While the world’s biggest airlines are feeling the sharp pinch of rising fuel prices, it is the low cost carriers that appear to be ruling the skies today.
According to aviation industry experts, the big industry carriers are now making room for low cost airlines that are taking off with one flight of success after another, posting profits, ordering new aircraft and entering new markets.
The emergence of the low cost airline industry as a star industry in its own right, both globally and on the regional level in the Middle East and North Africa region, is the subject of the �Low Cost Airlines World MENA’ conference, taking place 3-5 November in Al Ain, UAE.
The event, expected to assemble around 200 industry players, is organised by Terrapinn, which has staged some of the world’s most highly acclaimed aviation events, including the region’s own Aviation Outlook Summit which took place last February in Abu Dhabi. The "Low Cost Airlines World MENA" is sponsored by Abu Dhabi Airport and Al Ain Airport.
"It is becoming a well-known fact that the Middle East has eased its way into a leading position in the world aviation market, but what is even more interesting is the role that the low cost airlines have played and will continue to play in the future growth of the regional industry," says Symon Rubens, Managing Director, Terrapinn Middle East.
"Away from the glitz and glamour of massive airplane orders and designer aircrafts, the low cost aviation industry has shown solid performance and expansion and has been working under the radar to fill in the gaps left by the large downsizing carriers and bring a lot of benefit to the industry as a whole." With fuel prices at an all time high, some of the largest airlines in the world are shedding jobs, cutting routes and grounding aircraft. There have been 24 airline bankruptcies this year with the aviation industry facing losses of $6 billion worldwide.
The MENA region has appeared immune to this ongoing economic turbulence in the world’s aviation market. In 2007, Middle East carriers posted 18.8% growth in passenger numbers - more than double the global average growth rate of 7.5%. $54 billion are to be invested in airport expansion within the Middle East, while the aircraft leasing market in the Middle East is expected to increase to $1bn by 2010 from its current $800m value.
"The regional industry’s growth appears even more pronounced, when set against the general atmosphere of pessimism and caution that has afflicted the global industry, explains Symon Rubens. "Regional Low Cost carriers have played a key role in increasing air traffic, creating their own markets, as well as migrating passengers from other companies." The Middle East has a growing number of local Low Cost Airlines, operating with great efficiency and success. The large expatriate population, impressive airport expansion, ideal geographic position, large pools of liquidity and regional liberalisation will provide the opportunity for many new market entrants over the coming years.
"Low cost carriers are expanding and connecting the dots in their route network through strategic partnerships, coping with the challenges of low cost operations," Rubens continues. "Regional carriers are looking to expand as quickly as they can in the hope of taking up the slack left by downsizing rivals and positioning the region as a global aviation crossroads." The conference will throw light on the key topics facing the airline industry, showcase integral market intelligence for entering the market or growing market share, and discuss successful strategies and explore new opportunities.
It will bring together the heads of several well-known low cost airlines and key figures from the aviation industry in the region, with speakers including H.E. Khalifa Al Mazrouei, Chairman and Managing Director of Abu Dhabi Airports Company, and senior representatives from Dubai Airports, Air Arabia, Jazeera Airways, Sama, Virgin Blue, British Airways, Istithmar World Aviation amongst others.
