Middle Eastern carrier Gulf Air is aiming to cut its annual losses to $300 million this year, demonstrating evidence that its restructuring strategy is producing results, and has agreed to lease two new Embraer 190s from Florida-based Jetscape.
At the Arab Air Carriers Organisation conference in Cairo, Gulf Air chief Samer Majali said that the airline would be "hopefully as close as possible to that [figure of $300 million]" by year end, adding: "We're halfway there, nine months down the line."
This year has, he says, allowed the Bahrain-based carrier to make the "rough cuts" - staffing levels, for example, have fallen by some 20% of 1,000 personnel over the timeframe - and that it needs to concentrate on refinements, but he admits: "Shaving costs over time becomes more difficult."
Gulf Air's restructuring has focused on overhauling its fleet, as well as a strategy of serving regional points and improving service quality. It is to bring in 12 new aircraft by the end of the year while phasing out 12 others. The carrier has cut capacity, but Majali attributes this to the use of smaller aircraft and says they are providing an increased number of flights. The average fleet age has fallen from 11 to eight years, he estimates.
Gulf Air hopes to halve losses again in 2011 and reach break-even, or better, in 2012.
Flightglobal's ACAS database records that the airline operates 34 aircraft including the two E-190s. Its narrowbody fleet is comprised of two Airbus A319s, 12 A320s and two A321s. It also flies 10 A330s and four A340s. The two E-190s have joined two E-170s already in Gulf Air's fleet. The carrier is also a Boeing 787-8 customer, with 24 aircraft on order.
DVB Bank supplied the senior debt financing to support the purchase of the E-190s by Jetscape.
Source: Flight International
