Kuwait: Kuwaiti discount carrier Jazeera Airways has delayed a planned expansion into long-haul flights to focus on extending its existing network to serve the Indian subcontinent.
Jazeera, which has previously been limited to operations within the Middle East, will start operating to Hyderabad in India and Lahore in Pakistan this month before adding Delhi, Mumbai and Chennai later in the fourth quarter, chairman Marwan Boodai said in an interview.
Boodai had said in February that Jazeera aimed to commence inter-continental services this year once it had secured an alliance with a major airline based in Europe or Asia. While that plan remains “alive," it won’t happen in 2017 after the carrier reset its priorities in light of surging short-haul demand.
“The opportunity for the Indian subcontinent was so overwhelming we had to redirect our resources to that," the chairman said Monday in Kuwait before unveiling a new livery and interior makeover reflecting a re-branding launched in July. The flights will target the more than 900,000 Indian nationals residing in Kuwait, he said.
Jazeera plans to acquire two more aircraft by the end of the year to expand its fleet of seven Airbus SE A320-series single-aisle planes, Boodai said, adding that he regards the jetliner market as overpriced and that for the moment all purchases will be confined to such spot deals, with no larger orders.
Expanding into long-haul flights will require Jazeera Air to further build up its regional network, and will also have to wait until the completion of a new terminal to be used by the carrier at Kuwait International Airport, scheduled for the first quarter of 2018, he said.
The company hasn’t yet settled on an airline partner, though it has identified more than one candidate, Boodai said. Long-haul flights could generate $300 million in sales within two years and $500 million within five years, according to estimates in February.
An 18 percent increase in second-quarter net income was “not a one off" and third-quarter numbers will show the company is headed in the “right direction," aided by the addition of new destinations and the revival of some old ones, he said. That’s after earnings fell 30% to 10.8 million dinars ($36 million) last year amid a slump in fares. Bloomberg