Wednesday, March 23, 2011

Royal Jordanian - MENA's Trend Setter

In a recent interview on Aviation Business the CEO of Royal Jordanian (one of the few publicly listed airlines in the region) stated that the way forward for the airline is a strategic alliance and joint venture similar to the BA/Iberia, Air France/KLM  or Lufthansa/Swiss, where the airlines strengthen each other while each maintains its identity, The time frame is between a year and a decade. He also emphasized that any partner can not be a government owned airline.

Royal Jordanian is a trend setter in the region. The airline was;
1. The first government owned airline to privatize and publicly list, and
2. The first airline to join an airline alliance One World

Since then Gulf Air, Saudia and Kuwait Airways are slated for privatization and Egypt Air joined the Star Alliance with Saudia and MEA slated to join Star Alliance and Sky Team respectively in 2012.

Going back to airline consolidation, Gulf Air responded positively to the idea that BA/Iberia is looking for a middle east partner and so did Royal Jordanian. But then both CEOs come from the same background (Royal Jordanian).

Now, to indulge in some educated speculation;
1. Gulf Air is working towards privatization in the near future.
2. Royal Jordanian and Gulf Air fleets are very similar
3. Both carriers can strengthen each other with Royal Jordanian having a strong presence in Europe and
    North America and Gulf Air in India, Africa and the Far East.
4. Both carriers have a strong presence in MENA and the GCC.

Almost meeting the criteria mentioned earlier by Royal Jordanian's CEO

The region is catching up with the industry in terms of alliances and airline failures so why not consolidation.

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