Etihad and Air Arabia will establish an independent joint venture company that will operate as a low-cost passenger airline with its hub in Abu Dhabi International Airport.
Thursday 17, October 2019 BY MUZORIWA KUDAKWASHE
UAE’s Etihad Aviation Group has partnered with Sharjah-based Air Arabia to launch ‘Air Arabia Abu Dhabi’, the capital’s first low-cost carrier.
Tony Douglas, Etihad’s Group Chief Executive Officer, said, “We look forward to the launch of the new airline in due course.”
Air Arabia, UAE’s only listed carrier, posted a 75 per cent jump in Q2 profit to AED 210 million ($57.2 million) in August 2019.
“The partnership with Air Arabia supports our transformation programme and will offer our guests a new option for low-cost travel to and from Abu Dhabi, supplementing our own services,” said Douglas.
Based in Abu Dhabi, the new airliner will adopt the low-cost business model and its board of directors, consisting of members nominated by Etihad and Air Arabia, will steer the company’s independent strategy and business mandate.
Adel Al Ali, Group Chief Executive Officer, Air Arabia, said that the partnership with Etihad to establish Air Arabia Abu Dhabi will further serve the growing low-cost travel segment locally and regionally while capitalising on the expertise that Air Arabia and Etihad will be providing.
The UAE has four local carriers, Emirates, Etihad as well as flydubai and Air Arabia) two of which (flydubai and Air Arabia) are low-cost and experts have long said that the market is overcrowded, considering the UAE’s population of under 10 million people.
Additionally, the UAE’s travel and tourism sector contribute to over 13.3 per cent of the GDP.