Aeroflot: 90 Years And Counting

Aeroflot, the world’s third-oldest airline (operating since February 1923), recently celebrated 90 years as one of the world’s most prominent commercial aviation brands. As Russia’s national carrier and largest airline, it only gets better with time. In the last few years alone, the airline has reached significant milestones.

In 2009, Aeroflot opened Terminal D, Moscow’s newest airport terminal, which some of its SkyTeam alliance partners have also chosen. In 2011, it opened the Aeroflot Aviation School, which offers training in 120 aviation-related professions. With an aggressive plan in place, the school will graduate 160 pilots a year.

It also, that year, expanded its membership in the SkyTeam alliance by joining SkyTeam Cargo. In addition, it acquired a number of Russian regional airline companies from Rostekhnologii (Russian Technologies State Corporation).

Clearly, the airline intends to continue on its successful path, but it is not solely about flying business and leisure passengers to their desired destinations. As a Group, it provides jobs to close to 29,000 employees, and it generously supports its community.

Aeroflot, which provides flights to 185 destinations in 53 countries, plays an active role in its community through on-going support of charitable organizations and community events. In 2010, the company made it to the top 10 in Russia’s Corporate Social Responsibility Index, taking the fourth position on the list.

Aeroflot is actively involved with a variety of social initiatives, such as:

  • Revisiting Battlefields Program — Provides air travel for War Veterans during the annual Victory Day celebrations in May.
  • Miles of Charity Program — A joint project between Aeroflot and Podari Zhizn (Grant a Life) Foundation, which allows frequent flyers to donate their bonus miles to seriously ill children.
  • Medical Transportation — Provides regular assistance in transportation of gravely ill children to overseas medical institutions for treatment that is not locally available.
  • Train of Hope — A national charity for orphans that provides free air transportation for prospective adoptive parents.
  • Russia’s Ministry for Extraordinary Situations (EMERCOM) — Aeroflot works closely with the Russian government to provide aid and evacuation services to people affected by conflict or natural disasters.

In a recent interview with Ascend, Vitaly Saveliev, who assumed the position of Aeroflot’s chief executive officer in 2009, discusses his role as the airline’s leader and some of the strategies behind its success.

Question: What major changes have you made on behalf of the airline, its employees and its passengers since being named CEO in 2009?

Answer: Since I became CEO in 2009, Aeroflot has accelerated its fleet-renewal program, thus making its fleet the youngest in Europe. In 2011, we announced orders for 16 Boeing 777s, with deliveries beginning in February 2013. Since June 2011, Aeroflot has been phasing in the Sukhoi SuperJet-100, a new-generation, Russian-built aircraft. The company has placed strong emphasis on improving the quality of the customer experience, at every point of contact, the results of which have on many occasions been observed by both Russian and European experts. The company’s website (www.aeroflot.ru) has been updated, which has increased the traffic four-fold and led to a dramatic growth in the number of tickets sold via the site. The active introduction of new technologies has helped increase sales and decrease expenditures and generally optimize efficiency.

Modernized Aircraft Fleet

Two years ago, Rossiya, Orenair, SAT Airlines and Vladivostok Avia, were integrated into the Aeroflot Group. As part of the objective to create an airline holding that could effectively compete with high-ranking carriers in the international aviation market, Aeroflot’s aircraft fleet is being completely updated.

Q: You have held a number of executive roles in various industries. What brought you to the airline industry?

A: The airline business has high visibility among customers and investors. I was attracted by the opportunity to turn Aeroflot into a globally competitive carrier. Aeroflot is not just a big company per se. It is an enterprise vital for Russia and its economic, social and industrial development. The well-being of the industry and the entire economy depends on how well Aeroflot operates. Air transport is socially important for Russia, and we understand the importance of accessibility of transportation services for the citizens of Russia irrespective of the regions in which they reside.

Q: Aeroflot is a well-known, powerful brand in Russia and around the world. What are some of the airline’s attributes that have supported a strong, long-lasting brand?

A: In Soviet times, Aeroflot was a global brand, a testimony of national power. Then the turmoil of change resulted in Aeroflot breaking up into hundreds of small airlines, losing its influence and shrinking its footprint. Now we have left that stage behind. The company has regained a leadership position both on the Russian market and on traffic flows to and from Russia. Today, Russia is reclaiming its place in the rapidly changing world and so is its national carrier, which has become a strong brand of the new Russia, as a result of our focus on flight safety, technical and operational excellence, and high-quality onboard service. An acknowledged leader in brands evaluation, British Brand Finance, evaluated Aeroflot’s brand at more than US$1.4 billion with substantial growth potential and placing the company within the world’s top 20 aviation brands. Taking pride in bearing the name of one of the oldest airlines in the world, we consistently enrich our brand with new essence. Today, Aeroflot is a fine example of a modern Russian business with highest standards.

Q: Aeroflot’s vision is to become a global network company and a leader among the world’s major carriers. How will you turn this vision into a reality?

A: We understood that organic growth would not allow us to develop the opportunities of the very dynamic Russian market. That is why Rossiya, Orenair, SAT Airlines and Vladivostok Avia were integrated into the Aeroflot Group in November 2011. This represents the first large-scale attempt in Russia to create an airline holding that can compete with the grandees of the international aviation market. It means that the group’s aircraft fleet is being thoroughly modernized, service quality and business efficiency is dramatically improving also on a regional level, and the number of passengers carried by the regional airlines is expected to rise more than the market. Russia’s regions will become much more accessible, population mobility will increase, and flight safety will reach new levels. Integration will allow Aeroflot Group to develop a large-scale aviation holding, which will be able to compete with the world’s leading carriers.

Q: According to Aeroflot, quality determines its future. What strategy have you put in place to enhance the quality of service for your customers? In what ways has Aeroflot improved customer service during the last five years?

A: Aeroflot carefully tracks customer satisfaction through a number of different methodologies. One of these is the so-called Net Promoter Score, a proprietary methodology developed by the renowned consulting company Bain & Co, which measures the customer propensity to promote the experience. Aeroflot is the best carrier in Europe, with a performance that has increased from 44 percent in 2010 to 56 percent in 2012: by comparison, Lufthansa scored 44 percent and Air France scored 10 percent.

We regularly submit our standard of services to reviews and comparison run by IATA (best business-class service in Europe in 2011/2012), by SkyTeam (best carrier in check-in and on-board services) and by Romir Research Holdings, which runs a “secret passenger program” on 170 service standard parameters; Aeroflot scores 4.5 out 5.

We have improved the quality of our in-flight service to passengers. As a result, Aeroflot took the second place in the annual study of the quality of on-board culinary offerings in the long-haul dining category made by Skyscanner.ru, a popular travel search site.

Aeroflot’s Pilot Training Facility

In 2011, the Aeroflot Aviation School was opened at the Aeroflot headquarters in Melkisarovo. The non-government educational institution will train and graduate 160 pilots (80 crews) a year. In the future, the training facility will be offered to other airlines (outside of the Aeroflot Group) for aviation training.

More than 550 European travelers and bloggers performed as food critics, analyzing on-board menus of leading European air carriers. As a result of the 2012 Skyscanner European Airline Food Awards, Aeroflot was ranked second in the long-haul dining category and fifth in the short-haul one, being the only Russian company in European Top-5 for both flight categories.

Q: Your employees feed directly into your customers’ experience. What type of corporate environment have you created to ensure your employees are aligned with your mission to help passengers materialize their plans and dreams — work efficiently, relax with pleasure, meet with relatives and friends, and explore new countries and cities?

A: As a major international airline, the Aeroflot Group is a leading employer providing more than 29,000 jobs in Russia and at its operations abroad. It remains committed to investing in its staff and supports a progressive work environment with competitive salaries and benefit packages.

Q: In what ways have customers participated in helping make improvements to your airline?

A: I am an active user of Twitter and personally communicate with Aeroflot customers via this channel. I have more than 27,000 followers and often receive feedback on Twitter. Recently, several customers requested via Twitter the opportunity to upgrade at check-in using their Aeroflot Bonus miles. Aeroflot has reacted to this request and now offers this service.

Sheremetyevo’s State-Of-The-Art Terminal D

In 2009, Aeroflot and its partners began flying in and out of Sheremetyevo’s new Terminal D. To meet passengers’ needs, Aeroflot increased its fleet and built its own new hub in Moscow. With annual capacity of 12 million passengers, Terminal D is designed to serve Aeroflot’s flights as well as those of its SkyTeam partners.

Q: What sets your airline apart from the competition?

A: The Aeroflot Group entered the global top 10 and the European top three for its financial results: we know how difficult it is to deliver impressive growth and positive financial results, so I believe we are on the right track to fulfil our ambitious goals. We are a modern and dynamically developing company, which leads in IT innovations and offers passengers the most modern fleet in Europe and the best service across the SkyTeam alliance. Wi-Fi connection is now available on a larger number of wide-body aircraft; more flights with mobile connection are at our customers’ disposal; and an ever-growing number of airports with alternative check-in options — Internet (including the mobile version of Aeroflot’s site), cell phone and through self-service kiosks — are available to our customers.

Q: Aeroflot has achieved several industry firsts, including being the first Russian air carrier to have successfully passed the International Operational Safety Audit and become registered as an IOSA operator. Why was this accomplishment important for your airline? How has your airline benefited by becoming an IOSA operator?

A: All of Aeroflot’s aircraft meet the best international safety standards. Every year we undergo a routine audit of operating safety compliance with IATA standards in the reporting year, and no deficiencies have been identified with respect to the audit requirements. That is a unique result for both Russian and international carriers, confirming Aeroflot’s position as the safest carrier in Russia and one of the safest in the world. We have the biggest flight control center in Eastern Europe, and 2011 saw the opening of our own aviation school and situation center. The IOSA certificate confirms that Aeroflot employs cutting-edge standards in operational security management, gives an incentive to expand international cooperation with leading air carriers, facilitates entering new markets and enhances the spectrum of the company’s services.

Q: You have a long-term strategy in place through 2025. What are the main components of this strategy? In what ways will Aeroflot be different in 2025 compared to today?

A: We want to see Aeroflot Group among the five top European leaders and the 20 top world leaders by passenger and revenue in 2025, and we want Aeroflot to be a global network company. We want to be one of the most successful air carriers in the world, an agent of aviation sector development and of Russia’s economic development. The excellent results we achieved in 2012 show that we have the potential to achieve our objective. We are committed to unlocking that potential.

Q: As mentioned, Aeroflot plays an active role in community charities and events. Several programs focus on orphans and children with medical issues. Why does your airline place such a strong emphasis on children? Why is this level of community involvement important to the communities you serve?

Aeroflot Joins SkyTeam Cargo

Expanding its SkyTeam membership, Aeroflot joined SkyTeam Cargo in 2011. The airline’s prime position in the Russian market as well as central hub connecting Europe to the Middle East and Asia, will enable SkyTeam Cargo to benefit from growing world air cargo traffic demands.

A: Corporate social responsibility is an established tradition and an important principle of operation of Aeroflot. Our company pays special attention to working with underprivileged groups of people. We carry out our own social programs and participate in various charity projects. Aeroflot was the first Russian airline to introduce free tickets for the veterans of the Great Patriotic War during the celebrations of Victory Day. Aeroflot helps sick children by providing free seats for them to transport them to hospitals abroad, and it helps artists and talented youth. These measures are taken on a regular basis and are part of our comprehensive programs.

Q: What is your biggest priority for the next 12 to18 months?

A: Aeroflot has a long-standing tradition of supporting sports and the Olympic movement. Throughout our history, Aeroflot has transported our athletes to all major world competitions and Olympic Games attended by Soviet and Russian national teams. Aeroflot is the main partner of the 2014 Sochi Winter Olympic Games. Many participants and guests to the 2014 Olympics will get their first impression of Russia when they board Aeroflot. To make a good presentation for the country, Aeroflot has launched a comprehensive preparatory program: we are getting new airplanes, plan to increase the number of regular flights to Sochi and operate direct flights from Sochi to Europe. With the national specifics of the Olympic participants and guests in mind, we are launching special training programs, improving the language skills of our flight attendants. The Sochi Olympics offer us a unique chance to attract new foreign customers, and Aeroflot is sure to benefit from it.

Table of Contents