Page 275 - SHARJAH AIRPORT PR REPORT - OCTOBER 2023

10/27/23, 9:58 AM Air Arabia upbeat about growth amid shift to Abu Dhabi's new airport terminal

In 2018, Air Arabia celebrated its 15th anniversary by launching its new brand identity. Photo: Air Arabia

Since then, Air Arabia – the UAE's only listed carrier – has increased the size of its fleet to 71 aircraft and grown
its network to more than 190 destinations. It carried 13 million passengers in 2022.

“Air Arabia has been the trailblazer for low-cost carriers [LCCs] in the Gulf region. It has not only proved that
there is consumer demand for low-cost services but that it can be met profitably,” John Strickland, an aviation
consultant with JLS Consulting, told The National.

The airline is expected to continue being profitable as travellers look for better deals amid inflationary pressures
on consumer spending, according to analysts.
“When economic times are tough, people look for more economic pricing and this is offered by LCCs like Air
Arabia,” Mr Strickland said.

The airline's second-quarter profit rose to a record Dh459 million ($124.96 million), up from Dh160 million in the
same period last year, it said in August.

"As a first mover in the region, Air Arabia had played a pivotal role in shaping the low-cost aviation landscape,"
Linus Bauer, founder and managing director of Bauer Aviation Advisory, told The National.

“By offering competitive pricing, point-to-point services and minimal frills, it has set a precedent for other
carriers,” he said.

“Furthermore, Air Arabia’s focus on secondary airports has helped decongest major hubs and spread out the
economic benefits of aviation more evenly.”
The low-cost model recorded “substantial growth and acceptance” in the Middle East.

“The model has been particularly successful in catering to the price-sensitive segment of travellers, including
expatriates working in the Gulf countries and tourists looking for budget-friendly travel options,” Mr Bauer said.
“The growth of LCCs has also been facilitated by the strategic geographical location of the Middle East, serving
as a hub connecting East and West.”

Future of the low-cost carrier model

The future success of the LCC model will depend on several factors, including inflationary pressures and a
slowing global economy facing mounting uncertainties.

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