Aeroflot Seeking Control of Sheremetyevo-2

State carrier Aeroflot is already feeling constrained by its newly opened Sheremetyevo-3 terminal and is looking to take over management of Sheremetyevo-2, Vedomosti has learned.

Aeroflot will not be able to move all of its flights into Sheremetyevo-3, since the terminal was intended to handle 9 million passengers per year, while the airline and its subsidiaries are expecting to have a passenger volume of 12 million. As a result, Aeroflot has asked the airport to let it manage Sheremetyevo-2 and Terminal E, which will begin operating in March, an Aeroflot manager told Vedomosti.

Mikhail Vasilenko, chief executive of 100 percent state-owned Sheremetyevo, confirmed that the proposal had been made.

Aeroflot is Sheremetyevo Airport's anchor tenant, providing 70 percent of its passenger volume, and it has always enjoyed a special status there. The carrier services all of its own flights, believing it does a better job, and several years ago Aeroflot began considering its own terminal: Sheremetyevo-3.

Construction began in 2005 and the joint stock company Terminal was created to develop the project. Terminal is majority owned by Aeroflot, with 52.82 percent, while state banks VEB and VTB have 25 percent and 22.18 percent, respectively.

Aeroflot had been planning to move into its terminal in 2007, but the date was pushed back. Last fall, the company said that by Feb. 6, 2010, the terminal would service 110 international and more than 60 domestic flights for Aeroflot, its subsidiaries and other companies. But the schedule fell through again.

Sheremetyevo-3 is currently handling just domestic flights. International flights will only be moved to the new terminal in late March because of shortcomings of "a technical and operational nature" that were uncovered while the facility was being tested, a source close to Terminal said.

There was not enough staff or equipment for service within the facility and parts of it remain unfinished, including VIP zones and business terminals for passengers on international flights, the source close to Terminal said. Over the New Year's holidays, Sheremetyevo was plagued with lines everywhere, including for boarding and baggage.

The airport does not like the idea of handing over Sheremetyevo to Aeroflot. "That's not entirely right in terms of developing the business," Vasilenko said. "It took the state a lot of time and effort to separate the airport and carrier businesses."

But Vasilenko said the airport had a counteroffer for Aeroflot: let it manage Sheremetyevo-3.

Both options are being discussed at the Transportation Ministry, sources close to Aeroflot and Sheremetyevo said. Svetlana Kryshtanovskaya, an aide to Transportation Minister Igor Levitin, declined comment.

If you give Sheremetyevo-2 to Aeroflot, the airport will be left hungry since that terminal is its main source of income, said a government source. But if they don't give it up, Aeroflot is threatening to leave for Domodedovo, taking 70 percent of the airport's traffic with it — and that's even worse, the source said.

Aeroflot chief executive Vitaly Savelyev has already discussed the possibility of moving across Moscow with the chairman of Domodedovo's board of directors, Dmitry Kamenshchik. Domodedovo is ready to take them, but only in two years — once it has finished work on a new terminal, an Aeroflot manger said.

Spokespeople for Domodedovo and Aeroflot declined comment.

At a board meeting Tuesday, Aeroflot's directors discussed a third option. They could find an independent managing company for all of the airport's terminals, one of the meeting's participants told Vedomosti.