What does 2010 have in store for Middle East airline brands like Emirates, Etihad, Qatar Airways and others?
As promised at the start of the year, SimpliFlying will be bringing you more Guest Columns from leading aviation practitioners around the world. Our first guest article of the year is written by Oussama Salah, who is an aviation expert based in Abu Dhabi, UAE. Being a Jordanian who flies around the region a lot and works in the sector, he shares with us his predictions for Middle East carriers in 2010.
The MENA region airlines bucked the global trend in 2009. It was the only region that had an increase in traffic and had the loss forecast dropped by 50% to half a billion. The region saw an increase in flights and in destinations.
2010 promises to be an exciting year for the region. Airlines in all segments are competing for a leading position.
Emirates facing the crunch?
Emirates remain the leader of the pack, with a brand that, by far has no rival not only in the region but globally. So far Emirates has shown a financial ability to finance its expansion without burdening Dubai. The problem Emirates might face is a tightening of credit due to Dubai World’s and by extension Dubai’s problems. And as previously mentioned on SimpliFlying, even a merger between Emirates and Etihad cannot be absolutely ruled out.
Etihad and Qatar Airways expanding?
Etihad and Qatar Airways are both embarking on an expansion spree, supported by oil revenues of their respective governments, a viable means as long as oil prices hold at their current levels. Needless to say both carriers have not turned any profit yet. On a service level and as a brand both are offering services that in some cases not only rival Emirates, but exceeds it.
Royal Jordanian merging?
Royal Jordanian, the first Arab Carrier to join an alliance (One World) and the second Arab Carrier to privatize and be listed in the Amman Stock Exchange, is floating the idea of a merger with another regional airline or European airline by mid 2010 as the means of sustaining growth. This may be easier said than done since the Government’s approval is crucial (holds 39.5% of the stock) and the other problem is finding an airline that is compatible with the RJA brand displayed in their new A319, A320 and A321 fleets in terms of cabin and IFE.
Gulf Air going regional?
Gulf Air is looking to restructure and reinvent itself as a regional carrier as opposed to an Emirates or Etihad clone. For that they have employed Royal Jordanian’s ex CEO, the same person that lead RJA to profitability, privatization and into an alliance. GFA has already made its first review and as a result returned the Leased B777 back to Jet Airways and confirmed a 20 A320 orders from Airbus with a delivery rate of one aircraft a month. A sticking point is the union that opposes any Bahrain nationals staff cuts. The union has thwarted several restructuring plans in the last 10 years.
Oman Air re-inventing itself?
Oman Air has lead the region with an new First, Business and Economy seating plus connectivity on their A330 fleet with a Thales IFE and Higher bandwidth SwiftBroadband platform to deliver GSM/GPRS and WLAN via OnAir., launching a new campaign of “The Change is Here” .
The LCC onslaught?
On the LCC front as Air Arabia launches its second international hub (Alexandria-Egypt) in 2010, it faces stiff competition from FlyDubai and a reemerging RAK Airways. In Kuwait Jazeera Airways departed form the LCC model and is offering Business Class similar to Bahrain Air. This sector is facing competition not only from within but from other Legacy regional airlines.
These are a few of the issues facing the region’s airlines and promises an even more exciting year.