Recently at the Dubai Air Show, Sharjah-based low-cost-carrier Air Arabia placed a massive order for 120 Airbus A320-family jets. The order includes 73 of the high-efficiency A320neo variants, as well as 23 A321XLR. This massive growth, along with other new deals, will hopefully allow it to compete with Dubai-based budget airline flyDubai.
Competition heating up in the Middle East
It feels like the golden age of the Middle East three has faded a little. Etihad has had to take 20 fewer Boeing 787 Dreamliners than originally ordered, as well as starting to charge for select snacks and drinks in economy class. The excitement has died down as Emirates awaits its new aircraft. At least Qatar Airways is reporting that it's stronger than ever after the sudden June 2017 blockade imposed on it by its neighbors.
What's stealing the spotlight in the region these days is the competition heating up between the low-cost-carriers of the Middle East. Kuwait-based Jazeera Airways just commenced its service to London and has a number of other new destinations launching in the near future.
Air Arabia is playing catch-up to flyDubai in terms of fleet size and reach. In fact, this seems like the perfect time to ramp up the competition - especially with flyDubai dealing with its 737 MAX situation.
What will growth look like?
With its hub located in the United Arab Emirates, Air Arabia can connect passengers flying from Western Europe and Africa through to destinations in India, East Asia, and Southeast Asia. This is made possible with its latest acquisition: The Airbus A321XLR. However, long-haul flights on A380s and Boeing 777s via Dubai are a drastically different experience than 12+ hours on a series of A321s via Sharjah.
Further growth could happen via its new partnership with Etihad as it cooperates to setup "Air Arabia Abu Dhabi". This will allow Etihad's extensive long-haul network to feed into Air Arabia's regional network and vice versa.
“Home to the first low-cost carrier in the MENA region, the UAE has developed over the years to become a world-leading travel and tourism hub. We are thrilled to partner with Etihad to establish Air Arabia Abu Dhabi that will further serve the growing low-cost travel segment locally and regionally while capitalising on the expertise that Air Arabia and Etihad will be providing”. -Adel Al Ali, Group Chief Executive Officer, Air Arabia
Conclusion
Only time will tell if Air Arabia's massive aircraft investment will pay off. It's certainly becoming a fairly saturated market when you consider the big Middle East three. Add to that the budget carriers of flyDubai, Jazeera Airways and the rapidly expanding Air Arabia and you wonder how full these planes can be.
Do you think there is enough of a market to sustain all of these airlines and their plans for growth? Or is consolidation and/or collapse inevitable for some of these carriers? Let us know by leaving a comment!