The story of Sharjah-based budget airline Air Arabia has been something of a miracle. Launched in 2003, the airline broke even in its first year and has been rapidly expanding ever since. In fact the airline has made a profit every year since its inception, which is remarkable to say the least. With a network of 46 destinations, the airline is growing steadily. Recently, the carrier launched Air Arabia Egypt, yet another feather in the cap of Adel Ali, Member of the Board and Group CEO of Air Arabia.
Talking about Air Arabia’s success, Ali said one of the reasons the airline has been growing so rapidly is because it was not named after a city or country, which gave it an opportunity to expand. He added that a large part of the revenue comes from the subcontinent. Around 35 per cent of the four million Air Arabia passengers come from the subcontinent, a significant percentage. This is probably because budget travel was a fairly new concept in the region. Given the dearth of local airlines in Pakistan, most people think that traveling means spending half your savings on tickets, explained Ali. Add to that the fact that airlines hardly ever advertised their fares. “Their focus was on brand and the way it was presented. Pricing wasn't a part of it. That's the change we've brought to the industry. We've brought frequencies. You don't have to wait to travel, or travel in the middle of the night,” he added.
Air Arabia has made a difference in the way people from Pakistan travel, said Ali. Previously, only the wealthy could afford to travel. Now, everyone can. People from low-income groups can also travel, they don’t need to be very wealthy to do so. Around 50 percent of the carrier’s customers are leisure passengers while 30 percent travel on business (particularly freelance workers and those who have to travel for a day to make purchases/attend meetings). The remaining 20 percent, are those belonging to the labor market that travel back home during holidays and other occasions. Ali states that in the Middle East and Africa markets, a lot of students use Air Arabia for weekend travel if they want to go home. “The idea is to change air travel from being an exclusive commodity for the elite to a service for the masses. Kind of like public transportation,” he explained.
Besides keeping it simple and affordable, Air Arabia has also been able to maintain costs by making sure almost all of its flights are no longer than five hours, said Ali. “This saves fuel costs tremendously,” he added. Recently, a branch of the airline called Air Arabia Maroc was formed in view of budget traveling to European destinations. Air Arabia Maroc, said Ali, serves several European destinations, now providing affordable travel in that part of the world as well. When asked of the future, Ali said that he hopes to increase Air Arabia’s fleet size to 50 by 2015. Whether or not he manages to do so remains to be seen.