In recent years Monarch has struggled. In 2011 the group posted losses of more than £51m ($82m) and while it returned to profit last year the pretax figure was a lacklustre £17m ($27m).
In a bid to turnaround the group, Monarch performed a “strategic review” of its entire operations this year, concluding that the carrier’s future lay as a European low-cost carrier.
In line with this ambition the airline will be dumping its long-haul and charter services from April 2015, to “specialise on Monarch’s ‘heartland’ of scheduled short-haul European leisure routes”.
Monarch is also set to cut its fleet from 42 to 34 aircraft and replace the A320s and A321s it currently operates with a fleet of 30 737 MAX aircraft, which are to be delivered over two years from 2018. The group said the change will “provide a cost-effective and uniform fleet”.
Overall the group claimed the restructure, which has also resulted in 700 redundancies, will enable it to cut annual costs by £200m ($322m).
Monarch’s decision to focus on short-haul routes and become an LCC sits in stark contrast to the turnaround strategy being adopted at fellow European carrier Alitalia.
Etihad, which has taken a 49 per cent stake in the Italian carrier, has confirmed it wants to make Alitalia a premium brand. Furthermore, it has decided to focus on long-haul routes, introducing new routes and increasing Alitalia’s widebody fleet by a third.
It will be interesting to see how these two very different strategies pan out over the coming years.