The most important is SAMA stopping operation after sustaining one (1) billion riyals ($266 millions) in losses. These losses were sustained during the period of Oct 2009 and March 2010. A government relief package and a shareholders' cash injection fell short in monetary and time terms to bail out the airline. SAMA competes against NAS another LCC and Saudia the national carrier. Saudia has been subsidised for years by the government to keep domestic ticket prices low. SAMA senior management are hopeful to restart operation, how soon and under what shape remains to be seen.
Last June Bahrain Air announced that they will exit the Low Cost Carrier market and become a "value for money airline" more like a regular aka legacy airline. They reckon the LCC model does not work in the GCC. Bahrain Air will go for code shares, alliances and a frequent flier loyalty program.
Finally, RAK Airways announced its relaunch sometime in the September/October period of this year indicated also they will not launch as an LCC, but as a full fledged service airline.
The three airlines are not major players, but are feeling and reacting to the effects of a crowded and very competitive LCC market dominated by Air Arabia, Flydubai and Jazeera Airways.
How the market develops in the GCC remains to be seen. I very much doubt that we will see more airlines than the existing four (add NAS to the big three). This may mean that the next market is going to be in MENA, giving credibility to Air Arabia's strategy of starting LCCs in Morocco, Egypt and Jordan.
