became Star Alliance’s newest member. And for the airline, it is a rather good timing as the airline is affected by the Greek economic downturn and faces the prespective to merge soon with Olympic. “We will get a lot of benefits for us and for our customers as we will be able to propose a global offer with a strength of the World’s largest alliance,” said Dimitris Gerogiannis, Aegean CEO. At the inaugural ceremony, Star Alliance CEO Jaan Albrecht emphasized that Aegean integration was not only a commitment but a motion of confidence into Greece. “We are happy to welcome a highly dynamic, prestigious carrier such as Aegean. And we are glad that Star can now call Greece its home market,” he said.

Star’s support to Agean will help the airline to get more exposure worldwide and to soften the consequence of the economic crisis. “After seven consecutive years of being profitable, we will face a challenging year due to [the] Greece situation with demand slowing down. However, our goal is to show a profit next year,” added Mr. Gerogiannis. To retain our profitability, we plan further cost-saving measures. But we are lucky to have a lot of cash reserve. It will help us to go through an economic crisis, which might last for a couple of years.”

Aegean will also face another important challenge by merging with Olympic. The merge has not yet received the green light of the EU competition commission and from various Greek institutions. “Once the procedure [is] approved, it would probably take another year before the merger is fully implemented,” forecasted Mr. Gerogiannis. The Aegean CEO remains confident that the merger will be accepted. “The size of Greece is a fifth of France, Spain, or Italy. But we still have two full-service airlines when other countries have only one,” he added. The new structure will retain the name “Olympic” as the brand is better known, than Aegean, despite sometimes having a bad reputation abroad. “Developing a new brand culture is not the biggest problem. Our main concern is the financial situation of our country,” told Mr. Gerogiannis.

According to the CEO, Aegean success has been largely built on a very prudent development of the airline, which helped to grow its network from 22 to 37 destinations between 2006 and 2010 and increase its passengers output from 0.31 million the year it started to almost 6.6 million last year. “We grew but always within our own abilities as we are able to recognize to know what we can deliver. We will then probably continue to consolidate our business in 2011 by concentrating on medium short-haul markets,” added Mr. Gerogiannis.

Star Alliance integration will help Aegean in turbulent times
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