x Abu Dhabi, UAEFriday 28 July 2017

FlyYeti to suspend operations in Nepal

The decision to close the new carrier started by Air Arabia was prompted by political uncertainty in Nepal.

FlyYeti.com was Air Arabia's first commercial launch outside of its Sharjah hub.
FlyYeti.com was Air Arabia's first commercial launch outside of its Sharjah hub.

ABU DHABI // FlyYeti.com, a Nepalese budget airline that is partly owned by Air Arabia, based in Sharjah, will temporarily suspend operations following political uncertainty in the Himalayan nation, six months after it began servicing the country. FlyYeti.com began with great fanfare in January via a joint venture between Air Arabia and Nepal's Yeti Airlines, but a message posted on its website said the airline will suspend the flights on July 16. "The current uncertainty, combined with difficult operating conditions in Nepal and a presently opaque regulatory environment has led the management to decide that it is in the best interest of the company and passengers to temporarily suspend operations," the statement said. The Nepal airline had operated regular weekly flights to Abu Dhabi, Doha and Kuala Lumpur, and said its seat load factor, or proportion of seats filled, was an unusually high 80 per cent. National elections in April gave the country's former rebel Maoist Party a majority of seats in parliament, but it has not been able to form a coalition government with other parties. The uncertainty comes as the country is suffering from food shortages and other domestic troubles. Last week Girija Prasad Koirala, the prime minister of Nepal, said he would step down, clearing a barrier for the coalition effort. However, the resignation has created a technical barrier for FlyYeti.com, which is due to renew the leases on its aircraft soon. The lack of a Government head means the budget carrier might have been unsuccessful in receiving the required government guarantees.

A spokesman for Air Arabia said the aircraft used by FlyYeti.com, consisting of two Airbus A320 narrow-bodied aeroplanes, might be redeployed to Sharjah for Air Arabia. Suspending flights due to political disorder is not new for Middle East airlines. Most carriers serving Lebanon were forced to abandon their services to Beirut during the military conflict in 2006 and again more recently due to internal strife, but quickly resumed service once the situation became more stable. "In terms of the effect on Air Arabia, I don't see anything substantial," said Kareem Murad, a vice president at Shuaa Capital specialising on the transport industry. "They already have all the agreements in place for the Kathmandu hub, and have already arranged the aircraft, which they can instead utilise at different airports." FlyYeti.com was Air Arabia's first commercial launch outside of its Sharjah hub. Air Arabia is planning to open a unit in Rabat in Morocco later this year, and is also planning a hub in the Levant region after raising Dh2.57 billion (US$735 million) in an initial public offering last year. As The National was going to press Jet Airways, India's top private carrier, announced it had shelved plans for its discount unit JetLite to fly on international routes because of the tough market environment, a senior official said. Soaring oil prices have prompted Indian carriers to raise fares and trim routes in a bid to cushion falling margins. "In the current scenario, we cannot operate new routes, as they take time to develop and yield returns," Rajeev Gupta, the chief executive of JetLite said. "New routes take at least 90 days to develop, and we cannot afford that now when ATF prices are so high. So we've put our international plans on hold until prices come down."

@email:igale@thenational.ae