Sunday, February 7, 2010

Gulf Air...Rocky Path Ahead

Mumtalakat, the investment company of the Kingdom of Bahrain transferred back the ownership of Gulf Air to the government. Mr. Talal Al Zain, the Chief executive of Mumtalakat told Reuters over the phone "Given it's in the airline industry, it is not a high-return investment but more of a strategic investment," and "You will never have more than single-digit returns in this industry." Read the full story here . He also said that Mumtalakat has fulfilled its role in the design of Gulf Air's new strategy that focuses on regional routes.

Agreed it is a strategic investment but if done properly an airline can yield double digit returns.

So, what happened all of sudden to change Mumtalakat's mind. Of course Gulf air is a strategic investment for the Kingdom of Bahrain, but then Mumtalakat is part of the government.

My guess is, Gulf Air is at the point whereas decisions about staffing levels have to be made and implemented. The Gulf Air employee union has always resisted management attempts at reducing staff or transferring staff.

My take on this is, there will be a show down very soon and Mumtalakat does not want to be distracted by labor strife and issues. It would rather have the government take the hard decision of who to support, a newly appointed CEO or bow to popular pressure.

I am sure the CEO will talk extensively with the union representatives to come to an acceptable solution, a hard job for sure and the many people before him have failed miserably.

Interesting times ahead for Gulf Air and the region, I am sure a few airlines will be watching how this will unfold.

No comments:

Post a Comment


1 Goal 2010 2012 2013 9/11 AA Abu Dhabi ADAC Air Arabia Air Canada Air India Airberlin aircraft airlines airports ambitions American Airlines Amman aviation AVOD AWST B707-300C B767 B777 B787 BA Bahrain Bahrain Air BangaloreAviation Boeing branding British Airways Business Aviation Cabin Crew Canada change chapter 11 CO Commercials communication community compliance contingency continuity Continuous Improvement cost effective creativity Culture curricula Customer Service Delta Detroit Metro DFW Doha DTW Dubai Dubai Air Show DWC efficiency emergency Emergency Response Emirates employees environment ET409 Etihad ETS EU FA FAA family Flight Attendants flight(s) Flightglobal flydubai GACA Galaxy Tablet GAMCO GCC globalisation GOL Greece Green Gulf Air Hala Hamburg happy health home Hopenhagen Human Resources IFE India Iran Iraq Iraqi Airways Jaffa Jazeera Airways Jet Airways Jordan Just Culture Kuwait Airways LA LCC leadership low cost maintenance management manpower MEA MEBAA MENA Michigan motivation MRO MROAM Oneworld Palestine passengers passion people Philadelphia planet earth Privatization professional QAIA Qantas Qatar Qatar Airways Quality Quick Service Restaurant Radio Repair Stations Risk road roots ROTANAJET Royal Jordanian Safety Sanctions. Sao Jose Dos campos SAT Saudi Arabia Saudi Arabian Airlines Security Sharjah Airport SimliFlying Simplicity SKYTEAM SMS social media Southern California Southwest Airlines Star Alliance Sudan Airways support target teachers Technology terrorism tolerance Toulouse tourism traffic Training transition travel TSA Turkey Twitter UA UAE UBM US Airways VIA Rail Violin Vision volcanic ash Wataniya Airways
Top Blogs
Powered By Invesp