National airline Tarom set out to attain a $245 million turnover in 2004 and cut losses by 59% to $6 million. These estimates are backed by the upward trend of its business in the first four months of 2004.
"Tarom's four-month revenues are 35% higher than in the corresponding period of 2003. At the same time, it had 13% more passengers for its regular flights, which led to an increase in occupancy by 5% to 59%," said Aurelia Fulger, Tarom's marketing and sales manager.
Tarom concluded financial 2003 with $14.5 million losses, below the $19.4 million provided for in the company's business plan. Last year's result is a 29% decline compared with the losses in 2002. Turnover amounted to 7,281bn ROL ($220 million) last year, while gross losses reached 343bn ROL.
"Industry-wide losses in the civil aviation business caused Tarom to see a sharp decline in operations in the first half last year," Fulger added.
The cash troubles prompted the company to cut the number of flights to the Middle East and completely drop flights to Beijing and New York. It began to rebound in the second half of 2003, posting a slight increase in the number of passengers (1%) and revenues (16%) compared with 2002.
After dropping long-haul flights, Tarom's development strategy has focused on profitable European routes and on increasing the volume of operations on the Timisoara and Cluj airports.
National airline Tarom at the end of April signed an about $150 million contract to buy four Airbus 318. Negotiations took several years to complete. Tarom had initially ordered two long-courier Airbus A310's, but changed its order to four lower capacity aircraft, more suitable for its regional carrier strategy. The catalogue price of an A318 is $47 million, and the Romanian party got a substantial price cut of more than 20%. The aircraft will be delivered between 2006-2007. A318 may accommodate over 100 passengers. Tarom will take out state-secured foreign loans to buy the planes. It added two Boeing 737-700's to its fleet in 2003.
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