After the government’s refusal to grant additional financial aid, Montenegro Airlines completely suspended its operations on December 26, 2020. 

Montenegro Airlines, state owned carrier or Montenegro, operated the last commercial flight YM103 between Belgrade and Podgorica on December 25, 2020. As a farewell gesture, air controllers gave the pilots of Embraer 195 to make a heart-shape course in the skies over the mountainous Adriatic state.

“The Montenegrin government’s decision to shut down our company will have a negative impact on the entire aviation sector in the country. We would like to inform the public that starting tomorrow, December 26, 2020, we are completely suspending all operations,” announced the carrier. 

The government said it had looked at all possibilities to keep the airline afloat, but the liquidation seemed to be inevitable. “We are fully aware of the consequences of Montenegro Airlines ceasing operations in a day or two”, said Minister for Capital Investment Mladen Bojanić.

The company had accumulated debt which increased with the collapse of tourist demand. The Montenegrin government reported the airline owing €1.2 million to lessors of its E195s plus another €600,000 relating to the engines, €500,000 to Belgrade airport, and €160,000 to air navigation organization Eurocontrol.

“We plan to establish a new company with founding capital from the government,” said Bojanić.  “We are well aware of what it means to shut down a company for this tourist season because it will take six to nine months to establish a new one.” 

“We will do our best to keep Montenegro Airlines’ slots at European airports. We will enter into talks with our European partners and their airports. The idea is for the new carrier to simply take over the slots on routes which are deemed viable. The new airline must be sustainable, or it won’t exist. We can’t establish a new company just for the sake of having a carrier, which would operate on the same principles as Montenegro Airlines”, the Minister said.

Nikola Vukicevic, president of the airline’s management board, said the closure of Montenegro airlines would cost the government €100 million and leave 360 people jobless, reported the Balkan Insight. 

In July 2020, the government granted Montenegro Airlines state aid worth €10.4 million. A month later, the air carrier was granted an additional €25 million financial support. 

Amid the collapse of Montenegro Airlines, Ryanair, Wizz Air, Austrian Airlines, and Turkish Airlines continue to serve Podgorica Airport. 

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Montenegro Airlines might ground its whole fleet due to severe financial losses.