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Marketing Excellence succeed in making such remarkable progress in little over a decade? > > Air Arabia The company made a careful and plucky choice of aircraft from the outset-the Airbus A320 combined Air Arabia took-off in 2003 with only two leased Airbus comfort (boasting a 32-inch seat pitch) and efficiency A320 jets. The Sharjah-based airline began as a start- (162-passenger capacity). The A320s also benefitted up owned by the government and was the UAE's third from larger cabin space and a wider aisle, allowing for airline. Air Arabia has managed to establish its position in shorter boarding time and reduced in-flight congestion. the regional market of low cost carriers (LCC). Recently, A generous seat width (18 inches) granted the Airbus Air Arabia's low-cost rivals, flydubai and flynas, have ad- A320s best legroom offered by any of its competitors in opted what is referred to as hybrid model, which includes the LCC market. Finally, using a universal aircraft model a range of selected full-service offerings. This switch has lowered their training expenditure. managed to position Air Arabia as the only entirely low- Air Arabia currently owns 39 Airbus A320s, with a cost airline in the Middle East and North Africa region. Air current order of a further 44. Opting for brand-new planes Arabia CEO, Adel Abdullah Ali, pointed out in 2013 that has reduced fuel costs and environmental impact. Ali Al his company would always cater to the low-cost market. Naqbi, founding chairman of the Middle East Business Although one might have assumed that the region's Aviation Association, confirmed that aircraft demand in airline market was saturated, the CEO of Air Arabia in- the Middle East was not affected by the uncertainty and sisted that his company was planning to target around instability that the Arab Spring brought in the region be- 85 percent potential regional customers who cannot tween December 2010 and mid-2012. afford normal flying expenses. Starting with short-haul The company also prides itself on using pioneer- flights to neighboring countries in the peninsula, Air ing technologies to boost efficiency. In 2012, Air Arabia Arabia quickly gained price leadership in the Middle East smartly equipped its fleet with sharklet technology to region, becoming the first and largest LCC in the Middle reduce emissions by up to 4 percent on fuel-burn. East and North Africa. Sharklets are curved fin-like attachments to the wingtips Today, the company serves tens of destinations that facilitate higher take-off weight, significantly reducing across three continents, with hubs in Morocco, Egypt, overheads. In addition, Air Arabia foresaw the inevitable and the UAE, and has earned recognition as the premier fluctuations of fuel price and dealt with them ahead of LCC in the Middle East. Air Arabia has recently won two time by adopting a fuel hedging strategy in order to en- awards at the esteemed Aviation Business Awards 2014. sure that any increase in fuel prices would not automati- Air Arabia has utilized the cost cutting practices cally result in an increase in the price of its flight tickets. characteristic of other LCCs to maintain low costs, and In other words, Air Arabia has constantly maintained low thus deliver competitive fares to customers. How did they prices, thus preserving customer loyalty.Since its inception in 2003, Air Arabia has made exceptional offer granting low-cost solutions and high- considerable expansion exploiting the gap in the LCC quality travel experience to passengers. market and expanding its flights to more exotic des- In the first nine months of 2014, Air Arabia continued tinations. The airline now flies to nearly 100 destina- its upward progress and achieved a net profit of $135 tions, from its original base in the Middle East to North milion, up by 46 percent compared to the profit reported Africa, Central Asia, the Indian subcontinent, and several at the same period in 2013. The company's revenues European cities. showed an increase of 17 percent compared to the Its booking system has been expedited by a user- same period in the year before that. In the last decade, friendly online service, reducing turnaround time at air- 40 milion customers have chosen to fly with Air Arabia. ports, and keeping planes in the air. In 2012, the airline It was also the first publicly owned airline company in the had an average flying time per aircraft of 14 hours per day Arab world, floating for the first time on the Dubai Stock and an impressive seat load factor of 82 percent-one of Market in 2007. Air Arabia's top management has re- the highest figures in the industry. That year it upgraded cently declared that the company's fleet is expected to its online presence with a cutting-edge mobile Web site have 55 aircraft by 2015. that provided travel information on the move. The network expansion strategy, the persistent As confirmed by Adel Ali, prices in general represent focus on cost control by hedging fuel prices, and the a very important factor when it comes to booking a flight, use of world-leading fleet rates and high load while pre- which is why he made sure that Air Arabia prices are on serving passengers' comfort have been the key factors average 40 percent cheaper than the regular economy behind a small profitable airline company like Air Arabia's fare SUCCESS. Despite a thrifty "pay-less, fly-more" motto, the business has not lost its human touch. Unlike many other low-priced airlines, Air Arabia has consistently Questions kept its vision customer-oriented; its crew members are 1. Air Arabia has succeeded in profitably challenging big dedicated and view passengers' comfort as key to the established airlines companies in the Middle East and company's success. The online message refers to the North Africa. Why don't all other airlines apply the fact that Air Arabia is always ready to serve its custom- same business model as Air Arabia? ers wherever they are. This message emphasized the three main elements of the value triad espoused by the 2. What challenges does Air Arabia face? Do you think company: great flying experience, affordable price, and that the company will be able to maintain its leader- good customer service. In 2013, the company opened ship position in the LCC market in the Middle East and additional sales offices aiming to serve the increasing North Africa? What will happen if other airlines apply demand concentrated in the Middle Eastern and North the same business model as Air Arabia? African markets. Air Arabia's business model has consistently put low Sources: "Ar Arabia lags flydutal in the batle for Middle East LOC supremacy, but opportunities abound" Ailation Arelists CAPA, May 5, 2014; Al Arato Annual Report 2012, Alexander Dorval, fares, frequent flights, and safety at the top of its agenda; "Air Arabia wil not be a hybrid carrier," Gat' News, Novarriber 18, 2013, Alt Arabia PJSC, Fincorp, such efficacy has earned them high rankings and good November 6, 2012, Alr Arabia Annual Report 2073, Alan Dron, "Air Arabia reports 2013 net profit reputation among airline companies worldwide. Its recent up 2%, "Al Transport World, February 24, 2014; "Al Arabia posts record nine months net profit of AED 498 million, up 40%," Al Arabia, November 11, 2014; Brace Drum, "Alr Arabia accepts accolades include Skytrax's World Airline Award for best Its first Airbus A320 with Shakdets, " Word Airline News, January 31, 2013; "Al Arabia books LCC in MENA, and the Low-Cost Carrier of the year at $118-mon net profit in 2013," Bushess Standard, February 18, 2014; "Conditions of Cantage the Aviation Business Awards for three consecutive years. for Passengers and Baggage," Alr Arabia: "Double win for Air Arabia at Avtation Business Awards 2014," Alr Arabla, December 8, 2014; 'GCC Aviation Industry," Alpen Capital, March 3, 2014; The Air Arabia Group's CEO was named Airline CEO "Global Research Result Update Equity-Air Arabia Aviation Sactor, May 9, 2011; Muzaffar Finit, of the Year twice by Aviation Business. The company "UAE alrines dominate low-cout segment," Khalng' Times, November 13, 2011; "Alr Arabia vs was also rewarded the Airline Business Award at the Jareera Always, " Hopp Report "Air Arabia: Growth and turbulence In the desert, " The National Investor, August 10, 2008, "Attire Business Award Adel Al," The Attire Strategy Awards, 2014 Airline Strategy Awards 2014, in acknowledgment of its