Saturday, March 5, 2011

MEA - Comfortable and Complacent

Middle East Airlines (MEA) on 28 February signed an agreement with SKYTEAM to join the alliance in 2012. During that ceremony Minister of Public Works and Transport Mr. Ghazi Aridi announced and vowed that MEA will retain its monopoly and all exclusive rights will be renewed in 2012 (click for full story).

MEA must be thrilled. The airline has become maybe too comfortable and definitely complacent. It has forgotten  that with government support and exclusive rights come responsibilities towards the travelling public in Lebanon.

In the recent events in Egypt regional airlines like Etihad and Royal Jordanian operated extra flights to evacuate their nationals and in the case of Etihad expatriates residing in the UAE. More recently when Libya erupted Lebanese nationals were stranded in Tripoli while Royal Jordanian evacuated 2000 people over a period of a week. This is not risk aversion, airlines that operated to Tripoli did their risk assessment and obtained their insurers consent to operate, MEA seems not to be bothered.

On 25 October 2010, the MEA Chairman complained about the unregulated open skies policy of the country  (click here for details). He actually joined the criticism leveled at the Emirates, Etihad and Qatar Airways by European and North American legacy airlines.

And now the preservation of its monopoly, sorry exclusivity on routes which makes it unattractive to local competitors. The removal of Royal Jordanian's exclusivity did not affect the airlines that started in the last 36 months in a big way. This will provide a lopsided competitive scene whereas foreign airlines have easier access to the Lebanese market than local companies in the making.

The elimination of competition and the disregard of the Lebanese public interest in case of crisis does not bode well for MEA. There are alternatives provided by 55 other airlines. And political uncertainty and fuel prices may not be the only reasons for the loss of revenue and profits.

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