What does Aegean Airlines gain from Olympic Air merger?

Theodore Vassilakis, Aegean Airlines CEO

Now the really hard job: After getting the merger go-ahead, Theodore Vassilakis, Aegean Airlines CEO, will now have to find a new name for the airline. Most have already been tried.

At one time the proposed merger between Greek carriers Aegean Airlines and Olympic Air might have seemed like a marriage of equals, but the current reality is quite different. Based on scheduled ASKs (Available Seat Kilometres) in October, Aegean is 10 times larger than Olympic. While Aegean has grown its ASKs by 8% in the last 12 months, Olympic has cut its ASKs by half. So with the EU having finally decided to allow the two carriers to merge, how do the networks of the two carriers compare? What is it that Aegean gains by absorbing Olympic?

Aegean’s international diversification; Olympic’s domestic focus

While Aegean has been focussed on growing its international network, not just from Athens but from other Greek airports, Olympic has been left primarily to deal with a rapidly shrinking domestic market focussed on Athens. Between 2009 and 2012 domestic passenger numbers at Athens International Airport have fallen by 26.4% from 6.13 million to just 4.51 million. In the first nine months of this year, domestic demand has fallen by a further 5.5%.

Athens International Airport 2007-2013 Annual domestic passengers (millions)

Source: Athens International Airport, anna.aero forecast for 2013 based on Jan-Sep data

According to Innovata / Diio Mi data for this month, Olympic is operating a total of 40 routes, having dropped five and added none since this time last year. Of the 40 routes, 32 are from Athens, and of those 27 are to domestic destinations, with just five international routes (to Belgrade, Bucharest, Istanbul, Sofia and Tirana). The eight non-Athens routes are all domestic. None of the airline’s routes have a sector length of more than 850 kilometres. Among the five routes dropped during the last year were two (Larnaca and Tel Aviv) that were over 900 kilometres. This helps explain how the airline’s ASKs have fallen so dramatically (by 50%), but the number of flights operated has been cut by only 19%. The airline’s fleet currently comprises 10 78-seat Q400s, four 37-seat Dash 8-100s, and a solitary A319. In October 2012 Airbus aircraft operated over 250 weekly flights for the airline, but this has now fallen to just 40, made up of 10 weekly return flights to both Alexandroupolis and Santorini.

Aegean almost twice as big as Olympic in domestic market

One way of comparing the two airlines’ networks is by examining how many weekly ASKs are allocated to different markets segments. Despite Aegean’s focus on international routes (84% of its ASKs) it still generates over 80% more ASKs on domestic routes from Athens than Olympic.

Market Aegean ASKs (m) Share of
Aegean ASKs
Olympic ASKs (m) Share of
Olympic ASKs
Domestic routes from Athens 22.57 13.3% 12.63 75.3%
Other Greek domestic routes 4.10 2.4% 0.35 2.1%
International routes from Athens 100.27 59.2% 3.80 22.6%
International routes from other airports 42.43 25.1%
Total 169.37 100% 16.78 100%
Source: Innovata / Diio Mi for week 7-13 October 2013

Aegean only serves 10 domestic points from Athens, compared with 27 for Olympic, but the use of larger aircraft (it has an all-Airbus narrowbody fleet) and higher frequencies, more than compensates. On nine of Aegean’s 10 domestic routes it offers more weekly seats than Olympic, with Kos being the exception. Athens-Rhodes is one of the routes that Olympic does not serve at present, but did serve this time last year.

Athens domestic routes Aegean v Olympic - weekly one-way seats

Source: Innovata / Diio Mi for week 7-13 October 2013

The 10 domestic routes that Aegean flies (of which eight are also served by Olympic) also account for almost 45% of Olympic’s weekly domestic seats from Athens. The remaining 55% are spread across 19 other domestic routes on which Olympic does not face competition from Aegean. Although the indications are that after the merger both airlines will continue to operate as separate brands, it will be interesting to see how much further capacity rationalization takes place on these domestic routes.


  1. mike halper says:

    I guess the big questions is, will Aegean turn OA into a much needed regional LCC??

  2. deTraci Regula says:

    Hope so – there’s so much opportunity there for easier island hopping with more inter-island flights instead of constantly needing to return to Athens.

  3. James Laskey says:

    Aegean have bought Olympic Air so no need for a name change. The company name remains the same. It is misleading to state otherwise.

    • The names may remain unchanged for now, but it will be interesting to see what happens in the future. Based on what has happened elsewhere in the world when two airlines merge in the same country, the name of the smaller airline invariably tends to disappear within a few years, so in fact we may just be left with Aegean …

  4. Ikaros says:

    Aegean gains something, not much, from the merger as they already had established a monopoly in the domestic market. It was an issue of honor…so to speak, as the owners of Aegean had done everything it takes, together with the government (s) over the year, to eliminate OA. Now they have done that official, the NAME AND THE LOGO,is the price for the family that own the majority of the shares. It will be interesting to see how they will use the name and the logo, I think the first thing they should do, should be to announce flights to North America with a B747-400 , even charters at the begining, as OLYMPIC, not as Aegean, no one knows that name. Slowly they can establish a present into markets that the name OLYMPIC ( call it BRAND if you like), could help them develop further. China and Russia are two other markets. In addition, OLYMPIC can fly “domestic European routes”, say…London Frankfurt. Recognizable name,…it will be a hit. In any case, starting with the traditonal “nasionalistic” routes to North America of OLYMPIC, will be a good start.

  5. Andreas says:

    Olympic is a strong brand name in Greece, much stronger than Aegean. There is no way to reject this name. Ikaros is right.

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