Air Arabia: Low-cost revolution in Middle East and North Africa

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Air Arabia, the UAE carrier, has for the past seven years continued to gain more wind beneath its wings in the Middle Eastern, North African and European skies. A low-cost pioneer in the Middle East, Air Arabia has carried more than 11 million passengers since its inception, and has two hubs in Africa: Casablanca and Alexandria.

Air Arabia’s decision to establish a low cost route between the Middle East and North Africa via Europe came in 2003. Again this year, and for the third consecutive year, its performance has been acclaimed by the World Travel Awards as the best airline group in the low-cost category in the Middle East. The prestigious award indeed strengthens the carrier’s position as a pioneer of low-cost travel in the region.

In a bid to make clients “Pay less” and ‘Travel more,” Air Arabia seeks to democratize the airline industry as well as the Middle Eastern and North African skies. “We allow people who used not to travel at all to do so between 5 and 6 times a year. We have created a market that did not exist in this part of the world,” says Adel Ali, CEO of Air Arabia.

With an occupancy rate of over 70%, officials of the airline have undoubtedly achieved their objectives: to fill “a void” and “serve the Arab world.” The carrier flies to more than sixty destinations from its hubs in Sharjah, United Arab Emirates (UAE), Casablanca, Morocco, and Alexandria, Egypt. More than 11 million passengers have so far been transported by the company since its inception.

Tugging behind AirAsia, a number one low-cost airline from Malaysia, Air Arabia offers the second lowest price per seat in the airline industry while remaining profitable, with a $123 million profit in 2009. The airline’s success is attributed to the “rigid cost-savings” in their operations: A fairly new fleet – the average fleet age being two and a half years – consisting of a homogenized single aircraft type, the Airbus A320, and an all economy class cabin fleet. These factors have contributed to Air Arabia’s lower maintenance and training costs.

Positioning: low cost-comfort

Arabia airline has the largest fleet of “Airbus 320” in the world. Currently composed of 25 aircraft, the company is soon expected to increase its fleet to more than forty. According Arabian Space, the airline’s new Egyptian hub, which has 2 aircraft, will count between 4 and 6 aircraft by the end of the year, while two more Airbus 320 will be added to the three aircraft in Casablanca before the end of 2010.

Despite its “Pay less. Travel more” slogan, Air Arabia strives to make comfort an integral part of its trademark. “Stretch in spacious 32 inch legroom” says another of its slogans. Insisting on “treating our passengers well,” company CEO Adel Ali noted at a press conference in Paris that his company had one of the best economy class cabins in the world.

Europe and the rest of Africa

The two hubs in North Africa, Casablanca and Alexandria, enable the company to serve 13 European destinations as well as Khartoum, the Sudanese capital. Air Arabia is also planning to invest more in Africa. “We are trying to move into the market”, says the CEO of the airline well aware of the potential the region holds, albeit its chaotic airline industry. “It’s an open option that depends on administrative matters,” he confided a few weeks ago. But before setting out to conquer Africa south of the Sahara, Air Arabia wants to consolidate its position in the Middle East. Air Arabia’s next hub, according to the CEO, will be in Amman, Jordan.

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