Gulf Air may just have a future

11 September 2009

Majali hopes to prove that the airline can be more than just another basket-case flag carrier

Gulf Air is not alone among the Middle East airlines in receiving subsidies. The majority of national carriers across the region are still bankrolled to a substantial degree by their respective governments. Most would be bankrupt in five minutes if forced to operate on a purely commercial basis. The most successful carriers in the region, however – Emirates, Etihad and Qatar Airways – all deny receiving any form of subsidy.

Samer Majali, Gulf Air’s new chief executive officer, has made it his task to place the airline within that elite group of supposedly financially independent Gulf carriers.

The revelation that Gulf Air still receives $200m a month in state aid underlines the scale of the task facing him. The company is overstaffed and in a deep financial hole, losing about $1m a day.

Much is expected of Majali, but there is little doubt within the company or Bahrain’s political establishment that Gulf Air has chosen the right man for the job. There is none of the animosity towards him that blighted the brief tenures of Andre Dose or Bjorn Naf, his predecessors since 2007.

The cabal of MPs who spent most of the time those two men were at the airline briefing against them are notable by their silence this time round.

National airlines still inspire great loyalty. Allowing them to fail is unconscionable for most governments, and Gulf Air is no exception. However, Majali hopes to prove that the airline can be more than just another basket-case flag carrier draining the national purse. It will take time, but he has the track record to suggest it can be done.

Gulf Air will not beat the big three carriers of the region, but under Majali it could eventually join them.

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