Transaero chief executive officer Alexander Pleshakov said that the airline will raise fares for destinations by 10-15% from the winter season, which starts at the end of October, TASS reports on Monday, October 6 .

“An increase in tariffs is inevitable. This is one of Transaero’s steps to optimize its activities in a shrinking market,” Pleshakov said at a conference of the Association of Russian Tour Operators (ATOR) for partner tour operators. He added that the second reason for the increase in tariffs is the strengthening of the dollar against the euro, since all international retail sales are carried out at tariffs based on the euro, while the cost of maintaining the aircraft fleet is in dollars.

Another aspect is the planned tax maneuver in the oil industry, which the airline is “beginning to talk about.” According to Pleshakov, this tax maneuver could lead to a significant increase in the price of jet fuel in Russia, which will be noticeable in the first, maximum in the second quarter of 2015. “And, besides, no one has canceled inflation in Russia either, and it seems to be heading towards 8-9%, according to official statistics,” he noted.

At the same time, the company, according to the executive director of Transaero, does not have “a single message why tariffs should be reduced.” At the same time, he explained that the carrier has a wide tariff scale of the “Discount” class, and this allows it to offer tariffs that satisfy the interests of different categories of passengers. Transaero is also going to extend budget tariffs for young people and buyers of retirement age.

Transaero is the second largest airline in Russia in terms of passenger traffic, after Aeroflot. In 2013, it transported 12.5 million people. In the first half of 2014, the airline showed an increase in profit according to IFRS by 61% - to 750.5 million rubles, EBITDAR increased by 17.33% - to 9.9 billion rubles, EBITDAR margin increased by 1.84% to 20. 53%. The degree of debt coverage by current income under RAS over the same period worsened - from 22.64 to 34.82, which the company explains by “the deterioration of the geopolitical situation in Ukraine.”

Transaero will raise tariffs by 10-15%