White Eagle swoops in on LOT's market

White Eagle Aviation (WEA), the biggest challenger to Poland's national airline, has boosted its share in the charter market to nearly 30% so far this year, said Ryszard Niemczycki, WEA's owner. "The market has dropped, but we will make a profit this year," he said. Last year, he predicted that the firm would break-even in late 2002 and make a profit in 2003. WEA was launched in the mid-1990s as an air taxi company and started international flights in 2000, when it rented its first Boeing 737 and began to operate charter services to summer resorts in the Mediterranean region. While WEA has about 30% of the charter market, the market share of dominant national carrier LOT Polish Airlines has shrunk to some 40-45% this year, said Joanna Wysocka, WEA's spokeswoman. The remaining 30% is shared by about a dozen foreign airlines. WEA's swelling market share follows a surge in the carrier's passenger numbers, she said.

LOT said its share remains above the 50% mark, but its deputy spokesman, Andrzej Kozłowski, wouldn't dispute WEA's estimates. WEA predicts it will carry some 260,000-280,000 passengers this year. About 796,000 travelers flew charter flights from Poland in 2001, and LOT forecasts that this figure will rise to about 807,000 this year. WEA added a second Boeing 737 to its fleet last year and a third aircraft this season. The three-Boeing fleet is only one plane less than the four Boeing 737s operated by LOT in the charter segment. Niemczycki's WEA has been 29.3% owned by the German travel giant Preussag since last August. "Despite a crisis in airline traffic, we recorded a 40% rise in the volume in the first half of 2002 vs. the first half of 2001," Wysocka said.

Preussag's capital involvement played an instrumental role in WEA's rise as the Germany-based concern owns two of the five biggest travel operators in Poland - TUI and Scan Holiday. The alliance with Preussag has given WEA a preferred position as a transport supplier to the two firms, Niemczycki said. The travel operators' shift to WEA has hurt LOT's charter numbers. While TUI and Scan Holiday provided LOT with 43% of its charter travelers in 2000, the share has fallen to 11%, according to LOT estimates for this year. But LOT still carries some 90% of tourists served by Poland's biggest travel operator, Neckermann, according to Krzysztof Piątek, Neckermann Polska's president. "With WEA, we only fly to Morocco," Piątek said. Despite its success in the charter market, WEA isn't going to move into the scheduled traffic segment in the foreseeable future, Niemczycki said.