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The Slovenian government is considering revising its airline subsidy program in an effort to enhance the country’s air connectivity, while the possibility of launching a new national carrier remains on the table. The Ministry for Infrastructure has indicated that policy changes could follow the adoption of Slovenia’s new aviation law, expected later this year. This development comes after seven public tenders aimed at boosting connectivity received a mixed response from airlines. An eighth tender is currently in progress. So far, only 494.376 euros of the allocated 16.8 million euros has been spent, with Luxair, airBaltic, and Norwegian being the only carriers to benefit from the scheme.
Addressing the issue, the Ministry for Infrastructure said, “The Act on Aid for Ensuring Greater Air Connectivity, on the basis of which the current public tender is being implemented, will apply until October 5, 2025, i.e., until the new Aviation Act (ZLet-1) comes into force. After this date, it will be possible to notify the European Commission of a new financial aid scheme with a duration of up to three years and conduct a new public tender on the basis of ZLet-1, so the Ministry of Infrastructure is considering a possible continuation of the measure”. It added, “In addition to conducting the public tender, it is also intensively studying options that will improve Slovenia’s air connectivity in the long term, as we are aware of the short-term effects of a time-limited public tender. We are open to various forms of cooperation with airlines that would help increase air connectivity in Slovenia in the long term and we are interested in discussing possibilities for cooperation. Discussions with carriers that present their proposals for improving Slovenia’s connectivity are ongoing, but there are no concrete proposals for cooperation at this time “.
The Ministry emphasised that the creation of a new national airline remains a possibility, however, any decision on the matter will require a collective agreement by the Slovenian government. In July 2023, the Slovenian Parliament’s Public Finances Oversight Commission proposed for the state to enter into a strategic partnership with an established airline in the process of forming the country’s new national carrier. Acknowledging that the process of setting up a new airline could take several years, the government has previously said it would only do so through a Public Private Partnership (PPP).
Grant Thornton Advisory, which was commissioned by the Slovenian Ministry for Infrastructure to undertake a study on ways to improve the country’s air connectivity, concluded that launching a new flag carrier could be economically viable. According to the study, at least 300.000 passengers from Slovenia are using alternative airports outside of the country for their travels. The study found that in the case of a PPP, the national airline would break even in its seventh year of operations. The cumulative loss in such a case would reach 35 million euros in the sixth year, and after the tenth year it would amount to 28 million euros. The authors of the study estimated the private partner would have to make an initial capital injection of at least 35 million euros, or seventy million euros in the case of a more ambitious network.
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