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11 January / 2019

Denial of mass media information

Aurora Airlines, being a subsidiary of Aeroflot, denies information, published on January 2, 2019 on the ASTV website that "in 2019 Aurora will not perform flights on the subsidized routes". The journalist of ASTV misrepresents information of Federal Air Transport Agency and makes an incorrect conclusion that Aurora will not perform flights on the subsidized routes. In fact, Aurora Airlines performs flights on the subsidized routes and plans to continue perform flights on the subsidized routes in 2019. However, the number of such routes has decreased because of insufficient subsidies.     

For information, there are the following types of subsidized flights in Russia:

- regional - flights between administrative regions are subsidized in accordance with the Decree of the Government of the Russian Federation No. 1242, by the Federal Air Transport Agency and with the consent of the administrative regions - co-financed from the regional budget;

- intraregional - flights on the territory of the administrative region are subsidized by its budget.

Regional flights

In accordance with the Decree of the Government of the Russian Federation No.1242, during the nine months of 2018, Aurora Airlines performed flights on subsidized routes. However, within the framework of the program, subsidized flights in the Far Eastern Federal District are deeply unprofitable. Expenses, including prices of aviation fuel, continue to grow, at the same time the rate of subsidy has not changed for more than 5 years.

Aurora repeatedly made proposals to the Ministry of Transport of the Russian Federation, the Ministry for Development of Russian Far East, and the Federal Air Transport Agency to make changes to the current version of the Decree of the Government of the Russian Federation No. 1242 of December 25, 2013 that will allow to remove flights to profitability within framework of this program, to increase a passenger traffic and to provide transport availability.

These proposals were not accepted, for which reason Aurora was forced to make a decision to cancel flights. Thus, flights from Khabarovsk to Tynda/Neryungri/Shakhtersk and on the route Yuzhno-Sakhalinsk - Petropavlovsk-Kamchatsky were canceled from October 1, 2018, and on the route Khabarovsk - Nogliki from October 28. Commercial tariffs with a minimum cost were established on the routes Yuzhno-Sakhalinsk - Blagoveshchensk and Khabarovsk - Okha.

Aurora canceled subsidized regional flights between administrative regions because of unprofitability of flights, but keeps full readiness to return to these routes in case of increase of the rate of subsidies. 

Flights within the Sakhalin Region and the Primorsky Krai

According to the decision of the Government of the Sakhalin Oblast, from January 1, 2017 the mechanism for subsidizing of intraregional transportation has changed. The Decree of the Government of the Sakhalin Region No. 571 of 15.11.2016 "On the tariffs for transportation of passengers, baggage, mail and cargo by sea and air transport", paragraph 2 of a note to Annex №1 determines the levels of the basic rate (tariff) for citizens, residing in the territory of the Sakhalin Region. In particular, for passengers who have permanent registration in the territory of the Sakhalin Region, the cost of flighton the route Yuzhno-Sakhalinsk - Okha - Yuzhno-Sakhalinsk is 13,900 rubles (round trip). For citizens who do not have permanent registration in the territory of the Sakhalin Region, the tariff on this route has increased by more than three times - up to 38,200 rubles. As a result, passenger traffic decreased for 13%. 

Aurora came out with a proposal to the Government of the Sakhalin Region to return the former procedure of subsidizing that will allow to establish a single tariff for all categories of passengers on an acceptable tariff and to increase passenger traffic.

Today there are remain available tariffs for citizens of the Sakhalin Region on the routes - Yuzhno-Sakhalinsk - Okha/Kurilsk/Yuzhno-Kurilsk, in one direction - 6950 rubles to Okha and 5950 rubles on both Kuril's directions. 

Aurora’s domestic flights in the Primorsky Krai have one of the cheapest tariffs in Russia. The rate of a tariff varies from 700 to 2000 rubles in one direction, depending on the direction. Is is not an action, not seasonal discounts, but one tariff all year round for all categories of passengers. The intraregional flights in the Primorsky Krai are performed on DHC-6 aircraft.

Due to subsidy program of the Primorsky Krai, the cost of flight is accessible for population. All conditions are created to ensure an acceptable level of tariffs without loss for carrier in Primorsky Krai.

Also, in the Khabarovsk Krai, from June 1 of last year, flights on the subsidized route - Khabarovsk - Nikolayevsk-on-Amur were successfully launched. 

Thus, intraregional flights in the territory of the Primorsky Krai, the Khabarovsk Krai and in the Sakhalin Region continue and are not suspended.

The Far East is a huge territory where relatively few people live. Small population density, small passenger traffic, low income - we are talking about social transportation, where without government assistance the tariff becomes "exorbitant". The tariff depends on the cost of work (aircraft, weather, kerosene, airport, salary, office rent, etc.). Interregional and local air transportations are just in the non-payable segment, these are social flights, where government assistance is needed. 

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