Gulf Air’s new strategy

Middle Eastern airline Gulf Air has outlined its new strategy to “become commercially viable in 2010”.

November 23: Middle Eastern airline Gulf Air, the flag carrier of the Kingdom of Bahrain, outlined its new strategy to “become commercially viable in 2010” with route and aircraft fleet changes.

The airline plans to buy more narrow-body aircraft beyond the 15 ordered Airbus A320s and fewer wide-body aircraft as it expands its operations in the Middle East, Africa, Asia and Europe. However, it is suspending a number of long-haul routes that are no longer profitable, such as Shanghai, Hyderabad and Bangalore. It may sell five of its A340s and dispose of other aircraft that have become “surplus to requirements”.

Mr Talal Al Zain, Gulf Air Chairman and Chief Executive of Mumtalakat, the investment company that owns the airline, said, “We must re-align Gulf Air to deliver a product that our customers need and want. At the moment, Gulf Air currently relies on significant Government support, spending far more than it earns. This is clearly unsustainable.

He added: “We estimate this programme will save the Government of Bahrain up to $2.65 billion in direct support over the next five years. If we do not implement it, Gulf Air will continue to be an unacceptable burden on the national economy. No Government, business or individual can continue to spend more money than it earns over a continued period of time. Gulf Air is no exception.”

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