EXCLUSIVE: Air Arabia CEO says low-cost carriers will dominate aviation

19 September 2017

Carrier generated $71m in net profit in the first half of 2017

Low-cost carriers carry the bulk of passenger traffic in every region globally and they are the future, Air Arabia CEO Adel al-Ali told MEED on the sidelines of the Sharjah FDI Forum on 19 December.

The Sharjah-based low-cost carrier reported a net profit of AED158m ($43m) in the second quarter of 2017, bringing the carrier’s net profit for the first half of 2017 to AED261m, some 7 per cent higher than for the same period in 2016.

Al-Ali says he expects the carrier to sustain its performance in the remaining period of 2017 barring any worsening of the political climate or natural disaster in the geographies it operates.

“Our four hubs also enable us to diversify and distribute risks,” the executive says.

In addition to Sharjah, Air Arabia operates hubs in Jordan, Morocco and Egypt.

Al-Ali declined to comment on the impact of Flydubai’s recent move to offer 50 per cent discount on air fare this month in terms of their pricing strategy over the short-term. “I am sure every airline is pursuing what is best for their business,” he says.

Al-Ali says the expansion of the Sharjah International airport cannot come soon enough but that he is pleased with the recent improvements at the airport, including a new immigration process which ensured smooth passenger flow at the airport during the summer.

In March, Sharjah Airport Authority awarded US-based Parsons a project management services contract for the planning, design, construction, and commissioning of the Sharjah International airport’s expansion.

The budget for the expansion of the airport, understood to be around AED1.5bn ($400m), was approved earlier this year.

The project will include numerous facilities as well as the expansion of the passenger terminal building and the widening of roads to and from the airport. The planned expansion will take the airport capacity from 8 to 25 million passengers annually.

Parsons’ role will include oversight of the expansion work as well as the preparation of the tender documents. 

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