The Kotor–Lovćen cable car, which commenced operations on August 14, 2023, has established itself as a key asset in Montenegro’s tourism sector, surpassing initial expectations three years post-launch. In 2025, the cable car transported over 430,000 passengers, with projections indicating even higher numbers for 2026. Approximately 95% of these visitors were international tourists, contributing significantly to the local economy. The Montenegrin government received €603,920 from the operator as part of the concession agreement for that year.
This project represents a private investment of around €20 million and has evolved into a tourism cluster that enhances connectivity between Kotor, Lovćen, and the broader Cetinje region. The cable car operates under a 30-year concession agreement with a consortium including Novi Volvox and Italian manufacturer Leitner, which committed to the initial investment while agreeing to remit 15% of net profits to the state.
The financial returns from this initiative are becoming evident, as demonstrated by the €603,920 concession payment based on an estimated profit base of over €4 million for 2025. While this figure is substantial relative to the original investment, it is essential to note that various factors such as capital expenditures and financing structures influence overall profitability.
Under local government financing regulations, 70% of concession revenues are allocated to municipalities where the concession operates. The distribution indicates that approximately €423,000 will be available for local use in Kotor and Cetinje based on the 2025 payment. This model allows local governments to benefit directly from tourism revenues rather than relying solely on indirect economic impacts.
The cable car also plays a vital role in local employment, with around 300 people employed in related services. This development fosters a new economic base through payroll contributions and stimulates additional spending in restaurants, retail shops, and other tourism-related businesses.
International interest in the cable car is strong; foreign tourists comprised about 95% of visitors in 2026. Notably, travelers from the United Kingdom accounted for approximately 40% of these visitors. Other significant markets include the United States, Israel, Germany, the Netherlands, Turkey, and France. These figures highlight Montenegro’s reliance on international tourism, which recorded 2.73 million arrivals and 15.37 million overnight stays in 2025.
Montenegro’s tourism model has traditionally concentrated on coastal destinations; however, the Kotor–Lovćen cable car seeks to address this imbalance by connecting coastal areas with mountainous attractions. The cable car spans approximately 3.9 kilometers and ascends over 1,300 meters in elevation within an 11-minute ride using 48 gondolas capable of transporting up to 1,200 passengers per hour.
This infrastructure offers a unique opportunity for tourists to experience both coastal and mountain environments quickly. As cruise tourism grows—Montenegro welcomed nearly 500 cruise ships carrying over 630,000 passengers in 2025—the cable car provides an alternative excursion option beyond Kotor’s Old Town.
Furthermore, the cable car’s commercial strategy has expanded beyond transportation to include various attractions at its upper station. New offerings such as Montenegro’s longest alpine coaster and additional activities enhance visitor experiences and increase revenue potential per visitor.
The success of this project could lead to further developments in Montenegro’s tourism infrastructure. Plans for a Lovćen–Cetinje cable car section aim to create a continuous tourism route linking coastal areas with cultural sites in Cetinje. Estimated costs for this extension range around €49.56 million excluding VAT.
Linking Lovćen directly to Cetinje could transform visitor flows and enhance economic activity within these regions. Currently underrepresented in tourist traffic compared to coastal areas like Budva and Kotor, Cetinje has significant cultural assets that could attract more visitors if connected through this infrastructure.
The ongoing development must consider existing infrastructure challenges in Kotor and surrounding areas. Seasonal traffic congestion remains an issue during peak tourist periods; hence effective management strategies will be essential as visitor numbers increase.
Ultimately, the Kotor–Lovćen cable car illustrates a shift in Montenegro’s tourism strategy—transitioning from merely increasing accommodation capacity to enhancing visitor experiences and economic value derived from each tourist interaction. With high international demand already evident, future developments could further solidify Montenegro’s position as a diverse tourist destination.
