Gulf airline market is ‘normalising’, says IATA chief

Airlines undergoing restructuring and growth slowdown are experiencing what carriers in more mature markets have already undergone
Alexandre de Juniac, director general, Iata.
Alexandre de Juniac, director general, Iata.

Painful restructuring among airlines in the Gulf is a result of the region’s ‘normalisation’ following a period of massive growth in recent years.

That is according to Alexandre de Juniac, director general of the International Air Transport Association (IATA), who made the comments after the organisation published its forecast for the Middle East market, predicting $1 billion of losses in 2020.

IATA’s forecast warned that international trade wars and a continuing restructuring process among firms in the Middle East would contribute to a slowdown in capacity growth.

But the report, published in Geneva last week, added that the restructuring would eventually result in a better performance among carriers in the Middle East region.

“The gulf carriers are entering into normal waters after an incredible period of accelerated growth,” said Mr de Juniac at a media roundtable on Thursday.

“They are moving to something which is more classical. It means you have to deal with restructure, reshuffle your programme, your fleet – what the others are facing for years because the market is more mature. It’s more of a normalisation.”

IATA forecasts that the Middle East airline market can expect “some rebound” next year and the Middle East industry’s losses are forecast to reduce by half-a-billion dollars compared to 2019.

Mr de Juniac added that the ‘super-connector’ hub models adopted by major Middle East carriers is being challenged by ultra-long haul flights.

Qantas is planning a 20-hour flight between Sydney and London, cutting out the need for a Middle East stopover. But Mr de Juniac expressed some doubt over the ultra-long haul model.

He added: “We do not see the super-connector model disappear, it will continue.”

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