Pashinyan: Fly Arna airline could not withstand competition in air  carriage market

ArmInfo. Fly Arna airline, in fact, could not withstand competition in the air carriage market. RA Prime Minister Nikol Pashinyan stated on March 20 during government hour in the National Assembly of the Republic of Armenia, answering a question from MP from the ruling "Civil Contract" faction Arsen Torosyan.

The MP, in particular, asked about the reasons for Fly Arna leaving  the market, and what conclusions were drawn from the experience of  airlines with state participation, the authorized capital of which  was allocated 4.8 billion drams were allocated.

Answering the parliamentarian's question, Pashinyan recalled that  during the pandemic, many airlines stopped operating flights to  Armenia, including Ryanair, Wizz Air and others. Then, as Pashinyan  noted, a decision was made to establish  a domestic airline, the  management of which was entrusted to a major player in the air  transportation market. However, later the market situation changed  somewhat, new companies appeared, which led to the fact that the Fly  Arna airline, in fact, could not withstand competition in the air  transportation market.

The Prime Minister also emphasized that serious developments took  place during this period. In particular, European airspace was closed  to Armenian civil aviation, since the EU included Armenian carriers  in its "black lists," which, according to Pashinyan, is a bad story.  Now these points are being studied. The Prime Minister recalled the  law that was adopted by the National Assembly and concerns payment  for services provided by the RA Civil Aviation Committee. This is  done to enhance the Committee's ability to attract qualified  personnel. "There is hope that very soon Armenia will leave the EU  "black list," said the head of the Armenian Cabinet.

Yesterday, Deputy Minister of Territorial Administration and  Infrastructure of the Republic of Armenia Armen Simonyan said that  Fly Arna airline had suspended its activities in the air  transportation market for financial reasons. According to him, the  airline's license has been suspended. The fact is that, according to  the current legislation in Armenia, if an air carrier does not have  at least one aircraft, the license is suspended for up to six months.  If there is no airliner after six months, the license will be  completely terminated. "The situation with Fly Arna is being studied  and if relevant information is available, taking into account  commercial secrets, it will be made available to the public," the  deputy minister assured. 

Earlier, ArmInfo, citing sources in Fly Arna, reported that the  airline intends to leave the Armenian air transportation market. The  company recalled its two planes. The reason for the recall and  cessation of activity, as the source noted, was the failure of the  Armenian side to fulfill the terms of the agreement on the  establishment of the airline, one of which was the subsidization of  passenger transportation by the RA government. 

Notably, on December 10, 2021, Armenian National Airlines CJSC  received state  registration. The company operated under the Fly Arna  brand -  ARmenian National Airlines. The project to create a new  airline  became known in July 2020, when the then-current executive  director  of the Armenian National Interests Fund (ANIF) David  Papazyan and the general executive director of the budget airline  based in Sharjah,  Arabia, Ali al Ali, signed an agreement. ANIF  proposed to announce a  competition for the best name for the new  airline. Based on the  results of the competition, it was announced  in September what it  would be called. Initially, it was known that  the company would  operate on a low-cost business model, in other  words, it would be an  Armenian low-cost airline (such airlines offer  passengers low prices,  but at the same time an incomplete, that is,  not generally accepted,  list of services).