Friday, 21 September

Georgian Connection: Is Former Armavia Owner Baghdasarov Getting Back in the Aviation Business?



Recent news reports say that Mikhail Baghdasarov, former owner of the now defunct Armavia Airlines, has been offered a position with Georgian Airways.

The businessman leaked the news himself to the Armenian periodical NewMag. In the spring of 2013, when Armavia (then the flag carrier of Armenia) was going under, Baghdasarov hinted at getting back in the aviation business in an interview with eMedia.am.

When asked if he thought that Armavia would ever get back on its feet, Baghdasarov responded:

-Nothing can be ruled out in this life. My return can be ruled out, but Armavia may return. I no longer want to be involved in aviation. It’s a thankless occupation, even if conditions change. I believe the sector will do fine without me. I’ll find a less stressful business for myself.

-Hopefully here in Armenia.

-It all depends on the business. It’s possible here or overseas. Most likely overseas. I’ll retain some interests here, but of course not in aviation. It’s no secret that the numbers of people leaving [Armenia] have increased. So why can’t I be one of them? Secondly, it’s not I’m just leaving. It’s just that I’m doing business elsewhere.

So, is Baghdasarov getting back in the aviation business or not despite previous claims that it’s a ‘thankless occupation’?

Interim Georgian Airways Manager Robert Oganesian told sputnikarmenia.ru that there was no truth to the allegations that Baghdasarov would be working for the company.

We should note that Baghdasarov has strong ties with Georgian Airways dating back to when Armavia was operating. In fact, Baghdasarov told reporters in July 2011 that he was planning to purchase Georgian Airlines and that negotiations were ongoing.

Georgian Airways, founded in 1993 under the name Airzena, started flying a year later. In 1999 Airzena merged with Air Georgia to become Airzena Georgian Airlines. That same year, the company became the flag carrier of Georgia. In August 2004, the company changed its name to Georgian Airways. Today, Georgian Airways is a fully privately owned company, with a fleet of six modern medium-haul Boeing 737 and CRJ aircraft. Based in Tbilisi International Airport, the airline also operates flights to Yerevan.

Former Armavia employees are very familiar with Tamaz Gaiashvili, President of the Georgian Airways Board of Directors.

He was listed as one of the top 80 richest Georgians in 2012 by The Georgian Times with assets totaling some US$40 million.

During Baghdasarov’s stint as owner of Armavia (2005-2013), the Armenian and Georgian national carriers closely cooperated. From 2007-2009, Armavia operated its first Boeing 737-300 aircraft (4L-TGL) that was leased from Georgian Airways. The flight and cabin crew were from Georgia.

  Armavia’s Georgian Boeing Aircraft (Frankfurt, June 6, 2007)

In 2009, Armavia leased another aircraft (Canadair CRJ 200LR - EK-20073) from the Georgian company. Given that Armavia soon purchases a similar craft, the plane was returned.

The EK-20073 over Zurich (August 6, 2009)

The Georgian company later attempted to lease aircraft to Armavia on two separate occasions but the deals fell through.

Interestingly, last year then Georgian Airways General Director Iase Zautashvili publicly complained about Georgia’s “Open Sky” policy, describing it as one of the major challenges facing the company. Zautashvili argued that it had given an unfair advantage to Russian companies.

Under the policy, in 2014 Georgia gave 13 Russian companies permission to enter the country. Each was allowed to conduct 14 flights a week between Moscow and Tbilisi. (Direct Tbilisi-Moscow-Tbilisi flights were cut after Russia and Georgia clashed in the August 2008 war. Since 2011, Georgian Airways and Russia’s Sibir Airlines have carried out direct charter flights to various cities between the two countries, including Tbilisi and Batumi.)

In late 2014, in a sign of protest, the Georgian carrier temporarily suspended flights to Moscow and threatened to do the same for other destinations. Shortly after, however, the airline resumed all flights since Georgia’s aviation authorities agreed to strike parity regarding the number of flights to be operated by Georgian and Russian carriers.

Another demand set forth by Georgian Airways is that it wanted to regain its status as the country’s national carrier. The authorities never responded to this request.

In essence, both in Armenia and Georgia, Russian carriers are the first to benefit from the West’s much ballyhooed Open Sky policy.

With their large pool of resources these Russian carriers are able to gobble up local markets while shunting aside domestic national carriers.

Top photo: Mikhail Baghdasarov, Tamaz Gaiashvili


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