The Air Arabia Group and the Armenian Government are working together to create a new low-cost carrier (LCC). It’ll become the country’s latest national carrier, but the first with the involvement of a well-known and successful airline. We examine what is happening.
The pair have signed a joint-venture agreement, like that launched last year between Air Arabia and Etihad Airways to create a new low-cost in Abu Dhabi. Speaking at the signing ceremony, Air Arabia Group’s CEO said:
“We see tremendous potential for Armenia in building its airline sector, which will add sustained value to the economy through job creation and the development of travel and tourism sector. We thank…the Department of Civil Aviation for their trust and we look forward to working hand-in-hand to develop the new airline, which will serve as a value-for-money air travel option for Armenians and visitors to the country.”
Stay informed: Sign up for our daily and weekly aviation news digests.
Armenia’s national airline
When it launches, it will be the country’s new national airline, something that the government has been eying since mid-2020. The last airline in this position was privately owned Armavia, which ceased operating in 2013 with significant debts. This came about in the wake of state-owned Armenia Airlines, which ended 10 years earlier.
Armavia and Armenia Airlines were all tiny and had no backing or experience from a bigger and successful player. The same is true of the nation’s current passenger airlines: Armenia Aircompany and Armenia Airways. This is partly where Air Arabia comes in, suggesting Armenia is keen on sustainability. However, it is still likely to have only a handful of aircraft, as befits a small nation.
The public will choose its name
Intriguingly, the startup’s name will be chosen from a list of proposals submitted by Armenian citizens by mid-August. This suggests that the obvious ‘Air Arabia Armenia’ name isn’t going to be used, perhaps because of geopolitical issues.
While nothing is yet known regarding fleet, network, or anything else, it will inevitably operate A320s (like all Air Arabia Group carriers), and no doubt use as much as possible from Air Arabia.
The Air Arabia Group this year
The new carrier will be the fifth unit within the Air Arabia Group of carriers, each with its own air operator’s certificate (AOC). A sixth, in Algeria, may materialize at some point, based on previous revelations. Each AOC exists to ensure the “substantially owned and effectively controlled” requirement in bilateral air service agreements is met.
Currently, the Group comprises the following airlines. Note that another, Air Arabia Jordan, previously existed but ceased a few years ago.
- Air Arabia: 57% of Group seat capacity this year, based on OAG data
- Air Arabia Maroc: 26%
- Air Arabia Egypt: 10%
- Air Arabia Abu Dhabi: 6% (but big growth plans)
Ryanair and Wizz Air to Yerevan
This development comes as Ryanair had put on sale – but subsequently removed – four routes to the Armenian capital: Berlin Schönefeld (as it then was); Milan Bergamo; Rome Ciampino; and Thessaloniki. Rome and Milan were inaugurated in January 2020.
It also comes as the Wizz Air Group is set to begin service to Abu Dhabi and Larnaca later this year, supplementing existing Vienna. It was previously suggested that London Gatwick would begin.
Where may the new carrier serve?
Crucially, the startup will have to contend with Armenian airlines being banned from the EU, at least for now. Turkey is, of course, also out of the question. Subject to bilaterals, this suggests that Russia, Ukraine, the Middle East, Egypt, and parts of Central Asia are the most likely to see it.
But ignoring the EU ban for this story, what are Yerevan’s largest unserved markets based on available booking data obtained via OAG Traffic Analyzer? These are shown in the above map. Note that this does not include the many underserved markets where 40%+ of passengers flew indirectly in 2019.
It’ll be fascinating to see how things develop. What are your thoughts on the JV? Let us know in the comments.