With little sign of respite from competitive and economic pressure, many of Europe's second tier carriers have embarked on a fresh round of restructuring actions aimed at ensuring their survival.
There has been rethinking necessary in Greece, where the two principal carriers have been licking their wounds after the European Commission in January blocked plans for Aegean Airlines and the reinvented privately owned Olympic Air to merge.
While Olympic says the two carriers plan to appeal against the EC decision, it also embarked on a major shift in strategy that will see it pare back its fleet and scrap several western European destinations in a bid to focus on south-east Europe.
© Philippe Noret/AirTeamImages.com
It is adding six new domestic flights and will maintain or expand services on eight international routes - but axe flights to Brussels, London, Paris and Vienna - the first three of which it had been competing on with Aegean Airlines.
In June we launch the first Developing Sustainable Aviation Strategies conference in London. Find out more about this event here.
"However, our central and non-negotiable target remains to provide the highest quality services to our passengers, while the reorganisation of our network will allow us to address more effectively the challenges that surround us and to maintain the leadership profile of Olympic Air in our region."
WEAK DOMESTIC MARKET
Meanwhile its consistently profitable rival Greek carrier Aegean Airlines posted a net loss in 2010 of €23.3 million ($32.6 million) and, amid weak domestic consumption and higher fuel prices.
"The challenges of the acute recession of the Greek economy and the significant rise in the price of fuel, will continue to affect the company's results during the current year," adds Aegean Airlines managing director Dimitris Gerogiannis.
Two of southern Europe's island carriers have also found themselves under pressure, as competition from low-cost carriers increases. Cyprus Airways revealed a small net profit of €200,000 for 2010, but this was bolstered by a one-off €20 million payment from the Cypriot government in compensation for an ongoing ban on its flights through Turkish airspace.
The carrier intends to lease out one of its two Airbus A330-200s and axe up to 140 jobs in an attempt to reverse losses
Air Malta meanwhile, which in November was cleared for €52 million in temporary rescue aid, is in the midst of a restructuring. Ernst & Young was recruited to help revamp the carrier, but initial proposals have met with concern from unions of large-scale redundancies. Indeed the Airline Pilots Association of Malta is working on its own proposals for the airline if agreement is not reached
ALPA Malta president Dominic Azzopardi says the carrier, which operates 10 Airbus narrowbodies, needs new aircraft. This fleet was planned 10 years ago, but with carriers such as Ryanair and easyJet eating into routes, Azzopardi believes they are now too large for Air Malta.
"We either have to diversify to other routes where Ryanair does not fly, or else get smaller aircraft for destinations where Ryanair and easyJet do fly," he says.
Elsewhere European Commission regulators have opened a probe into whether a restructuring plan for Czech Airlines, which includes bringing the SkyTeam carrier and the operator of Prague Airport under a single state-run holding company, breaches EU competition rules.
In December, the EC launched a similar investigation into restructuring at Hungarian carrier Malev.
But for one carrier the immediate news appears brighter, as TAP Portugal posted a record net profit of €62.3 million for 2010, particularly timely given moves to privatise the carrier this summer.
A number of airlines have been linked with a possible move for the carrier, including Qatar Airways and the LAN-TAM grouping.