Local
articles | 11 April 2016

Cobalt Airways set for June 2016 take-off

A new upstart airline is aiming to revolutionise the local travel market by launching low-cost flights between Cyprus and far-flung destinations, including China.

Cobalt Air is set to roll out entirely new routes to Europe, Asia and the Middle East using an initial fleet of five Airbus jetliners.

“We are launching in June, right into the summer peak. That date is not going to shift; we are well on track for that launch,” CEO Andrew Pyne told the press this week.

Despite already being dubbed the ‘new unofficial national carrier’, Cobalt insists its model is based on low-cost efficiencies and bears no relation to the now-defunct Cyprus Airways.

The company – which has set up office in the Artemidos Tower near Larnaca Airport – already has over 100 staff on the payroll and will take delivery of their first plane next week.

Cobalt is owned and controlled by Cypriot nationals, but has a significant Chinese investment component.

In his first major interview about the project, Pyne said Cobalt is not attempting to poach traffic from full-service or low-cost carriers – but is focused on generating new traffic, new destinations and developing a ‘Cyprus hub’.

“In reality there are dozens ofairlines we will be competing with. We are certainly not going out of our way to target other airlines as a competitor or to snatch traffic from them. None of the carriers like Aegean, Blue Air or RyanAir, Wizz have any interest in developing a hub here.”

For now, the company is keeping the scale of ticket fares under wraps, but insist they will operate a low-cost model ‘with a twist’.

“I regard myself as a low cost expert, a specialist,” Pyne said. “But there are a dozen ways we will differentiate ourselves from other low cost airlines.”

Extensive details about bookings, destinations, in-flight entertainment, taxes and baggage allowances will be divulged in a press conference next month.

Pyne says the company is looking to link Cyprus with destinations where connectivity has been reduced or is non-existent – in addition to linking the ‘untapped areas’ in the Middle East and North Africa through Larnaca into Europe.

“This is something no airline has done effectively before, it’s a new concept. It really is focused on developing Larnaca as a genuine hub for the entire region,” he said.

Pyne would not be drawn on media speculation or online chatter that Cobalt would serve cities across the UK and Ireland, but did acknowledge that it was a “reasonable bet, as it’s a huge market”.

“Russia and the UK generate a vast amount of inbound tourism, the UK has a more balanced route as there are lots of Cypriots with links to the UK and there is a British expat population. So I think we can’t ignore those markets.”

China

The company is also throwing its weight behind a full service to China, which is experiencing a rapid rise in air travel.

“Cobalt is looking at delivering a ‘dramatic impact’ in Chinese tourism arrivals to Cyprus,” Pyne says. “China, as we have already indicated is a big part of the plan going forward. I think it is very dangerous to be too niche in how you target the market. Obviously we are interested in boosting Cypriot tourism by bringing holidaymakers into Cyprus and a big part of our strategy is to target new markets.”

Pyne says the Chinese economy is one of the biggest in the world, and amid its population of over one billion – is a growing middle class keen to travel.

Cobalt services to China will be scheduled and could run as frequently as three to four times a week, but Pyne ruled out Shanghai and Beijing as destinations.

“These are hugely expensive airports and they are heavily serviced by the likes of Emirates and Qatar. So, we are looking to go to the ‘B set’ of airports in secondary cities – which in some cases have populations of 5-10 million people,” he said.

“We are hoping to start China services early in 2017. We have some Chinese investment in the company and so there are clear links to China. Also, China clearly looks at Cyprus as a key strategic investment opportunity in the region.”

Cobalt is hoping to cash-in on the known spikes in the Chinese outbound travel market, which includes Chinese New Year, the May Day holidays and the National Day holiday in October.

“In between with 1.5 billion people, you still have a lot of outbound travel, the ambition is to get tourism numbers up to the six-figure region – we will be using the Airbus 330, with up to 350 seats.”

Cobalt say a critical element of driving Chinese tourism to the island lies with the government modernising the existing ‘cumbersome visa system’ to being able to process applications online, similar to the process introduced for Russians.

“Getting a streamline visa process is very important. We have pushed this point to the government and the CTO is running a mission to China in May, we would like to be part of that.”

Iran

In addition to China, the carrier has already made inroads into Iran, which has a large and growing economy.

A Cyprus-Iranian Business Association was established last year, in another important step in expanding business and investment opportunities between the two countries, particularly now that most international sanctions against Iran have been dropped.

“We have made it very clear to the government that we want a big slice of the action to Iran – and we have also said, we are not just interested in Tehran, we are also interested in other Iranian cities.

“It will be done and it will be done this summer.”

Airport taxes

Unlike Ryan Air, which have been openly critical about high airport taxes in Cyprus, Cobalt say their concern is with handling charges at Larnaca.

“We have some serious concerns about the handling charges at Larnaca. This is not the airport authorities or Hermes, but that there is a duopoly of two handling agents – and they both offer pricing which is very close to each other, so I think there is a case for more competition in that market,” Pyne added.

When it launches will become the second new airline to take off this year. TUS airways, which is also based at Larnaca, is already running regular flights to Tel Aviv and Haifa.

The airline aims to connect Cyprus with neighbouring countries via short-haul frequent flights on a daily basis, serving both business and leisure travellers.

Source: Cyprus Mail

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