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Oman Air’s Bold Strategy Takes Off

Global Arab Network - Robert Bailey

Saturday, 14 November 2009 20:39

The Sultanate of Oman is investing hundreds of millions of dollars in its young national airline as part of an ambitious fleet and route expansion programme designed to position the airline as a top-end international carrier.

By the end of 2009, Oman Air which until recently was little more than an internal, and relatively small regional airline, will operate a fleet of 15 Boeing 737-800 single aisle airliners, two Airbus A330-300s and two A330-200s wide-body long range aircraft.

A further three A330-300s are due for delivery early next year. Over the next four years the airline expects that the first of six Boeing 787 “Dreamliner” twin-aisle long-range airliners will have been brought into service. These will consolidate the airline’s credentials as an inter-continental carrier.

Acquisition of several regional jets is also planned to augment services currently provided by ATR turboprops.

The Sultanate’s aviation expansion is a bold and ambitious step into what can be both a high reward and high risk business. In April this year Oman Air’s chairman Ahmed Bin Abdulnabi Macki, who is also the Sultanate’s Minister of National Economy, announced that the carrier’s capital had been raised six-fold to OR 300 million ($782 million).

According to the minister the step has been taken to increase the operational and technical potentials and capabilities of the company to enable it to provide world-class service to passengers.

Oman Air, he said, recognises that new routes, especially long haul routes, take a few years to mature before they start yielding positive results. “While the airline is expected to be self-sufficient and profitable only in the long term, it will continue to generate significant economic value to the nation in the interim.”

The airline is the leading component of a business group that includes ground handling operations at the Sultanate’s three airports – Seeb (Muscat), Salalah (Dhofar) and Khasab (Musandum) - as well as a catering division.

The group has also recently entered the hotels business with acquisition of the 180-room Golden Tulip Seeb Hotel A destination management division is also planned to act as an extension of Oman Air’s network able to provide ground services and leisure products in Oman. These units together with engineering and maintenance divisions are expected to help the business to reach break-even point within five years.
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The step by step approach is looking at long-term growth rather than gains in the near term, taking advantage of the increasing global popularity of the country as a tourist attraction, Usama Karim Al-Haremi, head of communications and media for Oman Air, told Global Arab Network.

The strategy already appears to paying off. Oman’s flag carrier has recorded a 23 per cent increase in capacity in 2009 compared to the previous year and a further 10-15 per cent is projected for 2010.

“All paths are leading to tourism development,” says Al-Haremi with Oman being promoted as a unique destination not for mass tourism but for selective niche markets to attract medium to high end travellers.”

This requires the Sultanate building global connections to key markets. For the country’s tourism potential to be developed direct air connections are increasingly needed.

Oman Air’s international route network now includes all major cities in the GCC, 10 destinations in India, Chittagong in Bangladesh, as well as Karachi, Cairo, Beirut, Amman, London and Bangkok. Frankfurt, Munich, Paris, Colombo, the Maldives and Sri Lanka have been added this autumn.

The latter two routes have been added to help promote two-sector holidays with vacationers having a stop-off in Oman before moving on to Male and Sri Lanka

Next year, additional European destinations such as Prague as well as cities in Italy and Scandinavia are being considered. New routes to Malaysia and Pakistan are planned as well to while a return to East Africa. Hong Kong and Shanghai are also thought to be on the agenda. All new routes are primarily intended to be operated on a non-stop basis.

Global Arab Network

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