Hugely increased costs at the new Athens Spata airport are set to compound financial problems at Olympic Airways, which is already facing spiralling debts and may have to resort to wage cuts in the near future.
Increases in landing, take-off and parking fees, plus higher rents, will cause Olympic's bill for services to rise to 22 billion drachmas per year ($57.22 million) from next March, when Spata, its new hub, becomes fully operational, compared with annual fees of 1.5 billion drachmas at Helliaikon airport.
The charges will be payable to the new Athens International Airport firm, co-owned by the Greek Government and German construction company Hochtief which is building the airport. Non-Greek airlines set to use Spata are also displeased, and Hochtief is understood to have offered three options: cheaper rates in exchange for a contract to run the airport beyond the agreed 25 years; a greater share of passenger tax; or a tax take beyond 2015.
The European Commission has meanwhile approved the financing of Olympic's move to Spata, allowing 67 million drachmas in state aid remaining after the purchase of four Airbus A340-300s to be spent on the move. With Spata - to be known as Eleftherios Venizelos in honour of a former Greek prime minister - due to be inaugurated this week, IATA officials and representatives of 48 airlines will make a visit to evaluate its services and infrastructure, amid speculation that the move may be delayed beyond 1 March next year.
Rising fuel prices and the weakening drachma mean Olympic's expenses for the current year will increase by at least 20 billion drachmas, taking costs to 50 billion drachmas and prompting the threat of salary cuts. Athens is now considering a plan to split the airline in two, with one part carrying the debt and the other to be privatised next year.
Olympic is also out of favour politically after two recent operational incidents. One involved a Boeing 747 carrying the Greek prime minister, which was refused permission to overfly Yugoslavia due to an "incorrect application". In the other, an Olympic-operated VIP Dassault Falcon 900 plunged 18,000ft in September last year, killing the Greek foreign minister.
Olympic's operational and engineering departments were in part blamed for the latter incident. General manager operations Capt Miltiades Tsangarakis and general manager engineering Apostolos Kayias have been replaced. Olympic's president and chief executive officer, Dionissis Kalofonos, was appointed only a few months ago, but is reportedly under pressure to resign due to the airline's ills.
· Golden Sun Holidays has purchased a 43% stake in Greek start-up Galaxy Airways, increasing its capital to 3 billion drachmas. Golden Sun specialises in package holidays from the UK to Greece and Cyprus. Kavala-based Galaxy, which is majority-owned by Xifias Fisheries, was founded last year and expects to see passenger numbers increased by 250,000 as a result of the deal. It operates two Boeing 737-400s and a 737-500.
Source: Flight International