After years of being dominated by full-service airlines, the first attempts to develop operations more relevant to specific market segments are emerging in the Middle East.

Gulf Air is launching an all-economy airline from Abu Dhabi, while start-up menaJet is planning a low-cost operation from Sharjah, also part of the United Arab Emirates.

Gulf Traveller will operate six of Gulf Air's nine Boeing 767-300s in a single-class with 257seats to destinations in the Indian subcontinent and Africa. Gulf Air stresses that the new carrier is not a no-frills operator, but will offer a full economy in-flight service.

Adopting an all-economy service on these routes fits market demand much better than Gulf Air's two-class offering, which featured 18% of capacity in business class, says Fareed Al Alawi, Gulf Air vice-president networks. However, the passengers on these flights are mainly local guest workers, and the airline was only selling 0.5% of these seats, he says.

By transferring the aircraft to one-class and by basing the aircraft in Abu Dhabi, Gulf Traveller lowers its unit costs and increases aircraft and cabin crew utilisation considerably, he says. From June, all six 767s will be operating on Gulf Traveller routes with 172 weekly flights to 17 destinations, says Al Alawi. Gulf Air is also considering expanding the concept to secondary European airports like Manchester and Munich, and to Johannesburg in South Africa.

Investors from Bahrain and Saudi Arabia are seeking to raise the finance to launch what would be the region's first low-cost airline. Their aim is for menaJet to begin operating two Airbus A320s from Sharjah in December.

The main shareholders in menaJet are Bahrain's Gulf Finance House and the Al Zamil Group, a Saudi-based industrial company. It will be based on the Southwest Airlines and Ryanair business model, says menaJet general manager Mazen Hajjar, operating services within the region at first.

According to Gulf Air president James Hogan: "This is the shape of things to come. The introduction of low-cost or single class carriers in the Middle East market is inevitable."

Gulf Air has also stated its interest in operating to Baghdad, Iraq's capital, as soon as possible. n


Source: Airline Business