Qatar Airways CEO Akbar Al Baker believes that low-cost carriers (LCCs) would struggle in the Gulf region in the future. He shared this statement amid the nature of several airlines in the area consolidating in the current conditions.
Unique times
During a Fireside Chat hosted by Aviation Week, the executive spoke candidly about the state of the aviation industry amid the global health crisis. Furthermore, he offered some insight into the future of the market.
Al Baker doesn’t think that demand will return to 2019 levels for the next three to five years. He feels it will take a miracle to reach those levels in the current climate. Moreover, the businessman feels that if there is a second wave, and more airlines are having to consolidate, there could be trouble, especially when it comes to Qatar’s neighbors.
“I don’t think there will be too many airlines left if there is a second spike or any consolidation. How can you have consolidation with somebody who is your adversary all around you? And this, what happened to us in 2017, will never be forgotten. This memory will never be erased from our minds,” he said in the discussion hosted by Aviation Week.
“We’re seeing that there is talk of consolidation between Emirates and flydubai, but there should have never been a flydubai. And the same is now happening with our other neighbor, Abu Dhabi. Etihad has completely shrunk, and now they are looking at giving JVs to foreign carriers like Wizz Air.”
New movements
At the beginning of this month, Wizz Air completed its first flight to Abu Dhabi. The Hungarian low-cost airline is also planning to open a new subsidiary in UAE capital. Ultimately, it is looking to have 100 aircraft based in the city by the end of 2035.
However, Al Baker feels that low-cost outfits don’t have any future in the gulf region. Along with the view that passengers in the region are used to high quality, he said that LCCs are more suited to certain big catchment areas. These firms are used to having a sizeable domestic network, whereas the Gulf doesn’t have that.
Additionally, Al Baker said that every low-cost long-haul airline fails. He mentioned Joon, Scoot, Germanwings, and AirAsia X as some examples.
Change of scene
Altogether, there has been a massive shift in the aviation industry over the last few months, and this transition will continue for several more years. Therefore, there will undoubtedly be some changes in the way people travel going forward. However, according to Al Baker, certain passenger habits will remain the same.
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