Airport, EU – Baltic States, Lithuania, Tourism, Transport

After having been addressed by Air Lituanica as external consultants, the experts of Lufthansa Consulting having a long-term international experience carried out a performance audit of Air Lituanica in October 2014. The conclusions emphasise that the cost structure of Air Lituanica is effective and rational, given the company’s size, type of operation and its duration.

The conclusions of Lufthansa Consulting state that Air Lituanica has one of the most effective cost management structures among European regional airlines. They emphasise that the company’s financial performance is determined by variable income, however the routes for passengers travelling by air on business-related matters are likely to generate higher income during the winter season. Lufthansa Consulting and Air Lituanica are currently developing a detailed revised business plan for Air Lituanica for 2015-2025 to be presented to the Council of Vilnius City Municipality at the end of December.

The company’s operation was also positively assessed by Invest Lithuania. In September 2014, experts of Invest Lithuania analysed the compliance of Air Lituanica’s flights with the needs for target routes and the economic and social benefits. Flight directions provided for in the business plan were found to mostly meet the market needs. Priority markets and certain foreign investment attraction target markets provided for in the inbound tourism strategy for 2014-2020 are reflected in operation and future plans of Air Lituanica.

According to data of the State Department of Tourism of Lithuania and Ernst & Young Baltic, the estimated contribution of Air Lituanica to the inbound tourism amounted to over LTL 45 million – expenses of the company’s passengers arriving in Vilnius for various services. Research performed by Ernst & Young Baltic show that for airline companies, 1 passenger service cost average to LTL 631, 46% of which go to service providers in Lithuania. The State Department of Tourism of Lithuania has calculated that average spending of a foreigner in Lithuania per trip is LTL 1,242. Around 48% of the travel budget is spent in restaurants, 33% – for accommodation services, 19% – for transport. The average travel duration of one inbound passenger is 4.4 nights.

According to the calculations of the Airports Council International, the overall contribution of the air transport to the Lithuania’s economy is quite solid – almost 12 thousand jobs and EUR 420 million of the gross value added. One million passengers create almost 3 thousand jobs (directly – 950), therefore Air Lituanica has already indirectly created about 100 new jobs during the operation period. In 2013-2017, local airlines providing economic benefits could add up to LTL 256.6 million to the national budget, i.e. the annual average of LTL 51.3 million.

The airline Air Lituanica has carried 150 thousand passengers during fifteen months of operation. Air Lituanica operates flights from Vilnius International Airport to major airports of Amsterdam, Brussels, Berlin, Prague, Munich, Paris, Billund, Tallinn and this summer it operated seasonal flights to the cities in Sweden, Göteborg and Malmö. From 26 January Air Lituanica will start operating flights to Stockholm. During the major holidays of the year, from 19 December to 4 January, Air Lituanica will offer direct flights from Vilnius to London, Edinburgh, and Gothenburg. Air Lituanica flights are operated by 86-seat Embraer 175 and 49-seat Embraer 145 aircraft.