Aeroflot set to leave Soviet image behind

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the end of this year Aeroflot's logo will no longer bear the hammer and sickle - a symbol of the Soviet era most of Russia dropped over a decade ago.


MOSCOW -
But the giant state airline, which turns 80 this month, hopes the belated change will help banish the visions of scowling cabin staff and rickety planes its name conjures up for many travellers.

The new logo - still under debate - is part of Aeroflot's image overhaul, to include staff training in polite and efficient service and cheerier uniforms and cabins.

Founded in the early days of the Soviet era, Aeroflot (AFLT.RTS) has more than survived the Union's traumatic collapse 11 years ago.

The airline, flag carrier for the world's largest country, expects to almost quadruple 2002 net profit to $74.2 million and boost it another 35 percent to around $100 million this year.

And by the end of 2005, it should have a leaner and more fuel-efficient fleet, much of it foreign-made.

"For 70 years, Aeroflot was a state bureaucratic structure that did what it was told to do by the government," Lev Koshliakov, the company's deputy general director told Reuters.

"Today it's a shareholding managed by modern economic methods on the basis of our real market position."

Aeroflot rode out the global airline crisis that followed the September 11, 2001 attacks on the United States much better than its peers because it was less dependent on transatlantic flights and able to grab market share as its competitors cut flights to Russia.

AMBITIOUS GROWTH TARGETS

Koshliakov said the company intended to secure its ambitious growth targets by restructuring its fleet and cutting costs.

Aeroflot's fleet now consists of 27 Boeings and Airbuses along with over 100 Russian aircraft, some of which are grounded because they are old.


"We're just beginning the fleet restructuring project, but we hope it will eventually lead to a considerable reduction in leasing costs, about $100 million a year," Koshliakov said.

Growing financial prosperity has led to grumbles of discontent among staff, who earn anything between $400 and $3,000 a month, and feel they deserve a piece of the improving action.

Aeroflot began pay talks this month with unions representing a third of its 15,000 staff who are threatening to strike.

The dispute coincides with looming strike action at mining giant Norilsk Nickel and is another example of Russian workers flexing their collective muscle to squeeze more money from their employers.

Koshliakov was confident that a strike would be averted.

"We have no reason to think the threat to strike will be fulfilled, we are in dialogue with the unions to solve the problems," he said.

LEAVING BAD OLD DAYS BEHIND

Customers are slowly coming around to the idea that Aeroflot might have moved away from the bad old days of the early 1990s when the company had split into hundreds of tiny "babyflots", many operating just one or two planes.

Russian airline safety hit rock bottom during that period of economic chaos.

Industry analysts say safety has been a major problem since then because the vast majority of Russia's civil fleet was built before the collapse. Few carriers have the money to buy new planes or to modernise existing ones.

Aeroflot's head Valery Okulov has repeatedly urged the government to tighten safety standards and force bankrupt carriers out of business.

At least 10 crashes involving Tupolev 154s, the workhorse of the Russian fleet, were recorded between 1990 and 1995.

"I don't think they deserve their much-maligned reputation anymore, I fly to London from Moscow on Aeroflot rather than British Airways," said one Moscow-based foreign businessman, though he added that service could be "patchy".

Aeroflot, which usually offers cheaper flights, scored well on consumer Web sites, although again service was seen as its weak point.

Koshliakov said the company was struggling to change the perceptions of air travellers and of its staff.

"You have to understand that in Soviet literature and Soviet society no one was supposed to serve anyone else and so the most despised professions were the service ones," he said.

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