Arab airline alliance plan
Arab airlines are talking about forming an alliance like One World or Star Alliance, reported Bloomberg. The alliance called Arabesk would include: Saudia, Egypt Air, Gulf Air, Middle East Airlines, Oman Air and Royal Jordanian. It would help to cut costs by rationalising route structures.
Arab airline pact set for take-off
Bahrain Tribune - 09/10/2005
Arabesk, an alliance of six of the Arab world's leading airlines, is expected to take off soon.
The airlines - Egypt Air, Gulf Air, Middle East Airlines, Oman Air, Royal Jordanian Airlines and Saudi Arabian Airlines - are now discussing the alliance with Sabre Airline Solutions and the Arab Air Carriers Organisation (AACO), sources said yesterday.
The new entity will be on the lines of One World, Star Alliance and Sky Team which together have 33 airlines under their wings.
"This will be the first airline alliance that coordinates the schedules of six close competitors," said the sources, adding that the goal of creating this pan-Arab alliance is to provide financial benefits that the carriers are not able to achieve individually.
"The real issue is that close competitors are not able to cooperate effectively because they end up wooing the same passengers," they said. "The upcoming alliance, when it takes final shape, will challenge this perception by ensuring that the cooperation occurs on schedules, while allowing free and open competition on pricing between the members for the pool of passengers."
They said this, it was hoped, would stimulate the growth of traffic in the region and improve the market share of each of the members.
Among other benefits, the sources said, the alliance will provide better separation of services, reduce duplication of capacity, linking networks and destinations, generating market demand through improved customer connectivity and maximise capacity through route sharing and rationalisation.
According to estimates, the combined network of the six carriers totals over 5,000 departures each week reaching from North America to the Far East, giving vast potential to the alliance.
Chief Executive of World Travel Service, Hisham Al Baradie, said: "If it goes through, it would greatly strengthen all those involved."
He said, however, that there needed to be a clear vision, a definite programme and their efforts should be synergised in such a way that all the players benefit, in addition to the regional players being strengthened."
He said these airlines should also cooperate and compete directly with larger carriers/alliances with a combined network, while still competing with each other for passengers based on a competitive pricing policy.
