When the first flight of the newly established Air Arabia took off, in October 2003, from its home base in Sharjah, one of the seven Emirates making up the United Arab Emirates, not many predicted it would lead to the emergence of a novel and budding phenomenon in the Middle Eastern aviation industry. Up until the establishment of Air Arabia, which today flies to over 70 destinations and operates secondary hubs in Morocco and as of June 2010 in Egypt as well, Middle Eastern airlines, especially those from the Gulf region, had been almost synonymous with luxury and elegance.
But over the last few years, a new type of airline has taken off in the region, the low cost carrier. The success of Gulf-based legacy airlines was evident when the British market research firm Skytrax announced the world’s top 10 airlines in 2010, based on passenger reviews. Qatari national airline Qatar Airways made number three, followed by Etihad Airways from Abu Dhabi (UAE) at number six, and Emirates Airlines from neighboring Dubai at number eight. With the enormous popularity of Middle Eastern luxury airlines, how did Air Arabia become such a huge success story? “When Air Arabia started, it targeted the segment of the UAE expatriate population that never used air travel,” Oussama Salah, an aviation expert based in Abu Dhabi, told The Media Line. This segment was made up of, “the people that used the bus to go back to Syria, Lebanon, Jordan or Egypt.” “It did this by offering rates slightly higher than buses and much lower than the legacy airlines of the region,” he said. “The idea was for a few hundred extra dirhams we can get you there safely and save you two to three days of travel in the desolate Saudi desert with its many accidents,” Salah said. “As things progressed, the low cost carriers became more attractive to middle-class professionals who were able to travel several times to their countries a year instead of once a year because of lower fare,” he explained. “It also opened up intra-Gulf traffic, fueled by low fares, so that families could make day trips to Dubai, Sharjah, Bahrain, Doha by offering frequency [in flights],” Salah said.
While Air Arabia is a pioneer in the market, over the last year they have been facing fierce competition from Dubai-based low cost carrier flydubai, which has gone from nothing one year ago, to now operating 21 destinations with 13 aircraft and another 37 to be delivered. Nine of these routes were added recently in May 2010. Philip Butterworth-Hayes, an aviation expert and the editorial director of PMi-Media Ltd, told The Media Line that it is not a big surprise that low cost aviation has been so profitable in the Middle East given its success in other parts of the world.
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