New Middle East chiefs ready to make their mark

Jeddah
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Recent movements in senior management at three of the Middle East's most established mid-sized carriers mean there are new facesguiding carriers with quite different challenges.

The man with the biggest-looking task ahead is Samer Majali, having left the calmer waters of Royal Jordanian Airlines to take on the challenge at Gulf Air. The latter has struggled to define its role, seemingly caught between matching the aspirations of its ambitious Gulf carrier rivals and others in the region that have found their own niches.

"It's a company with a long history," acknowledges Majali. "What needs to be done is to relaunch the Gulf Air product, the broad definition of it, and that's what I am looking at now." While this process is still ongoing, the carrier's movement into Iraq could point to possible future strategy. Majali, who took the helm in the summer after replacing Bjorn Naf, wasted no time in giving the green light to expand its Iraq network to five routes.

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 ©Billypix
"We are all chasing the same traffic," he says, noting 80% of Gulf traffic is transit. "So we are searching for new points that will allow us to connect, points that will give us a leadership role," he explains. "The longer-range strategy is to improve our third and fourth freedom traffic.That is not going to happen overnight. In the short-term it is searching for better quality sixth-freedom traffic."

Majali says some redeployment is possible and does not rule out contracting in the short-term, but still sees growth as fundamental in the long-term. "Contracting is not a solution [in the long-term]. You have to grow, but grow in the areas that have the best options."

Jordanian strategy

Majali's move to Bahrain created an opportunity at Royal Jordanian for Hussein Dabbas, and the 30-year Royal Jordanian veteran is aiming to continue his predecessor's strategy of making it the "airline of choice" between the Levant and the west, by focusing on multi-frequency, regional jet services feeding long-haul flights mostly to Europe and North America from Amman.

The oneworld airline has used its five Embraer 195s and two 175s to increase services to cities such as Beirut, Cairo and Aleppo to several a day. At the same time, it has all but abandoned efforts to compete with the big names on routes to Asia, a tactic that forced it to discount and lose money over a long period, says Dabbas.

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"Rather than trying to take the passenger from Amsterdam through Amman to Bangkok, we focus on Amsterdam to Amman to Beirut," he says. "Jordan's good relationships with all the surrounding countries is an advantage for us. It means we can take, for example, the guy who wants to go from Aleppo [in Syria] to Montreal more comfortably than if he had to make two long-haul flights through a European hub."

Royal Jordanian had planned to start replacing its largely Airbus A340 and A310-based long-haul fleet with 12 Boeing 787s from next year. However, delays to the programme have forced it to look at refurbishing its A340s and even replacing the Dreamliners completely with A330s or Boeing 767s. "We are still committed to the 787, but this has screwed up our plans big time," says Dabbas.

Egyptair hub boost

Meanwhile new Egyptair Holdings chairman and chief executive Hussein Massoud has taken the helm of the group as it aims to build on last year's entry into Star Alliance and the opening this summer of the plush new Terminal 3 at its Cairo Airport hub.

It has been working with consultants Seabury on restructuring its network and has rejjigged its fleet plans accordingly.

"We have already finished the first phase and now we are working on the second phase to enlarge our network, with the co-operation of Star Alliance," explains Massoud. "We are concentrating our co-operation with Star Alliance to be a hub for Africa. We have several points in east Africa and have more [to follow] and are selecting destinations in west Africa."

This has seen the carrier opt to switch an order for two Boeing 777-300s due in 2013/14 for eight more 737-800s. "I think this gives you a good indication that we are very serious about Africa and single-aisle and short-range [markets]," he says.

While he says growth over the coming years will be "mainly in Africa", he adds: "We are enlarging our network and increasing frequencies to destinations, like London, Paris and Frankfurt."

Groupprofits were down about 8% in its financial year to the end ofJune 2009 - a good result under the circumstances he says - and Massoud expects it to remain profitable for the current year.

He says the carrier is sticking to its long-term plans and taken advantage of other airlines deferring aircraft deliveries to accelerate some of its own . For example it has asked Airbus to deliver its first A330-200 in August 2010, a year ahead of schedule.

While these long-term goals remain, an immediate priority for the carrier is to address safety concerns highlighted by the European Commission. While surprised to receive documentation from the latter this summer highlighting concerns stemming from inspections over the January 2008-May 2009 period, the carrier says it continues to work with the European authorities to address its concerns.

"We have been in close co-operation with them," says Massoud. "We took the remarks and we started working at it. So far we have had five inspections since the start of October, they have inspected five aircraft without any single findings."

Click here for our earlier cover interview with Samer Majali at Royal Jordanian