Aeroflot Looks to Bolster Image After Crash

APPeople looking through a list of Aeroflot Nord passengers in Perm on Monday. The plane's flight recorders were badly damaged in the crash. Story, Page 3.
Aeroflot is considering an image-building campaign to win back passengers' trust after a deadly weekend crash ended its spotless 14-year safety record.

A Boeing 737 operated by Aeroflot Nord, an Aeroflot subsidiary, crashed Sunday after an engine apparently failed as it approached the Perm airport, killing all 88 people on board.

"We will make every effort to reduce unavoidable image-related losses so they don't lead to a massive outflow of passengers, and we will try to restore our reputation," Aeroflot deputy director Lev Koshlyakov said Monday.

He said passengers needed to be reminded that Aeroflot flies one of the youngest fleets in Europe — none of its planes is older the five years — and boasted a remarkably long record of 14 1/2 years without a major accident.

Koshlyakov said airline directors were mulling over the launch of an "informational campaign" to "convince those who doubt our reliability."

State-controlled Aeroflot seemed to take a first step toward damage control Sunday, when airline director Valery Okulov announced that Aeroflot Nord would no longer be permitted to use the Aeroflot name. He linked the decision to the crash.

Aeroflot acquired a 51 percent stake in Arkhangelsk-based Aeroflot Nord in 2004. While Aeroflot's fleet of around 80 planes is young, Aeroflot Nord's 40 planes are considerably older. The Boeing 737-500 that crashed Sunday was built in 1992.

Some aviation analysts cautioned that Aeroflot might struggle to keep passengers. "Despite the fact that the crash occurred at a subsidiary as opposed to the parent company, we still believe that it will have a seriously damaging effect on Aeroflot's image," state-owned investment bank VTB said in a research note to clients.

Michael Vochenkov / AP
An Aeroflot Nord Boeing 737-500 landing at Sheremetyevo Airport last year.
VTB predicted that many business-class passengers, especially on international flights, might abandon Aeroflot for other carriers. Western passengers are "very sensitive" about safety, said VTB analyst Yelena Sakhnova.

Sales of business-class seats on international flights generate 20 percent of Aeroflot's profits, she said, adding that Aeroflot charges the same for business class as its Western rivals.

Aeroflot — nicknamed "Aeroflop" in Soviet times for its dour flight attendants and bland food — has invested tens of millions of dollars into reinventing itself over the past decade with the help of consultants from McKinsey & Company and Identica, a London-based branding and design consultancy. In recent years, the airline has stood out for its friendly service and tasty meals as international rivals ruthlessly cut costs to cope with high fuel prices.

Aeroflot's previous major accident occurred in March 1994, when an Airbus jet flying from Moscow to Hong Kong plunged into the Siberian wilderness after the pilot's teenage son inadvertently switched off the autopilot. All 70 people on board died.

After Sunday's crash, it will take Aeroflot five to seven years of safe flights to restore passengers' confidence, VTB said. Sakhnova said the estimated time was not based on any specific research.

But Kirill Tachennikov, an analyst at brokerage Otkritie, said the fundamentals of Aeroflot's image remained intact and predicted that the airline would recover in six to 12 months. "I wouldn't make a drama out of the situation," he said. He said the airline's business would continue to grow during that time, but at a slower pace.

One example of a Russian airline successfully rebounding is S7, which has suffered three plane disasters since 2001. Aiding the airline's efforts to win back passengers was a decision to change its name from Sibir to S7. A S7 official declined to comment for this article.

Sakhnova said Aeroflot, as Russia's flagship carrier, could learn little from S7's experience because S7 was largely a domestic carrier.