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|| UAE investor helps launch Djibouti national carrier

Djibouti-Air.pngA UAE private investor, Ebrahim Saeed Lootah have invested alongside the Djibouti government to launch Djibouti's new national carrier.

The airline made its inaugural flight to Dubai in March and will fly six-weekly flights from Djibouti to Dubai. It is planning to launch flights to Ethiopia, Somalia, Yemen and Kenya.

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More details follows from Gulf News

A UAE private investor and the Djibouti government will launch its new national carrier, Djibouti Air, by end of February, Gulf News has learned.

Operations will start with one aircraft and the first flight will be Djibouti to Dubai on February 22, company chief executive Shabab Attarzadeh told Gulf News in an exclusive interview.

Ebrahim Saeed Lootah, chairman of real estate and construction Lootah Group, is the board member and majority shareholder in the airline.

Initial service to Dubai will see six-weekly flights as the airline builds its network.

Within the first six months, the carrier also plans to launch flights to Ethiopia, Somalia, Yemen and Kenya.

Subsequently, it will expand into Europe and East Asia, while increasing frequencies to Middle Eastern countries.

Djibouti Air's launch strategy will be to undercut the market fares.

Two-class flights

"The airline will start with a Boeing 737-200, which will be followed with the second in 20 days," Attarzadeh said.

Launch aircraft will have a two-class configuration of Business and Economy, with eight and 112 seats respectively.

The second aircraft is a 737-300 with a total capacity of 145 seats, including eight in business class.

"The recipe is a hub-and-spoke model whereby we bring passengers to destinations within our network, from where they can travel to anywhere in the world," Attarzadeh said when asked about the driving force behind the expected success of the airline.

"By focusing on key markets like Kenya, Yemen and Somalia, the airline has a great chance of being highly successful — particularly in the absence of rivals between these countries," said Saj Ahmad in London, an airline analyst at FBE Aerospace.

Under served

Ahmad said by offering dual class seating, Djibouti Air could tap into a premium market that is widely viewed as under served.

"Not only does this allow them to better price their economy seats, but they'll be able to derive and drive revenue higher much more quickly in contrast to some low cost airlines that operate with a single class of cabin," Ahmad said.

Tapping into the highly populated neighbouring country of Ethiopia and capturing transiting passengers from Dubai, Attar-zadeh said the airline in the first month of operations expects to be able to service 1,500 passengers.

While Djibouti's local population is under a million, it provides a significant opportunity for Eur-opean flights as it hosts France's largest foreign military base.

Investment

Lootah's investment is not the first by the UAE in Djibouti as Dubai's conglomerate Dubai World has vested interest and assets there under its subsidiary DP World. The global ports operator manages Djibouti Ambouli International Airport which is also the military base for French and US forces.

"The airline is planned in such a way that we will be connecting the horn of Africa to the world," Attarzadeh said.

Ahmad said: "The biggest challenge, however, will remain getting favourable airport slot timings as well as access to newer generation aircraft ... Djibouti would do well to lease newer airplanes."
• 1,500 passengers to be served in airline's first month
• 145 seats on airline's second aircraft, a 737-300
• 120 seats on airline's first aircraft, in two classes


March 29, 2011  | Filed under UAE Investors

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