Following the successful negotiations between the Ministry of Transport and Communications, Lithuanian Airports and the airlines, Lithuanian Airports have signed an investment agreement with LOT Polish Airlines, which will operate direct regular flights between Vilnius (VNO) and London City (LCY) airports. The Contract will be implemented under a new route development model that will ensure the continuity of flights to the strategically important financial hub of London, which has been served for the last few years.
"London is a pilot destination for the new flight development model and we wanted to test how the model works. This convenient and familiar destination to the center of London is essential to meet the needs of Lithuanians living in London, businesses and visitors to Lithuania. It is a bridge between Vilnius and London, and we see that users on both sides are satisfied. I am delighted that we have been able to secure this route both in 2019 and now. It is a good example of cooperation between project management and national institutions. We hope that Lithuanian Airports will be able to use this model to secure other important destinations for the country," said the Minister of Transport and Communications Marius Skuodis.
Aušrinė Armonaitė, the Minister of Economy and Innovation, said that direct connections to priority countries are of vital importance both for our business and for foreign investors working in Lithuania.
"Flight to London is also good news for our community. Using the new flight development model, Lithuania will become even more attractive for job creation and inbound tourism," says A. Armonaitė.
Vilnius Mayor Valdas Benkunskas says that it is important for Vilnius to have good connections to London.
"London is home to financial centers of global importance. We want to see more international companies setting up in Vilnius and more good jobs, so we will look for ways to help increase demand for flights that are important for the capital," says the Mayor of Vilnius.
A convenient schedule
The Contract with LOT Polish Airlines was signed after an international selection process for a scheduled flight operator. The selection criteria included the requirement that the route be operated at time and frequencies convenient for business travelers. All the necessary qualification checks and coordination of the joint business plan were carried out prior to the signature of the Contract. The new model will commence on October 1st this year and will ensure uninterrupted services on this important route.
"This route is a prestigious project and a very strategic one in the context of the existing regular flights. From October onwards, the flight will continue to operate from Vilnius at very convenient time, which we believe will also contribute to its growing popularity. It is very important to understand that the country's investment in the development of priority flights is necessary, therefore, together with our partners, we will make every effort to ensure that the state budget will provide the necessary amount for the effective continuation of the development of the flights in the coming years as well," says Simonas Bartkus, CEO of Lithuanian Airports.
S. Bartkus stresses that the new flight development model is not a subsidy or grant to airlines. Under this model, both in this case and in the future, contracts will only be concluded with those airlines with which a financially viable business plan for a particular route has been agreed, both for Lithuanian Airports and airlines. The new model is based on a long-term partnership between Lithuanian Airports and the airlines operating the flights. Both parties to the Contract will bear the financial risks associated with the operation of the flight and will share the financial benefits generated by the flight. All the terms and conditions for sharing the financial risks and benefits are set out in the business plan between Lithuanian Airports and LOT Polish Airlines.
This new practice, he said, could provide a solid basis for future planning of the development of priority routes on a similar model.
It should also be noted that the capital of the United Kingdom is also among the priority destinations for inbound tourism, so a direct flight to the centre of London is an advantage in attracting more tourists to Lithuania. The possibility of a direct flight to London could serve as a catalyst for inbound tourism, with the right focus by Lithuania’s tourism representatives placed on demand stimulation.
Connecting to London is a priority
Until now, LOT Polish Airlines had been contracted under a different model (Public Service Obligation - PSO), but with the UK's exit from the European Union (EU), it was no longer possible to contract under such EU regulation.
Flights between Vilnius and the City of London were also operated by LOT Polish Airlines from May 1st 2019 until September 30th this year. This project was one of the few regulatory exemptions granted by the European Commission allowing an airline to grant State aid for the operation of a flight when the flight is recognized as a flight of special interest within the EU.
