UAE: Airfares have peaked, will stay high until summer – News

Flydubai chief says new plane may be ordered later this year

Ghaith Al Ghaith, CEO of flydubai. — Photo by Rahul Gajjar

Ghaith Al Ghaith, chief executive of flydubai, said airfares have peaked and are likely to remain at that level for the next few months.

Airfares surged last year, driven by huge post-pandemic demand and high fuel prices following the Russia-Ukraine crisis.

Emirates has been increasing seat capacity and has announced several new routes.

“Flight prices are still very strong because of the big increase in fuel prices. They are at their peak because it’s a supply and demand issue. I believe it (airfares) will stay until the summer,” Ghaith said at the opening of the Dubai World Trade Center on Monday. said in an interview on the first day of the four-day Arab Tourism Market 2023.

The CEO of Flydubai said the 14% increase in efficiency of the Boeing 737 MAX aircraft operated by the airline has helped a lot in providing better pricing to customers.

He added that the demand for business class is growing, therefore, it has introduced a new business class. Al Ghaith said it would also help it better synergize with Dubai’s flag carrier, Emirates.

The airline has added 12 destinations this year, with the potential to add two more, and is bringing back about nine summer destinations.

“We’re postponing certain things because there’s a lot more demand on our existing route network. So we’ll probably announce one or two more routes in the winter.”

Al Ghaith believes demand will remain strong for the rest of the year.

In the interview, he revealed that the Dubai-based airline will see a 50% increase in passenger traffic in the first quarter of 2023 compared to the same period last year. “We expect this surge to continue, and as a result, we will increase capacity by about 20% over the summer to a record 5 million seats, largely due to high demand for inbound traffic. I have never seen anything like last year And such a good business this year.”

Point-to-point business at Dubai Airport is growing faster than transit business, reflecting the growing influx of businesses setting up base in Dubai, he added.

The airline has already received seven aircraft this year and will take delivery of 17 more.

In terms of supply chain challenges, he said last year was bad, but this year is manageable and next year looks to be better.

US planemaker Boeing is facing production-quality challenges related to two of several brackets in the fuselage of the 737 MAX.

“We believe this is a technical issue and Boeing is reviewing all inventory, deliveries and production. One of our planes is also affected. There may be more, but they are still being checked,” Gass said.

He said the airline was trying to close some deals to buy new planes at the Dubai Airshow, which runs from Nov. 13 to 17.

“Airplanes are a seller’s market. So it is uncertain when flydubai will place an order. I really want to do something before the end of the year.”

Responding to a question about aircraft demand, he said a large number of aircraft would be ordered.

“We’re very close to deciding that we need to buy more planes. The more orders other airlines place, the more challenging plane availability and pricing becomes. So you have to know when to sell business.”

He expects flydubai to have 90 aircraft by the end of this year and more than 100 by the end of 2024.

He said India could offer huge potential if the government agreed to open up its aviation industry and develop an open skies policy.

“I think somewhere, somehow business to India has been damaged by not having that kind of aggression (which is required). As more and more airlines come on board and buy new planes, hopefully this will Policy makers will be encouraged to open up the aviation industry.”

For example, to highlight the potential, if Delhi opens up the aviation industry, flydubai alone can fly to 40 destinations in India, he said. “India is a treasure trove of tourism.”

waheedabbas@khaleejtimes.com