Etihad Airways and Air Arabia are starting a new low-cost carrier operating out of Abu Dhabi. The airlines say the intention is to meet “growing demand for budget travel from the United Arab Emirates’ capital.”
The new airline, Air Arabia Abu Dhabi, will fly regional routes from Abu Dhabi International, where Etihad is based. Air Arabia is based at Sharjah International Airport in the U.A.E.
The companies said more information about the new project will be made public soon.
This will be Etihad’s first investment in another airline since the failure of its “equity alliance” strategy, which once saw it hold stakes in as many as eight other carriers. Etihad owned 24 percent stake in Jet Airways, which went bankrupt earlier this year, and a 29 percent stake in airberlin, shut down in 2017.
Etihad is undergoing a five-year “transformation program” that aims to turn the company profitable. The project involved aircraft order cancellations, removing premium chauffeur services at international destinations, introducing buy-on-board choices, launching a new Economy Space seating option and outsourcing selected lounges to No1 Lounges.
Last year, the airline dropped unprofitable routes, including Tehran (IKA), Jaipur (JAI), Entebbe (EBB), Dallas Fort Worth (DFW), Ho Chi Minh City (SGN), Dhaka (DAC), Dar es Salaam (DAR), Edinburgh (EDI) and Perth (PER). The company is trying to become profitable by 2023.
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