Tenders submitted by three bidders for air routes to Estonian islands

BMI plane on the tarmac at Tallinn Airport. (ERR)
5/2/2016 11:43 PM
Category: Business

Just over three weeks after a procurement was declared for a new airline to serve Estonia’s domestic Tallinn-Kärdla and Tallinn-Kuressaare routes after a license suspension revoked flying privileges from the previous airline serving them, three bidders have submitted tenders for the routes, all of which qualified.

The procurement was declared by the Ministry of Economic Affairs and Communications on April 8, seven days after the Estonian Civil Aviation Administration (ECAA) revoked domestic airline Avies’ Air Operator Certificate (AOC), thereby immediately rendering the airline unable to continue to fly. Avies had previously been serving regular routes between the Estonian capital of Tallinn and Stockholm, Kuressaare in Saaremaa, and Kärdla in Hiiumaa.

According to the ministry, anyone with a valid Air Operator Certificate (AOC) and Operational License was welcome to apply to the procurement.

The committee formed to handle the airline procurement also included the county mayors of Hiiumaa and Saaremaa in order to guarantee representation of local opinions on the matter. While the procurement officially continues, talks with bidders are slated to begin this week.

According to Taivo Linnamägi, head of the ministry’s Aviation and Maritime Department, the most important condition involved is price. Linnamägi added, however, that “It is important to own at least one 19-seater plane, as well as offer Estonian-language service; all other details are negotiable."

Nordica has considered renting the necessary supplementary aircraft if its submission for the two air routes’ tender should win. Jaan Tamm, a member at the board of directors of Estonia’s new flag carrier airline, admitted that this really couldn’t be some sort of big and profitable venture; that it was moreso a labor of love.

Airest, which had also the submitted a tender to the economic ministry’s procurement, has already counted on the fact that if current rates and passenger volume remained similar going forward, they would just about break even, but if things went well, they could up in a position to profit from the relatively short air travel routes as well. The company doubted its ability to offer customers the most competitive pricing, however.

“[The procurement] requested a minimum of one 19-seat airplane, and price was cited as most essential criteria,” explained Jaanus Ojamets, head of airline Airest. “Because our plane is a 33-seater, we have clearly not been in a position to offer the lowest prices.”

The third airline to submit a tender was Lithuanian airline Transaviabaltika, who has previously also rented an aircraft to the now-suspended Estonian airline Avies.

The Ministry of Econmic Affairs and Communication will sign a contract to tender approximately three years in length with the winning bid of its current airline procurement, the more exact details of which will be discussed with the contractor and the winning bidder.

Technical specifications of the procurement included 12 flights per week on each of the two lines from Tallinn to the Estonian islands, and that the planes themselves serving these routes could seat 19 or more passengers at once.

The Ministry of Economic Affairs and Communications hopes to have air service to the islands restored before the two-day Midsummer's Day national holiday in late June.

Editor: Aili Sarapik

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