Air Arabia founder and CEO ADEL ALI speaks about the Sharjah based low cost carrier’s past year and its future.
How has 2008 fared?
This year has been another milestone one for Air Arabia: the company’s opened seven new destinations and increased frequency to existing ones as well as raised its operating fleet into 16 Airbus A320 aircraft. Air Arabia’s net profit for the most recent period, three months ending September 30, 2008, stood at Dh214 million, an increase of 30 per cent compared to Dh165 million during the third quarter of 2007.
We will commence our operations from our second hub in Casablanca, Morocco in early 2009, which will allow us to branch out into the wider Europe, Middle East and Africa (EMEA) market.
What impact has the current economic climate had?
Times have undoubtedly changed over the past 12 months and the financial turbulence currently impacting the international economy is a testament to this fact. Throughout this period, global economy has put additional pressure on everyone in the transportation sector, including us. However, Air Arabia has witnessed a sustained growth in its passenger traffic, passing the 10 million passenger mark this year.
What is 2008’s turnover?
For the first nine months of 2008, the company posted a net profit of Dh374 million, up 34 per cent compared to Dh280 million during the same period last year. For the same period, the company posted a turnover of Dh1,495 million, up 68 per cent compared to Dh889 million in the first nine months of 2007.
What is the future for low cost carriers in this region?
Expansion of the air transport sector has made it the fastest growing industry in the world. In light of the region’s booming economy since 2001, its share of international passenger traffic has grown from five per cent to 10 per cent. LCC are stimulating growth and globally they are the most profitable business models.
Regionally, air travel is the only means of state-to-state transport. In these economically challenging times and while still maintaining 50 per cent lower fares compared to full service airlines, the outlook for LCCs remains bright. Air Arabia continues to adapt upon the globally proven LCC model to the unique needs of this region.
What about airport facilities for low cost airlines?
At a time when Middle East air travel is growing at double the global average, the need for new airports – and especially low-cost, or secondary, airports – has never been greater.
Currently, many Middle East airports are underdeveloped or overly congested. As we move towards the full adoption of open-skies policies and with the highest number of aircraft on order anywhere in the world, the region must invest today in the infrastructure necessary to meet the demands of tomorrow.