Rated as a very safe airline, the privately-owned Ukraine International Airlines – the nation’s top carrier with flights to 38 nations – faces a new challenge in its nearly 28-year history: Its first fatal plane crash.
UIA’s owners, fleet
Based in Kyiv’s Boryspil International Airport, UIA used to be the national carrier, with Ukraine’s government owning a 61.6% stake. But in 2011, the government sold its shares for modest $36.2 million. Initially, nobody knew the names of the new owners. Only four years later was it revealed that Israeli businessman Aron Mayberg and Ukrainian oligarch Ihor Kolomoisky obtained the largest shares in the company.
Mayberg and Kolomoisky operate UIA through companies Capital Investment Project and Ontobet Promotions.
Capital Investment Project owns 74%. The company, in turn, is cross-owned by five beneficiaries; a Cyprus-based company, Ontobet Promotions, often linked to Kolomoisky, owns the rest of the UIA shares, 26%. In 2019, Kolomoisky mentioned that Pavel Ovcharenko, CEO at Ukrtatnafta, which operates the largest oil refinery in the country and also owned by Kolomoisky, also has shares in UIA.
Mayberg and Kolomoisky owned Ukrainian airlines AeroSvit, which filed for bankruptcy in 2012.
By the end of 2019, UIA possessed 42 planes, compared to just two planes in 1992. Currently, UIA’s fleet consists of 27 Boeing 737, three wide-body Boeing 777-200ER, four Boeing 767-300ER, and seven Embraer planes. The fleet makes about 1,100 weekly flights.
Oligarch Ihor Kolomoisky talks to journalists at the Yalta European Strategy conference (YES) in Kyiv on Sept. 13, 2019. During the annual conference, Kolomoisky mentioned that he owns 25% of the shares in Ukraine International Airlines (UIA). Kolomoisky told journalists that Pavel Ovcharenko, CEO at Ukrtatnafta, has shares in UIA as well. (Matthew Kupfer)
Financial problems
In 2018, the carrier transported 8 million people. But financial problems are also part of the history. In March 2019, UIA reported a net loss of $100 million in 2018. In addition, Andrii Yarmak, the head of the state air traffic regulator of Ukraine, said that UIA owes $41.6 million in fees, penalties, and other payments.
Ex-head of UIA Yuri Miroshnikov said that the airline was struggling because of competition from low-cost carriers as well as high fuel prices and excise taxes. According to Serhiy Kuyun, director of A-95 Consulting Group, UIA annually overpays $7-8 million on fuel due to excise taxes absent in the European Union.
In addition, UIA spent $20 million on four new Boeing 777-200 aircraft.
UIA representatives also named the closure of the Russian airspace in 2014, after the Kremlin launched its war on Ukraine, as harmful. The company consequently shifted to riskier routes, like the one with Tehran.
UIA also started charging its customers fees for oversized baggage and stopped including meals in the price of a ticket.
According to British-based consultancy Skytrax, UIA is a two-star airline out of the highest five stars. Inflight entertainment and seat comfort were named as the weakest factors. “The worst flight I ever tried” is a common review on Skytrax website.
