2017 is likely to be a much more challenging year for the Gulf's airline industry, particularly in light of the recent electronics ban enforced by the US and UK, according to an industry expert.
This view comes from John Strickland, director, JLS Consulting, who is an authority on the business models of regional, global, legacy and low cost carriers.
Strickland will moderate discussions at Arabian Travel Market 2017 later this month in Dubai when aviation-related discussions will be dominated by the US-led ban on electronic devices and the repercussions for regional airlines.
Overall the policy affects about 50 flights a day to the US, meaning the ban could impact over 15,000 passengers daily. Emirates currently operates 18 daily flights to 12 US airports, Etihad runs 45 flights a week between Abu Dhabi and six US cities and Qatar Airways flies directly from Doha to 10 US cities.
Strickland said: “2017 presents a much more challenging picture for the airline industry in the Middle East, particularly in light of the recent electronics ban enforced by the US and UK.”
The ban includes tablets, laptops, eReaders and anything that measures larger than 16cm x 9.3cm .
Airlines affected by the US ban include Royal Jordanian Airlines, Egypt Air, Turkish Airlines, Saudi Arabian Airlines, Kuwait Airways, Royal Air Maroc, Qatar Airways, Emirates and Etihad Airways.
The UK ban includes: British Airways, EasyJet, Jet2.com, Monarch, Thomas Cook, Thomson, Turkish Airlines, Pegasus Airways, Atlas-Global Airlines, Middle East Airlines, Egyptair, Royal Jordanian, Tunis Air and Saudia.
Despite these setbacks, the Middle East’s major carriers and airports are forecast to see an additional 258 million passengers a year by 2035, according to the International Air Transport Association (IATA).
IATA also said that despite sluggish global economic growth, low oil prices, ‘Trumponomics’ and Brexit, the UAE will lead Middle East passenger growth in 2017 with an annual increase of more than 6.3 percent.
Strickland, who was instrumental in KLM’s decision to establish the low-cost operator Buzz and also worked for British Caledonian, British Airways and KLMuk, will also lead delegates through a number of sessions, taking place over the course of the four-day show, addressing a wide range of issues facing the aviation industry today and in the future.
“Although oil prices are edging upwards, within the region, Emirates reported an AED786 million ($214 million) profit for the six months to September 30 2016, down 75 percent on the same period the previous year, and revenues also declined slightly to $11.4bn (down from $11.5bn). While Etihad has indicated a likely change in its investment strategy, particularly into other airlines,” added Strickland.
With a number of aviation mega-projects underway across the GCC and wider Middle East, airports are expanding slightly ahead of the curve in demand, with capacity in 2016 increasing by 13.9 percent and a forecast for 2017 of 10.1 percent.For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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