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BA focuses on alliances for future growth in the region

Friday, Jul 15, 2011

Gulf News

Dubai As British Airways completes 80 years of operations in the Middle East next year, the UK flagship carrier is looking to optimise growth avenues in the region with a chunk of future growth to come from partnerships and alliances.

The first step was taken earlier this year with the merger of British Airways and Spanish airline Iberia, which put both carriers under one holding company, IAG (International Airlines Group).

“For one month we have been operating codeshare with Iberia on all our Middle East routes. And we also have a codeshare agreement from the region to the US with American Airlines, thanks to the joint business agreement between the two parties,” said Paolo De Renzis, British Airways Area Commercial Manager for the Middle East.

“Going forward, definitely, one of the focuses for us will be partnerships and alliances — to grow together with our partners,” he told Gulf News in an interview.

Main market

Asked if any more partnerships were expected this year, De Renzis said the carrier is likely to look for “more opportunities” during the course of the year.

“This would allow travellers in the Middle East more access to destinations in Spain, South America and North America, for instance,” he said.

Representing roughly 30 per cent of BA’s Middle East revenues, Saudi Arabia is one of carrier’s biggest markets in the region.

“We started flying to Saudi Arabia only in 2009. Now we fly five times a week each on Riyadh-Heathrow and Jeddah-Heathrow routes,” said De Renzid, adding this would be increased to six per week in winter.

The UAE, on the other hand, accounts for more than 25 per cent of BA’s revenues in the region, he said.

Asked how much the Middle East accounts for BA’s global revenues, De Renzis, without divulging the region’s contribution, said: “The Middle East is definitely one of the most important regions for us. We saw a steady growth in the Middle East even in 2009 [during the economic downturn] when we didn’t grow in terms of revenue overall… but that’s also because we started flying to the Saudi Arabian cities of Jeddah and Riyadh.”

Reinforcing a long-standing presence in the Middle East, BA operates 59 weekly flights between the Middle East and London Heathrow, with continued investments being made into the market.

“The Middle East is one of the key markets for BA’s network. We have invested and we continue to invest in this region,” said De Renzis.

Capacity increase

He added that while the British carrier has no plans to increase the number of routes in the region at present, it will keep on increasing capacity.

“During challenging economic times in 2009 when we kept capacity under control overall, this was the only region where BA grew capacity,” he said.

BA, meanwhile, is expected to announce plans over the next few days regarding the upgrading of planes on probably one of its Middle Eastern routes, De Renzis said, without divulging further details.

While almost every airline operating in the region took a considerable hit in revenue owing to the geo-political unrest, De Renzis says the unrest had little impact on BA’s operations.

“Bahrain is actually the only market where we suffered a bit, and our flights in the kingdom operated under a revised schedule only for a short period of time.

“But now we are back to normal,” he said, adding that the airline is overall pleased with its performance in summer so far.

BA is currently operating over 80 per cent load factor on its Middle East routes due to a busy summer period.

“Now, it’s more or less business as usual,” he said.

30%

Saudi contribution to BA’s regional revenues

25%

UAE contribution to BA’s regional revenues

59

weekly BA flights from Mideast to London

By Shweta Jain?Senior Reporter

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