Young Airline in an Old Country

Even war can give an airline a fresh start, with new equipment and the latest technology. Croatia Airlines rose from such ashes.

Failed dictatorships have left many a country in ruins. The collapse of communism in Yugoslavia eventually led to brutal civil wars that killed millions of people and saw that nation ripped apart, its magnificent cities and countryside left in ashes.

Ashes, though, are the stuff from which the phoenix rises. Like that mythological bird of renewed life and vigor, Croatia Airlines has risen from the ashes of tyranny and war to take flight in Eastern Europe.

Having gained its place in domestic and international passenger service, the carrier is spreading its wings to cover maintenance services. With European certification as a repair station in hand, the carrier is pursuing third-party maintenance, repair, and overhaul work.

The background of Croatia Airlines reflects the turbulent history of the nation it represents.

Croatia lies just northeast of Italy, along the Adriatic Sea. More than 1,200 years old, it was ruled by national dynasties until 1102, when it entered a union with Hungary. In 1527, it became part of the empire ruled by the Habsburgs of Austria. When the Wright Brothers flew at Kitty Hawk nearly four hundred years later, Croatia was still under the Habsburg crown.

World War I saw the combination of Croatia and five other republics into one kingdom under the Serbian ruler Peter I. Serbs sought control over the republics. Croats resisted. In 1929, a dictatorship took over and the country’s name was changed to Yugoslavia.

World War II saw Yugoslavia conquered by Nazi Germany. Yugoslav troops fought back from mountain strongholds. One of the resistance leaders, Josip Broz Tito, emerged with the defeat of Germany to forge a communist state in Yugoslavia, ruling it until his death in 1980.

That state dominated Yugoslavia’s economy, and the airline business was no different. In Croatia, a small airline–Pan Adria–was established. Western-oriented, it operated Fokker F27s. But the state-owned JAT (Jugoslavenski Aero Transport) had the protection of the communist government. It tried to destroy every form of competition, which made Pan Adria’s life miserable.

In the late 1970s, Pan-Adria went out of business and a new airline was started under the name Trans Adria. Staffed by Pan Adria people, it used the same fleet of F27s, the same old-fashioned hangars, and the same tools. With communists entrenched in the government, the company was doomed to fail. Trans Adria reached such a bad state that JAT purchased it and let it bleed to death.

But by then, the winds of change were blowing through Europe. Tito died. National control shifted to a collective leadership, but communism was on its last legs there. One communist leader, the Serb Slobodan Milosevic, gained power in the late 1980s, intent on making Serbia dominant once and for all. He began campaigns to solidify control over Yugoslavia, in part by wiping out members of other groups through programs of "ethnic cleansing." (Milosevic is now on trial in The Hague in The Netherlands, accused of genocide and other war crimes). Croatia and the other republics yearned for independence.

In 1989, a small carrier, named Zagreb Airlines (or ZAGAL) after Croatia’s capital city, was established. Starting off with one Cessna 402C, its fleet grew to six small commuter airplanes.

In 1990, Croatia and the other republics declared independence from Yugoslavia. War broke out. With much international aid, the fights for independence succeeded. On July 23, the first democratic elections were held in Croatia.

On the same day, ZAGAL changed its name to Croatia Airlines.

In 1991, the airline struck an agreement with Adria Airways, the airline of the Republic of Slovenia. It leased a McDonnell Douglas MD-82. Croatia Airlines began service on May 5, 1991 with its first passenger flight from Zagreb to the city of Split in southern Croatia, using an ex-ZAGAL Cessna Citation II in new livery. The airline’s staff was made up of people previously employed at JAT, Pan Adria, Trans Adria, Zagreb Airport, and ZMAJ.

ZMAJ was a big military maintenance center in Zagreb that specialized in maintaining military MIG-21s and Yugoslav-built Galeb, Jastreb, and Orao aircraft. It handled maintenance of the airline’s aircraft.

A Price of War

The war between Croatia and Serbia disrupted the airline’s operations. Its maintenance technicians had use of modern, Western test equipment. Dedicated test benches were designed in-house. Test software was developed in ZMAJ’s own facility for many different applications. Deadlines and pressure like at modern MRO companies did not apply. If an engineer was developing a new test stand or procedure and needed some more time to finish it, nobody got nervous. At the end, the excellent and sophisticated product was finished and the guy was proud that everything was working just like he wanted it to work.

That all was lost in the war. But many of the people remained active in Croatia’s aviation industry.

In 1992, Croatia Airlines leased three Boeing 737s (the -200/300 variety) from Lufthansa, which began a strong and solid relationship. The next year, it added two more 737s and two ATR-42s, another of which was added in 1995.

In 1997, the airline began switching from Boeings to Airbuses, getting its first A320. A second A320 and an A319 were added in 1998, and another A320 and A319 joined the fleet in 1999, at which point the 737s were sold. The year 2000 brought another A320 and A319. Today, Croatia Airlines’s fleet includes three A320s, four A319s, three ATR-42s, and a BAe 146-200.

The airline has not had trouble filling its airplanes. Since it began operation, Croatia Airlines has averaged more than 20 percent annual increases in passenger traffic. A major development in its growth came on October 16, 2001, when the German civil aviation authority, the LBA, issued it a Part 145 repair station certificate under European Joint Aviation Authorities rules. This certificate permits the carrier to accomplish checks up to the C level. With the certificate in hand, the staff of 100 at Croatian Engineering and Maintenance began C checks on two Lufthansa aircraft.

Homegrown training

The dot com industry is getting stronger in Croatia. The aviation business is suffering. Like everywhere, it is difficult to cope with the problem of keeping good technicians in the airline business when jobs in the dot com industry pay better.

Croats set up a college-level school to train technicians for airline maintenance departments. Technicians at the four-year college across the street from the Croatia Airlines maintenance facility in Zagreb get on-the-job training and refresher courses in well-equipped classrooms at Croatia Airlines. Some students have been hired by the Lufthansa Technik maintenance facility in Shannon, Ireland.

One of the school’s major tasks is to teach Croatian technicians technical English. Their philosophy is that it is much cheaper to produce technicians able to speak, read, write, and express themselves in English than to translate manuals, service bulletins, etc. into the native language.

The Croatian point of view is that education is a necessary and important part of business, and a great investment for the future. Many airlines would see education as a cost. In Croatia, it is different. They see it as efficiency improvement.

There is one interesting thought that somebody (not in the airline business) in Croatia told me when he was pointing to efforts to try to change the mentality of people in the country of Croatia: "For many years, we were learning from our mistakes, while Americans were learning at Stanford University, British at Cambridge, and Germans at Heidelberg. We can proudly say that this is changed now."

Croats are even thinking of establishing a pool of technicians that would be able to travel worldwide and accomplish any task for any airline on any type of aircraft.