Mideast carriers are in for the long haul

Connectivity is key for any major hub to survive today's testing times in the aviation industry.

Connectivity is key for any major hub to survive today's testing times in the global aviation industry.

What tips the scales in favour of the Middle East is its central location, which serves as a gateway between Europe, Asia and Australia, effortlessly connecting traffic flows from each region.

Dubai is the pioneer in this venture, with the Emirates homebase benefiting the region in its bid to attract 400 million passengers in the coming years.

Paul Griffiths, CEO, Dubai Airports, said earlier: "The Middle East is forging ahead, and within the next few years the collective capacity of airports in the region will reach 400 million passengers, with Dubai constituting 50 per cent of the total." He added that while global aviation growth rates have slowed to less than two per cent, the Mideast is clocking rates of seven per cent.

"The pace of the growth we're seeing is frenetic thanks to capacity increases, improving economic conditions and rising consumer confidence," he added.

In the past six months alone, Mideast carriers between them have launched over 35 new destinations and have another 50-odd cities waiting to be announced.

Meanwhile, Sharjah-based Air Arabia has taken this a step further by launching three other hubs, in Morocco, Egypt and now Jordan to increase its reach.

As this growth curve continues to bear fruit for the region, Emirates Business analyses what lies ahead.

New destinations

- Amsterdam

Emirates' 23rd route into Europe is a daily, non-stop service from Dubai. Naturally, party revellers are jumping with joy considering 'Dam's nightlife is legendary.

- Barcelona

Footie fans can take delight in Qatar Airways' daily flights to the Catalonian capital, home to FC Barcelona.

- Copenhagen

Qatar Airways scores again, this time with its four weekly flights to the capital of Denmark. While Danes are cheering, the airline, which serves neighbouring Stockholm, aims to boost capacity on that route too as it goes daily.

- Madrid

Emirates will jet into the Spanish capital with a daily, non-stop service from August 1. While Spain continues to be a popular destination for UAE residents, Emirates also aims to serve Dubai as a hub for travellers from Europe looking to journey onwards to Asia and Far East.

- Buenos Aires and Sao Paulo

Last week's daily flights to the South American cities will certainly drive up demand until the Brazil 2014 Fifa World Cup rolls around, not to forget the annual carnival either.

- Tokyo

If there was ever time for a summer price war among Mideast carriers then the Japanese capital is it. Emirates, Etihad Airways and Qatar Airways have launched Tokyo flights. A must this summer.

Something to fit every budget this summer

As the region's market gains maturity, over the past few, years the Middle East has witnessed strong growth in the low-cost carrier market. According to Centre for Asia-Pacific Aviation figures, budget airlines provided 8.3 per cent of seat capacity in the region in 2009, up from 2008's 7.4 per cent.

Sharjah-based Air Arabia was the first low-cost carrier to launch operations here, and since, 10 other budget airlines have been established in the Middle East. For cash-crunched travellers, this has only spelled good news, considering increasing competitiveness has given rise to aggressive route expansion.

This summer alone has seen one-year-old flydubai spread its tentacles into the Indian Subcontinent by launching flights to Lucknow, Colombo and Karachi.

Kuwait's Jazeera Airways may have scaled back its India operations but with the launch of Lahore in May, the carrier realises the potential of the Asia region.

Meanwhile, Air Arabia's strategy continues to target Africa and Europe with its ever spreading hubs. The airline launched its Egypt hub earlier this month in a joint venture, just in time to provide cheaper connections to European destinations over the busy holiday period. To sustain the heavy inflow of traffic, the carrier has also added additional flights to Amman, Damascus and Alexandria; and not to forget extra ones for its Goa route.

Rumour has it…

- Washington DC and Seattle

Emirates has always maintained that the United States has been one of its most lucrative routes, prompting the return of the A380 to New York from October. Officials have said further American routes are on the cards and the US capital, along with aviation hub, Seattle, seems the obvious choices.

- Amritsar, Jaipur, Pune and Goa

Low-cost carrier flydubai has gone on record that the Indian Subcontinent fits in with the airline's expansion plan. Last year, flydubai had even gone ahead and announced Lucknow, Coimbatore and Chandigarh before calling it off citing operational problems. After the launch of Lucknow, rumour has it Amritsar, Goa, Jaipur and Pune will follow suit.

- Hong Kong and Shanghai

Etihad is targeting China and how. The official Xinhua News Agency in the mainland has already reported Shanghai should launch 2011 or 2012. Hong Kong is expected to follow.

- Cyprus

Antonis Paschalides, Cyprus Minister of Trade, Commerce, Industry and Tourism, said earlier that Air Arabia has already received the rights to fly to Cyprus and should launch by Q4 2010/Q1 2011 from its Sharjah hub. He added: "Kuwait's Jazeera Airways has also received rights, but have delayed the launch, while flydubai has been given rights too."

The big 5 get ready for aggressive expansion

Emirates: With its whopping order of 32 superjumbos earlier this month, Emirates has taken its order of A380s to a total 80 aircraft, with another 10 already in service for the carrier. Add to that are 70 A350s, 18 Boeing 777-300s and seven Boeing air freighters, bringing the value of the 143 aircraft order book to a whopping $48 billion (Dh176bn). Emirates' expansion drive is giving competition a run for its money.

Etihad Airways: The Abu Dhabi-based carrier has 106 planes in its order book, while 50 are in currently in service. According to UBS Investment Research, by 2017 Etihad Airways is expected to jet into 100 destinations, adding another 42 new destinations to its route network. If this growth continues, by 2020, this would indicate the airline would require at least 155 aircraft in its fleet, said UBS.

Qatar Airways: The Doha-based airline operates a hub and spoke network, linking more than 85 international destinations in 53 countries. Furthermore, since its re-launch in 1997, Qatar Airways has grown from four aircraft to 76 aircraft in 2009 and will have close to 90 planes in its fleet by the end of the year. The carrier has another 182 aircraft on order, comprising both Boeing and Airbus fleet.

Flydubai: With its investment capital doubled to Dh500m earlier this month, CEO Ghaith Al Ghaith has maintained the carrier should double its route network by 2011; the airline currently operates to 21 destinations, with its latest, Colombo, launching last week. Flydubai plans to take delivery of its 13th aircraft by year-end, with another 37 on the order book, which are scheduled to join the fleet by 2016.

Air Arabia: The carrier has outstanding orders for 44 A320s, with six being delivered in 2010 and another six to follow in 2011. According to a Capa report, Air Arabia Maroc will take delivery of two aircraft this year, and if market conditions are good, will receive three aircraft per annum to reach a fleet of 17-20 aircraft, similar to its Sharjah operations. However, more orders could be on cards as it announced a hub in Jordan.


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