MUSCAT: Entry of low-cost airline into Oman’s aviation market will not impede Oman Air’s ambitions, a top official from the airline has said.
“Oman Air has grown over the last year thanks to the competition. The new entrant will not stop us in our ambitions,” Paul Gregorowitsch, Oman Air’s chief executive officer (CEO), said in an exclusive email interview with the Times of Oman.
“We will continue on our journey to become the best and await the initiatives of the new entrants with confidence,” Oman Air’s CEO added.
On Wednesday, the Muscat National Development and Investment Company, Asas, was awarded an air services operator licence by the Public Authority for Civil Aviation to establish Oman’s first low-cost carrier.
The new venture is expected to fuel economic growth underpinned by strong air traffic demand, which is expected to grow by 40 per cent by 2019.
While responding to a question on what steps would Oman Air initiate to avoid a price war, Gregorowitsch said that as the initiative of the new entrant is supported by state investment funds, Oman Air will work together and share resources, such as the new simulator building, crew reporting building, emergency response facilities and integrated operational control centre.
“We see it as an opportunity to grow the market and to provide extra guests to our growing international network,” he said, adding that Oman Air is currently waiting to get more information about the low-cost airline’s routes and pricing point plans.
Commenting on why Oman Air didn’t launch a low-cost airline, Gregorowitsch said the airline launching a low-cost airline would be a diversion from its own brand position of being a full service airline and openly questioned if a lower cost base could be obtained, based on the existing labour laws in Oman and the lack of economic scale within a limited market.
During the announcement of the licence being awarded to the new low-cost airline, Khalid bin Hilal Al Yahmadi, CEO of Asas, had said that Asas’s aim would be to become one of the main development and investment arms for the government and pension funds in the country.
The low-cost airline’s CEO said that as the national budget airline, it would provide access to economical and efficient means of transport and further advance the aviation sector in the Sultanate of Oman.
“It will naturally complement our diverse projects that will soon come on stream, including our real estate and entertainment projects to maximise impact and generate sustainable returns. The constant growth of the aviation sector in the region is what drove us to explore the sector and create value for Oman,” he added.
According to latest data available, air passenger traffic through the Muscat International Airport, until the end of November 2015, reflected an increase of 17 per cent to 9,321,617 passengers, while it rose by 21 per cent at the Salalah Airport, compared with the same period in 2014.
Data showed an 18 per cent increase in the number of arrivals to 4,708,379, until November 2015, compared with 3,991,125 passengers for the same period in 2014. The number of departing passengers also rose by 16 per cent to 4,583,962, from 3,941,684 passengers a year ago.