x Abu Dhabi, UAEFriday 28 July 2017

Air Arabia to fly to China from next year

Air Arabia, the largest budget carrier in the Middle East and North Africa, will start flights to China next year, aided by the delivery of 10 new aircraft, its largest intake of planes since the airline launched a decade ago.

Air Arabia has been given permission to fly to several Chinese cities. Jeff Topping / The National
Air Arabia has been given permission to fly to several Chinese cities. Jeff Topping / The National

Air Arabia, the largest budget carrier in the Middle East and North Africa, will start flights to China next year.

The Sharjah-based carrier will next year take delivery of 10 new aircraft, the largest boost to its fleet since the airline launched a decade ago.

Adel Ali, the group chief executive, said Air Arabia had been given permission to fly to several Chinese cities.

He declined to name them but said they were consistent with the airline’s business model of serving secondary airports within five hours’ flying time from one of its three hubs of Sharjah, Alexandria in Egypt and Casablanca, Morocco. That would appear to limit Air Arabia’s possible China destinations to the vast nation’s west. Chengdu, near China’s centre, is about a six-hour trip.

Expanding into China made “common sense”, Mr Ali said. “There’s a big population, they’re travelling more and more, there’s a big Chinese population in this part of the world, in Africa. It’s a growing market and if we don’t take advantage of it then we’re not doing justice to our shareholders.”

Mr Ali was speaking at a media conference to mark the 10th anniversary this month of the airline’s launch. The first budget carrier in the region, Air Arabia has transported more than 37 million passengers during that time.

Next year the airline is targeting passenger growth of 10 to 12 per cent.

In addition to China, it is considering more flights to Central Asia. Ukraine, Russia, Kazakhstan and Armenia are among the countries it is targeting with extra routes. The airline is also weighing services to West Africa. It currently serves 85 destinations.

Aiding the expansion will be the arrival of 10 new Airbus A320 planes next year and the same number the following year.

“For the first time, the financing for those aircraft will come from GCC banks,”Mr Ali said. “GCC banks in the past did not come forward with financing but as the company gets stronger and gets more profit now they feel confident.”

Qatar National Bank was among a consortium of banks offering a syndicated loan, he said.

By 2016, the current 34-strong all-A320 fleet will have reached more than 50.

Mr Ali said the airline would likely for the first time next year consider ordering a different aircraft to the A320 but had yet to decide on what. Talks had been held with Airbus and rival plane makers Boeing and Bombardier, he said.

The carrier’s growth was being supported by the Sharjah authorities, with the building of a second runway at Sharjah International Airport, scheduled to be completed within the next eight to 12 months, he said.

Success in Dubai’s bid to host the World Expo 2020 would have a positive impact on the airline, he said.

One of the few black spots was the recent instability in Egypt. Demand from tourists had been temporarily dented, he said. The airline suspended flights to Damascus, Aleppo and Latakia in Syria after the unrest in that country descended into civil war.

Air Arabia said in August that its net profit for the first half of the year rose 17 per cent to Dh134 million, compared with the same period last year.

tarnold@thenational.ae