The newspaper "Kommersant" under the heading "There can't be a low-cost airline in such a situation." The ex-head of Pobeda, Andrey Kalmykov, about his resignation, sanctions and ticket prices," published an interesting interview with the former CEO of the low-cost airline Pobeda (part of the Aeroflot group) Andrey Kalmykov on the prospects for the existence of Russian civil aviation in the conditions of total Western sanctions imposed against it.
(c) Evgeny Egorov / Vedomosti
Russian aviation, one of the first to come under extremely harsh sanctions, is radically changing working conditions. Mikhail Poluboyarinov, the head of the country's largest Aeroflot, and Andrey Kalmykov, the CEO of the Pobeda low-cost airline, almost immediately left their posts, who told Kommersant about the reasons for his departure, plans for the future and prospects of the aviation industry.
- Did you have a hard time parting with "Victory"?
- Live. It was cut to the quick without anesthesia. With meat escaped.
- How, when and why did you decide to leave?
- It was a difficult, but absolutely balanced decision. Now airline executives are faced with completely different tasks. My experience and knowledge are not needed now. In a situation where a flight to Sochi takes 4.5 hours and fuel costs 60 thousand rubles per ton, we are no longer talking about effective problem solving, it is solely a matter of ensuring transport accessibility, connectivity at any price, regardless of cost. So that the country continues to fly. This task is much easier, so it will be handled without me.
- Is it easier?
- Of course, if you don't have to fight for efficiency, it's easier for the manager in this sense. It will be more difficult for technicians and engineers now, because without access to engineering centers, technical solutions ... it will not be easy for them.
- Will there be a solution, do you think?
- I don't know. The situation is changing so fast that it is very difficult to make any forecasts.
- If you were not a top manager of the company, but an owner who cannot quit, what would you do?
- An unenviable role, I tried to try it on myself - my close friend owns an airline - but I couldn't. Even when you are a manager in someone else's business, it is very painful to make all these decisions (about leaving.- "Kommersant"). And when what you founded collapses in front of my eyes, I can't imagine these emotions.
- When did you make the decision? On February 24 or immediately after the announcement of sanctions?
- No, February 24 was my birthday, and of course I have never had such a birthday before. I was on vacation, but my team and I immediately began to calculate possible options and the scale of sanctions, as well as their impact on the company.
On March 2, I returned to Moscow, by this time everything was already clear - I was finally convinced that I would not be able to work in such conditions, I was not ready to carry such a load.
- Will the Victory team cope?
- This is a great team, the best people, they will cope. From the point of view of the smoothness of the processes, I hope everything will go according to plan. I really want Victory to be among the survivors. Because it will be a pity (if not.- "Kommersant"). This is a truly unique project.
- Do you continue to communicate with the Victory team? And is it possible to return?
- No, this book is read, as they say, died so died. The company is currently the most stable and successful in Russia, with a good margin of safety. She can not work at all for a year: not fly anywhere, put planes, pay salaries and spit at the ceiling if she wants.
- How can you describe the new manager?
- I suggested, in fact, Andrey (head of the Aviation Engineering Service Andrey Yurikov.- "Kommersant") for the position of acting. He is a very competent manager and a first-class technical specialist, now we need just such. We are in a period when these competencies come to the fore, the main thing is to ensure security.
- What was and what remains "Victory" for you?
- This is my fourth child. My daughter was born in 2014, and Pobeda flew in 2014. I made my first flight on December 1, and my daughter was born on the 6th. When my daughter went to school, Pobeda became the most efficient company on the market. Now this fourth child of mine has grown up - it's time to let the "Victory" go on an independent voyage.
- In mid-February, we met with you to record an interview, which we did not have time to publish until February 24. You told me that you fly with the Victory family. Will you continue to fly? When is the next trip?
- Of course I will continue. This is my favorite airline. We wanted to fly with our family on a traditional vacation to Antalya, but Pobeda no longer flies there. We looked at the prices for Turkish Airlines - this is space. Therefore, we had to build a route through Helsinki.
- Sources in the aviation industry say that you have Turkish citizenship, and some believe that after leaving Pobeda, you left the country (the interview was taken in Moscow).
- What is the second citizenship? It doesn't exist and never has been. When I worked at Aeroflot, I generally had access to state secrets. So I have only one citizenship - Russian.
- And not planned?
- Not planned.
- Why are you staying in Russia?
- Because I'm Russian. My mom is here, the whole family and a huge number of other reasons. Where to go and, most importantly, why?
- For example, to a friendly country - to launch a new airline.
- I'm not ready. Do not confuse tourism with emigration. By and large, who needs us there?
- Okay, who needs you here? Do you have any job offers?
- Offers have been pouring in for a long time, not from the aviation industry, from other areas, most of all from retail. But I'm not considering them yet, I want to take a break, eat "Twix" while it's still there. I've already had a period without a job in my life, in which everyone said that I wouldn't last long with my unrestrained energy, but I lasted a whole year, and it was a great year. So I'm fine.
- Could you go to work for another airline?
- no. I would not be ready to go to existing companies before that. It is impossible to rebuild them, especially companies with a large fleet: their traditions and foundations have developed everywhere. It is impossible to make a successful company out of an ordinary one. A huge number of people are not used to working like this.
- How "so"?
- Well, take the same flight attendants, no one except ours, that is, now not ours, but Pobedy, can prepare the cabin in 25 minutes. Pilots do not know how to fly so intensively. No one knows how to treat customers so sincerely and warmly.
- There are excellent crews in other companies, their flight attendants also know how to keep a brand.
- Yes, but they don't know how to wrap the ship in 25 minutes at the same time. It turns out that one thing. Pobeda can do everything at once.
- Let's say, but what about management?
- This is the reduction of excess personnel, the breakdown of all processes, the change of ground handling, flight manuals, maintenance - everything needs to be rewritten. Everything should be aimed at efficiency. This will cause a huge, frenzied resistance within any company. This is a different corporate culture, a different attitude to customers, to the way of thinking.
Feeling of ownership - the feeling that you are the owner, the attitude towards the company, when your soul aches for it as for your own - managers either have it, or they don't. The key people in the team should have this feeling: "this is mine." To achieve a result, you have to lay down your life, and I'm definitely not ready. Theoretically it's possible, but I don't want to prove anything to anyone anymore. Let Pobeda remain such a bright star.
- How have you lived this month? You were at a dacha near Moscow, as far as I understand?
- I'm generally a lock. Yes, I was at the dacha, Great Lent is going on now, and I have something to think about at this time. March 5 (the last working day at the head of "Victory".- "Kommersant") everything ended, and then it started anew, in a different way, and very intense: a lot of things had accumulated, it was necessary to plant seedlings of peppers for the cottage, repair the greenhouse, take the child to school. First, second, third - there is no free time at all.
- When are you planning to go to work?
- I want to rest. These were driving and difficult years. I have accumulated under 60 days of unpaid leave. Then we'll watch. And I definitely don't have an obsession with aviation. It is dynamic, interesting, but just one of the types of business. I do not think that he is any unique - no worse and not the best of many others.
- But it is considered more capital-intensive, high-tech and romanticized.
- More romantic, of course. And more technologically - yes, but we did not create technologies, we, as an airline, bought them on the market. When you are in profit, you can buy the best technologies and products to be even more efficient, earn even more and spend, it's such a cycle. Was.
- In the same unpublished interview with Kommersant, you were going to announce that Pobeda announces the recruitment of 50 foreign pilots. Now that everything has changed, should we be afraid of the outflow of our Russian pilots to other countries: China, Vietnam?
- China - maybe when it starts to restore transportation, but timid signs there have been covered by a new wave of covid. They are now ordered to Europe, although they were not particularly expected there before. The remaining pilots will have a drop in the raid - respectively, earnings will fall. But nothing supercritical will happen. It will be worse with new pilots - for example, the release of 2022: I am sure that no company will take a single cadet. Last year's graduates were also not taken away by all, and this is a problem. And it may come to an end in three to five years, when and if the restoration of transportation begins in Russia, and there will be no one to restore it.
- Will we recruit pilots from other countries again?
- Definitely. This gap will have to be closed one day. In 2020, we recruited very few pilots due to the pandemic, very few in 2021. In 2023, the situation is unlikely to change dramatically. Age commanders will retire. There will come a time when it will be massively necessary to introduce co-pilots into the FAC (aircraft commanders), but there will be no one. And for such a transfer, time must pass, and not every co-pilot can become a FAC and take responsibility. These are leadership psychoemotional qualities, willingness to make decisions, manage stress. And this gap will definitely happen.
- Is a shortage of flight attendants possible?
- The term of their preparation is a month and a half, not a dramatic question. People will still come - for travel, emotions.
- Will you continue to fly as a flight attendant yourself, if offered?
- I flew to understand and optimize processes - as a manager. But now to continue for the sake of the fan? No, it's not much fun. It's a very difficult job. The load on the legs, musculoskeletal system. A constant regime of reduced oxygen content, the water balance is disturbed. I generally think that this is a three-year job.
- In the words of Transport Minister Vitaly Savelyev, we simply "took someone else's property," that is, foreign planes. Will it ever be possible to restore relations with lessors after that?
- It depends very much on the political situation, the conjuncture. And it is impossible to say in advance how our partners will behave in the future. But definitely everything will become much more expensive, premiums for country risks will increase. They also see that Russia once joined the Cape Town Convention (Convention on International Guarantees in Respect of Mobile Equipment.- "Kommersant"), and now it violates it.
- In your opinion, are these planes a big loss for foreign lessors?
- If it is a real loss, then it will not be a loss for them, it is an insurance event. But from a legal point of view, of course, it is a very unpleasant situation for them.
- Have you managed to communicate with lessors? Why didn't they try to sell their contracts to other countries at a discount, as banks sometimes sell "bad" debts?
- I didn't have time. But I don't think anyone would want to acquire such toxic assets.
- And if soon, as many hope, the European leasing lobby forces its authorities to adjust the conditions of sanctions and restore relations, then they will start...
- Try to recover all losses. To cover the unpaid lease and evaluate the transfer to the Russian registry, which actually zeroes the cost of the aircraft, it will not cost anything on the international market. He was served by incomprehensible schemes by incomprehensible people with incomprehensible certificates.
- In theory, it is possible to carry out a complete diagnosis of the aircraft and prove its serviceable condition.
- It doesn't work that way. We will have to roll back everything by the time of the last legal "check" (check.- "Kommersant") and redo everything. Because for the owner there is no understanding who did it, who and how carried out service checks and repairs. De jure, this can only be done by a certified specialist who has been trained and periodically checked.
- Let's fix it: it is impossible to show on a deep check (full check), as some hope that this nut is normally twisted by an intelligent specialist.
- You can't. And it is impossible to understand what kind of nut it is, too. I repeat, these are aircraft with zero residual value on the international market.
- My sources at Aeroflot at one time said that the carrier could merge the remaining fleet of aircraft with Russia (part of the Aeroflot group). Then this idea was abandoned or put on pause. Why has the Victory fleet never been discussed in this context?
- I don't have an answer to this question. But in the current situation, I don't see any problems in making a single large Aeroflot.
- Of the three airlines?
- In general, all airlines. (Laughs.) How to manage this is not very clear, but there are a lot of incomprehensible things right now. It's one thing to manually make flight plans for 30 planes, another for 300. Almost all foreign IT systems are disabled by providers. Who could have imagined such a thing, but it turned out to be possible.
- And do we need a domestic aircraft, as practice has shown?
- I'm sure you do. And if I had been asked this question two months ago, I would have answered that I needed it. Regardless of the political situation. Because choice is always good. Because this is a matter of transport independence and prestige of the country. Plus, the development of their competencies is a ticket to the club of leading world powers. But it needs to be done well. No need to chase two birds with one stone and do two (projects) at once - do one, but cool. For some reason, we are always catching up, but we need to look to the future. If the aviation industry were a business project and conducted by merchants, it would be successful.
- If you need your own plane, then why was it reluctantly ordered? My interlocutors in the aviation industry say that all these years most airlines did not want to buy a Superjet, which prevented them from scaling production and developing the project. According to the aviation industry, it could be more successful if companies showed more interest.
- Then the prices for it should be twice as low. Here is a good example of the success of the Chinese in the automotive industry: they also had no experience, no image, no brand - nothing. They did twice as bad as the Europeans, but four times cheaper! And there was a huge demand. And if they immediately started selling their cars at BMW prices - would they develop like this? I don't think.
- I don't want to be a brand ambassador, but SSJ is cheaper in the catalog and subsidized. It doesn't stand like Boeing.
- Based on the cost of one seat on an airplane, it costs much more in use. Take the Boeing 737 MAX for $40 million for 189 seats and for $28 million SSJ for 100 seats. And the first one flies for 14-15 hours a day, and the second one - five. That's the whole economy. Plus maintenance costs. Now, if it cost not $28, but $10 million, there would be a queue for them.
- You will be objected that the state has done everything to cover this difference in price and give carriers the opportunity to roll out the plane.
- Yes, the state eventually subsidized anyway, but it was necessary to cover the operation, and not only transportation on inefficient routes. It was necessary to subsidize the sale price, the bid. It was subsidized, but not enough, as practice has shown. And the MS-21, even taking into account subsidies, was offered to us more expensive than the Boeing 737M. If the economy is market-based, everything should work in business logic. If this is a planned economy, then you can distribute "Superjets" to everyone, and this is also an option. But you need to choose one thing and be consistent, you can't be a little pregnant.
- Can the current hype ticket prices help airlines to accumulate some groundwork for the future?
- No, of course not. It will help that the need to pay the lease will not hang like a sword of Damocles. There is no longer a need to fly for three kopecks to at least recapture it. And if you exclude leasing, other fixed costs are not so great.
And then it is better from a business point of view to fly half as much, but, conditionally, four times more expensive. There will be no more tickets like Moscow-Petrozavodsk for 1 thousand rubles, this was abnormal, and there is no more sense in them.
- VTB Capital analysts predict a 50% increase in ticket prices this year.
- I think the growth will be higher. Now no airline will make sense to fly below cost, previously it was done just to discourage leasing and fuel in conditions of fierce competition and excess supply over demand.
Now, if you simply raise prices to the cost price level, this is already plus 30% growth by 2021. And we will also have to somehow buy spare parts, the cost of logistics will increase, since direct sales are no longer possible, and we will have to look for workarounds. Therefore, the price increase will be significant. Flight time has increased on many routes - this is a medical fact. More time will be required for maintenance. The efficiency of fleet use will be reduced. The cost price, according to my calculations, should double in ruble equivalent. Therefore, 50% is still a very optimistic forecast.
- Do you expect prices to double?
- It's not the ceiling yet. But these are just my expectations.
- Can airports go for a reduction in tariffs?
- They will not be able to lower tariffs. The cost of service will also increase, especially in modern airports. The profits from duty free will be replaced by losses, all non-aviation revenues will be reduced. If the Ministry of Transport forecasts a 30% drop in passenger traffic, then this is minus 30% of airport revenues. By autumn, we will have to buy de-icing liquid, it is not produced here, it is brought in the form of concentrate. And if the planes are treated with a bad liquid, then the engines will need repairs much earlier. So you can't even dream of any tariff reduction.
- Will airports still have the opportunity to shift these costs to airlines?
- Airlines will simply close flights and leave the direction.
- And then eventually transportation can turn into...
- In luxury, yes, well, or a more expensive service. Someone has to pay for it. When Pobeda flew from Krasnoyarsk to Novosibirsk, people flew there to the water park for the weekend - there will be no such trips anymore. There can be no low-cost airline in such a situation.
- But the passenger traffic cannot completely disappear, people will transfer to trains, which will also rise in price.
- Economists have long proved that GDP is very tied to the transport accessibility index, and the more movements, the higher the GDP. Conversely, GDP, as many expect, will also "sit down", that is, the level of transportation cannot remain at the same level, this is a relationship.
- Do you expect that transportation subsidies will increase? Have you treated them negatively, would you reconsider your views now?
- When subsidies begin, the market in its classical sense ends. There is no clear understanding of how best to issue them: for each transported head, each passenger-kilometer. And if the conditions for obtaining them would generate the same huge costs for administration and reporting, as it has always been, then probably not. And then, I am sure that now companies will be able to earn. Leasing does not pressure, it is not necessary to perform unprofitable flights. Yes, there will be fewer of them, so what. In the summer, people will be taken to Sochi. Moscow, St. Petersburg, Kazan and millionaires will definitely continue to fly - less, but life does not stop. Just tickets will become more expensive.
- How can airlines save money and lower prices now?
- Against the background of the growth of other expenses, this whole fine tuning will no longer work. Saving on paper makes sense when your processes are fine-tuned and you are engaged in optimization. When a patient is not operable, it does not matter which seal to put on him.
- How many companies will not survive this crisis?
- I am sure that the top 10 will be kept afloat.
- In what way - by prohibiting bankruptcies?
- Yes, to prohibit bankruptcy, to prohibit airports from refusing service and refueling for debts.
- But it must have certain limits, right?
- Everything is solved.
- And small companies?
- Their fate will depend on the decisions of the regions, on the governors, on the fullness of budgets.
- From optimists now you can often hear: "They flew in the Soviet Union." Maybe now we can safely fly inside the country?
- There are no planes. Then there was a powerful aviation industry, which produced the entire line: from cornfields to transatlantic liners. And those planes corresponded to the time, Western planes of that time. But the West has gone ahead. And we ended up where we were.
- So maybe this is the finest hour of small aviation, and we will start flying ...
- On what, on brooms?
- UZGA, Baikal...
- Then there were a huge number of factories, the Tashkent Aircraft Factory, Samara, Ulyanovsk, Voronezh, thousands of people worked there. Vocational schools trained locksmiths, turners - where are they all now? How to increase production without this? Robots do a lot in the West, but our production has remained almost at the same level as in the USSR. We need specialists to increase production, but there are none.
- My interlocutors in the industry as a whole confirm the shortage of specialists, but differ in the reasons. What is the reason for the shortage of personnel, in your opinion: are salaries small or do they not believe in platforms?
- There are no customers. And in order for a person to want to become a turner at VASO, he must see that his friend from this plant drives a good car, provides for his family, goes on vacation at sea. If there are no such examples, no one will want to go to the factory. Why is there a competition for admission to aviation schools, as in MGIMO? Because everyone can see what salaries pilots have in airlines. That's the answer to the question about the shortage of personnel in the aircraft industry.
- There is such a point of view: planes fly in Iran because they are old and it is easier to find spare parts for them under sanctions. Do you agree with this?
- The old fleet is much worse, it is more difficult to maintain, requires much more consumables, more spare parts. Where to recruit them now? Extend, extend, extend (resources.- "Kommersant") - very difficult. The older the plane, the more failures it has.
- Aren't these understandable, long-worked-out defects?
- No "understandable", something constantly pops up. Somewhere the wiring is rotting, somewhere condensation is formed and so on. And the more deferred defects accumulate on an airplane, the more difficult it is for a pilot to fly on such an airplane. There is constant stress. Not everyone can be ready for this.
- What signals and solutions should the authorities or companies demonstrate so that people do not become afraid of flying?
- Our people are very brave, they are not afraid to fly, they are not afraid of anything at all. They are not afraid to fly (the name of the airline.- "Kommersant"). (Laughs.) Or remember the earthquake or fires in Turkey, which scared off, it seems, all tourists except Russians.
Mentally we are different from the Western world. The price has always been more important to us.
- Do you maintain relations with colleagues from other airlines? How do you assess their attitude?
- of course. Every company will stand to the last. And that's fine.
- Most still continue to try to beat the butter and negotiate with the lessors. Do you regret that you left the race?
- If I believed that it was possible to beat butter, I would have stayed in the CEO's chair.
- Will you be happy to make a mistake?
- Yes, I will be happy to make a mistake. And it will be very hard for me if this wonderful project, if Pobeda still falls apart. She has to stay.
Aigul Abdullina
Former CEO of Pobeda Airlines (part of the Aeroflot Group) Andrey Kalmykov (c) Igor Ivanko / Kommersant
