The airline plans to break even in first year of operation with plans to have up to 10 new routes in place
Ras al-Khaimah’s RAK Airways will restart operations on 10 October with two new destinations and future plans to have up to 10 new routes in place in the first year of operations
Having suspended operations for more than a year, the airline will now offer four flights each week to both destinations, which include Jeddah in Saudi Arabia and also Kozhikode in India. The carrier will operate two Boeing 737-400 planes on these routes and is looking to acquire further aircraft in its first year.
RAK Airways was established in 2006, but was forced to temporarily withdraw regular operations at the end of 2008 due to the global economic downturn. It still continued to offer a charter service.
The carrier now has a paid-up capital of AED568m ($155m) and plans to break even on its operational expenses in the first year of operation through starting charter routes between Ras al-Khaimah and the east coast.
An initial public offering (IPO) is not an option now, but may be considered in the future if it is feasible and the right time to do so.
Tourism is the main driver behind re-launching the airline as Ras al-Khaimah plans to quadruple tourist numbers by 2012 and will also increase the number of five-star hotel rooms to 7,500 from 1,400 currently.
The UAE is currently home to four other airlines, including Dubai-based Emirates and Flydubai, Abu Dhabi’s Etihad and Sharjah-based Air Arabia. Sheikh Omar bin Saqr al-Qassimi, chairman of RAK Airways maintains that the airline is not a low-cost carrier despite the low ticket prices. Fares will start from AED10.
The airline has an existing contract with US aircraft manufacturer Boeing for four 737 aircraft and the option to buy two further planes. RAK Airways is currently discussing the terms of the contract. It is due to take delivery of the first two aircraft in 2011 and two more the following year.
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