Ukrainian President Volodymyr Zelenskiy has called for the establishment of a state-owned airline national champion similar to Turkish Airlines or Singapore Airlines, reported UBN on April 23. Ukraine’s aviation industry has been hard hit by the coronavirus (COVID-19) pandemic and will take at least two years to recover, according to the Infrastructure Ministry.

Ukraine’s aviation and travel industry has been booming in the last years as the country starts to recover from near total collapse in 2015 and millions of Ukrainians have left for jobs abroad or simply gone on holiday.

Facing what could be a six-month, government-imposed shutdown, Ukraine’s four largest carriers – Azur, SkyUp, UIA and Windrose – have already asked for aid from the Infrastructure Ministry, which predicts it will take two years for Ukraine’s air traffic to return to the level of 2019.

However, the coronavirus (COVID-19) pandemic has crushed the flourishing industry and is causing tens of millions of dollars of losses for the industry. The government is looking for ways to help the sector survive, but the suggestion by Zelenskiy to set up a national champion could also be seen as his growing efforts to contain the power and influence of his mentor and presidential campaign sponsor, oligarch Ihor Kolomoisky, who owns Ukraine International Airlines (UIA), long the largest airline in the country.

The state-owned carrier would fly the Ukrainian-made giant cargo plane, the Antonov, Zelenskiy said during a broadcast aired on Ukraine 24 to mark one year since his first electoral victory one year ago.

The enormous Antonovs are a source of national pride for Ukraine and the plane has added to its prestige in the last weeks by delivering tonnes of medical equipment and supplies around the world to destinations like New York as part of the global efforts to fight the coronavirus pandemic.

Best known for delivering cargo, there are passenger versions of the plane – the An-148 and An-158 – but they are not currently certified to fly in the European Union. The passenger Antonovs are limited to flying on domestic routes inside Ukraine as well as to Belarus and Moldova.

Both Ukraine’s two main international airlines – SkyUp and UIA – are asking the government for compensation for what could be three months without their scheduled passenger service. UIA had already applied to the state for hundreds of millions of dollars in compensation after Ukrainian planes were banned from flying over Russian airspace in recent years as part of the tit-for-tat sanctions the two countries have been imposing on each other. The sanctions meant that UIA international rivals, which continued to fly over Russia, had a lot shorter route to Asian destinations, whereas UIA routes were longer, as it had to fly around Russia, adding to costs and putting it at a cost disadvantage.

The airline industry in Ukraine has been hard hit by the pandemic which has effectively grounded all flights for at least several months.

Ukraine’s air passenger traffic will only return to last year’s record levels by the end of next year, according to Ukraine's Infrastructure Minister Vladislav Krikliy told the European Business Association earlier in April.

“If we start to recover a little in June, then by the end of the year we’ll reach about half of the passenger flow that was earlier,” he said in an online briefing, adding the government is strapped for cash already and can offer little in the way of support for the industry. “There isn’t enough in the Ukrainian budget to save every enterprise.” 

Airline traffic plunged 35% year on year in the second quarter of this year, to 417,400 passengers.

But the crisis has been a boon for Antonov, which was already running a successful international cargo business before the coronavirus pandemic. Air cargo prices between China and Ukraine have tripled since the quarantine started one month ago, Avianews reports. Previously, when 80% of air cargo was carried on passenger jets. The delivery price of one tonne was $4 to $4.5 a kilo, but now the price is $12 to 18. UIA and SkyUp are using idled passenger jets to carry cargo. 

It may take four months before scheduled flights are flying again out of Ukraine, according to Krikliy on April 20. He said: “I think that scheduled [flights] are quite likely to be resumed in September or even earlier, by the end of the summer.”

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