Peter Hill, Oman Air’s new CEO, talks to Jan-Aslak Stannies about starting afresh
With Oman aiming to attract over 12 million tourists by 2020 despite the global economic crisis, Oman Air is continuing to unveil new products and services in a bid to support the country’s tourism growth. The airline’s CEO Peter Hill, who is confident of transforming the carrier into a world-class airline, speaks to TTN.
You took over when the airline was restructuring, now there is a downturn. How are you facing the challenges?
Oman Air was a regional carrier alongside the national carrier and had to fill the gap very quickly after Gulf Air pulled out. To redevelop yourself is much more difficult than to start fresh, because you have a lot of legacy and history. When you start to go into a different market like long-haul or a more up-market product, there is a lot of training and recruitment to be done, a lot of acquisition of aircraft and equipment to be made. And when you suddenly find yourself in the biggest recession the world had to face in many decades, you have an even bigger challenge.
So what do we do? We can’t change the time we have to take on the new aircraft and we wanted to introduce the routes anyway. So we just have to bite that bullet.
This month you launch routes to Frankfurt and Munich. Why the focus on Germany?
We identified Germany as being a large contributor towards leisure traffic into Oman. It is also a market we have immediate access to, because we already have fairly liberal traffic rights with one flight per day. It is probably the strongest point of origin destination outside the UK hence we have four flights to Frankfurt and three to Munich.
There has been much interest from tour operators, they also like the idea of linking Oman with the Maldives – similar destinations in terms of attractiveness to the clientele we are looking at.
We also expect to see Germany as an outbound leisure destination from an increasing number of young Omanis who are becoming more adventurous and wanting to travel.
What is your advantage when competing directly with Lufthansa, British Airways and Air France?
All of those carriers have a very European product and they all operate via a point – we are flying non-stop. When you see our product offering, these carriers will have a hard job matching it.
We are a late entry in the market and people need to find out about Oman and Oman Air, so we got in very aggressively.
What will your A330 product look like?
We have got a business class cabin, which, in every other airline I have travelled with, would be their first class product. It will only have 20 seats with four seats per row – our competitors have six.
Our seat pitch is 82 inches, with a fully flat bed, a purpose built seat for Oman Air. It features all of the latest in-flight entertainment and communications equipment. The economy class will have a 34-inch seat pitch, a 10 inch monitor.
Our whole rational is putting things in our cabin that you don’t expect to be receiving anymore. Our cabin crew will have new uniforms, there’s a new menu – everything has been redesigned to kick off in October with the brand new aircraft. All of that will later translate into the B737, which we are looking to upgrade with the same look and feel of the A330.
Where do you see Oman Air in a market with several strong network carriers?
Traditionally Oman has made it very easy for other carriers to come into our home market and take business. We will have to see how well we are able to recapture that and how much of an attractive destination Oman becomes over the years. We are not looking to take away the hub concept and traffic flows that have developed through Dubai, Abu Dhabi and Doha.
We see our niche in flying into and out of Oman as a genuine destination or for a stopover. Our second opportunity would be to feed destination like Maldives, Bangkok, Sri Lanka or Kuala Lumpur which we are planning to fly in March 2010. Our objective is to have a sustainable product over the next few years. I am looking for a break-even within five years – we can’t do that when we are opening up new services every week.
What other destinations are you planning for 2010?
Primarily, destinations that fell after Gulf Air pulled out. Oman Air has not filled that vacuum yet, but it has plans. Iran is an interesting market and we see opportunities in places like Kathmandu, where there is a good mix of business and leisure traffic. Also, we are going to Dar-es-Salaam next summer.
What are your plans for the expansion of the domestic network?
The government is developing four to five airports in Oman mainly for townships, industrial sites and leisure destinations within those regions. They will be coming on line around 2011 and 2012, so we will be starting services into those places too.
A hotel? Do you have plans for more or was this a one-off?
It was an opportunity, just here up the road to Muscat. We are growing our leisure facilities and it is the first hotel that the group has acquired. It will be fully owned by Oman Air and is managed by Golden Tulip at the moment.
Whether it keeps this name or not, we will see. We are doing an audit and are talking to the current management. The hotel needs investment and we have to brainstorm ourselves where we see that investment going. We have to decide what star property we want, and what is best for us and the Destination Management Company we are developing. Currently the hotel is profitable – that helps.