Travel Transportation in Eastern Europe

April 2018

Travel transportation in Eastern Europe returned to growth, influenced by Russia’s recovery. Airlines are driving the increase in sales, but scheduled airlines are strongly challenged by low cost carriers, which are eroding their share. Bus and rail transport sees mixed developments, influenced by a less competitive position and outdated infrastructure. The region is expected to see a positive performance, supported by favourable micro and macro environments.

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Reduced travel transportation market size considering the global level

Eastern Europe is second to last in terms of travel transportation sales when compared to other regions. The category’s positive dynamic over the previous years was influenced by the economic recovery, a growing middle class, or the extending of the visa free regime, Ukraine and Georgia being the latest additions. Leisure and business travel and diaspora movement also supported sales.

Russia is the dominant market in Eastern Europe

Benefiting from its large size and population, Russia generates half of the travel transportation sales in Eastern Europe. As a result, the region’s dynamic is influenced by Russia’s performance, this being very visible over the previous years spent under economic sanctions. The context also leads to Russian airlines being the largest players in travel transportation, however, with concentrated sales in the domestic market.

Airlines lead growth with low cost carriers rising strongly

The airline landscape is seeing changes. Low cost carriers have expanded to reach new markets and new destinations, offering more affordable prices in return for fewer comforts. The popularity of Wizz Air and Ryanair puts them among the few top airlines with a competitive regional presence. As a result, scheduled airlines have had to adapt by improving their service, pricing and overall strategies.

Positive forecast for travel transportation

Among other reasons, this is the result of the ongoing positive consolidation, with recovery in countries such as Russia and Ukraine, or continued strong progress elsewhere (Romania, Poland, Hungary, Georgia, Serbia, etc.). The new economic environment will favour the increase in travel spending, while current and future investments in infrastructure show that the region is shifting up a gear to become more competitive and open, offering a solid structure for growth.

Introduction

Scope
Key findings

Regional Overview

Eastern Europe’s travel transportation grows from low base
Positive trend consolidation, with favourable dynamic in Russia
Scheduled airlines recover while low cost carriers continue growing
Airlines lead travel transportation sales in developing markets
Low cost carriers strengthen positions
Airlines see most consumer interest, leaving other transport behind
Other travel transportation faces airline pressure
Low cost carriers are taking over airlines in the region
Airlines capture most travel transportation growth
Low cost carriers expand their travel transportation offer

Leading Companies and Brands

Top companies increase value share in most countries
Clear dominance when entire region is considered
Market concentration with only few regional top players
Aeroflot dominates, with all other followers fighting for their positions

Forecast Projections

Steady growth in travel transportation sales over forecast period
Investments in infrastructure and favourable macro environment

Country Snapshots

Russia: market context
Russia: competitive landscape
Poland: market context
Poland: competitive landscape
Czech Republic: market context
Czech Republic: competitive landscape
Hungary: market context
Hungary: competitive landscape
Romania: market context
Romania: competitive landscape
Ukraine: market context
Ukraine: competitive landscape
Croatia: market context
Croatia: competitive landscape
Bulgaria: market context
Bulgaria: competitive landscape
Slovakia: market context
Slovakia: competitive landscape
Slovenia: market context
Slovenia: competitive landscape
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