KrasAir: Failed Union

KrasAir (Krasnoyarsk Airlines or Krasnoyarskiye avialinii) was formed from the two Krasnoyarsk elements of the local Aeroflot CAD to become one of the largest airlines in Russia in the mid-2000s. Led by the Abramovich brothers it bravely attempted to combine multiple Russian airlines together into a major new force, but as with many other airlines found itself unable to cope with the severity of the economic crisis that hit Russia in 2008.

The airline grew from the remnants of the 1st Krasnoyarsk UAD (operating IL-62, IL-76 and TU-154s) and the 2nd Krasnoyarsk UAD (operating AN-26s and Yak-40s) being privatised in 1993 and organised as a joint stock company of which the local government held 51%. Krasnoyarsk itself is the third largest city in Siberia (in Central Russia) with a population of over 1 million people. Kras Air under the leadership of its CEO Boris Abramovich built up a strong Russia wide network with the city as its main hub.

The airline was an early user of Western equipment when it leased a pair of DC-10-30s from McDonnell Douglas in July 1995 and April 1996 respectively, however the type proved too expensive to operate and the aircraft were returned in August 1997. Following this the fleet remained Russian with renewal moving at a slow pace. Indeed the airline's aircraft carried basic Aeroflot colours with Kras Air titles for much of the 1990s and in common with many of the Babyflots a unified branding wasn't particularly important to the carrier at this time.

It was during the early 2000s that Kras Air began to make a name for itself. It adopted a new largely fleetwide livery attractively arranged in blue and began to take stakes in other Russian airlines. A pair of TU-204-100s were delivered in the late 90s though it wasn't until 2003 that a third aircraft joined the fleet. Indeed at least one of the TU-204s and some IL-86s appear to have come from the purchase of the assets of Transeuropean Airlines (see here for their history). By 2004 the fleet contained 2 TU-134s, 6 TU-154B-1/2s, 11 TU-154Ms, 2 IL-62s, 4 IL-86s, a Yak-40 and the 3 TU-204s as well as 8 all cargo IL-76s.

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In October 2004 KrasAir and Domodedovo Airlines (see here for their history) set up a joint management company, Air Bridge. This was the first attempt at an airline alliance within Russia. Though both airlines kept their separate legal identities their networks and services were integrated. The alliance was renamed AiRUnion in 2005. By this time KrasAir had gained effective control of not only Domodedovo Airlines but also Samara Airlines, Omskavia and Sibaviatrans. Together the AiRUnion group could begin to make a concerted attempt to wrestle the number 2 spot away from Sibir/S7. On May 3, 2007 the five members of the AiRUnion alliance were rolled into a similarly named holding company, OAO AirUnion. Member airline's fleets began to wear the bright simple colours of AiRUnion with small titles of their original airline underneath.

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KrasAir's fleet also began to change. Kras Air acquired two new IL-96s: RA-96014 ‘Mikhail Vodopyanov’ and 96017 ‘Mikhail Reshetnyov’ which were built in 2004. Western types also began to join the fleet which by 2008 stood at 6 737-300, 4 757, 4 767-200ER, 4 IL-86, 2 IL-96, 15 TU-154 and 1 TU-214. By this time AiRUnion itself was transporting nearly 5 million passengers annually (compared to just over 8 million with Aeroflot).

Unfortunately the Russian economic crisis of 2008 hit the AiRUnion partnership heavily. Fuel costs rose astronomically to account for over 50% of the airline's costs. By June 2008 it was in serious trouble and both in that month and August there were temporary groundings due to unpaid fees. By the middle of August the airline owed 223 million Roubles and on August 19th its main fuel supplier refused it anymore service leaving thousands stranded. Propped up by the state operations resumed but the airline's troubles were insurmountable and it collapsed for good at the end of October ending the dream of creating a unified AiRUnion airline to challenge Aeroflot, S7 and UTAir.

The IL-96s did not find new operators until 2011 when they were converted into VIP configuration and joined the Russia State Transport Company. They continue to operate Government flights in a 147 passenger configuration.