MARK PILLING LONDON
Royal Jordanian Airlines aims to seal a codeshare deal with a US carrier by July in what could be a key move in
kick-starting its long-delayed privatisation later in the year.
July is when the carrier's first Airbus A340s arrive allowing it to compete effectively with European rivals on routes from Amman to New York. At present it operates A310s, which have to take a refuelling stop in Shannon, Ireland, says chief executive Samer Majali. All nine A310s will be phased out, with two being converted for cargo use, two being sold while the remainder are on leases that will be not be renewed.
Royal Jordanian will initially take delivery of two ex-Air Lib A340-200s operating out of Amman. The first will fly non-stop to New York, with the second serving Bangkok. Majali says that codeshare discussions are taking place with Thai International for this route, and with Malaysian Airlines for Kuala Lumpur services.
Majali hopes the codeshares will help to revitalise its long-haul network, helping to make the airline more profitable and more attractive to one of the global alliances and investors.
After debt restructuring in the late 1990s, Jordan aimed to privatise its flag-carrier with a 40-49% stake going to a strategic partner, preferably another airline. Majali says the move has been delayed after 11 September, and he is concentrating on getting the carrier back into shape before the search resumes. It was registered as a private firm in February last year, with the government as sole shareholder.
The re-shaping of the airline will include increasing its five-strong A320 fleet to 10-12 aircraft, or replacing it with the Boeing 737NG. A decision is due by mid-year. Staff levels have fallen from 5,500 to 3,500, with the sale of non-core assets such as flight kitchen. There will be 500 furloughs, he says.
The carrier expects to show an operating loss of just under $20 million for 2001, but Majali hopes to reach operating break-even this year. No aircraft were grounded during the crisis, with the airline preferring to reduce frequency on some routes and to absorb the capacity by operating triangle services in Europe - although Majali admits this does harm the ability to make east-west hub connections at Amman. It is offering travellers cheap deals for overnight stays in Jordan by way of compensation.
Source: Airline Business