Al Maktoum Airport will be home to new airline

Dubai: The new budget airline announced by Dubai Government will base its operations at the Al Maktoum International Airport, a top official told Gulf News on Wednesday.

It will be run by a new airline company owned by the Dubai Government and will not be part of the Emirates Group.

"We expect to start the airline within a year's time from the Jebel Ali airport," Gaith Al Gaith, the airline's new chief executive, said in an exclusive interview.

"I do not have a firm date of the commercial launch at the moment."

Al Gaith, who is also Emirates airline's executive vice-president for commercial operations worldwide, is responsible for the commercial success of Emirates - the most profitable Arab carrier. His department does the groundwork before starting services on a new route. All Emirates routes have been very successful so far - giving the shareholders rich dividends.

"It will be a new company owned by the Dubai Government, separate from the Emirates Group. However, Emirates will help to set up the airline.

"Its operation will be based in the low-cost terminal of the Al Maktoum International Airport in Jebel Ali," said Al Gaith.

Too early

"It's too early for us to talk about the funding requirements. However, you could be sure that whatever capital requirements we have, the Government of Dubai is there to back us up. So money is not an issue," he said.

On the airline's fare structure, Al Gaith said it's too early for him to offer any indication.

"You'll come to know in due course. However, it will obviously be cheaper than most conventional airlines serving the region," he said.

The new airline will start with single-aisle aircraft to shuttle between regional destinations. It is, however, unclear if the new airline will have exclusive deals with Dubai Aero-space Enterprise (DAE) whose aircraft leasing arm DAE Capital has already ordered more than 100 aircraft to be deployed in the market in the coming months.

DAE is a Dh55 billion investment vehicle launched by the Dubai Government in 2006, aimed at strengthening Dubai's position as a regional aviation hub. DAE eventually will play a strong role in helping the new budget airline take off.

Asked about the airline's fleet plans Al Gaith said, "We are looking at either A320/A321s or B737s to start operations.

"We will soon start talking to aircraft suppliers for deployment of the aircraft. For leasing, all options are open and we will be talking to potential partners."

Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority and Chairman and Chief Executive of Emirates Airline and Group, is also chairman of the new airline and chairman of DAE.

Preliminary work

Al Gaith said preliminary work in setting up the office will be done from his current office at the Emirates headquarters.

"I'm still with the Emirates Group. However, my focus will gradually shift to setting up of the new airline," he said.

Asked if the airline will seek external funding or raise cash through a possible initial public offering, he said, "We have no say in that. We have only the mandate to meet the government's expectations."

Carrier to have own brand and identity

The Government of Dubai's announcement to set up a new airline will result in the formation of a new company that will operate a low-cost airline model with its own brand and identity.

Although the new airline will be supported initially by Emirates during the set-up period, it will not be part of the Emirates Group.

Initially the airline will operate regionally within the GCC and surrounding countries.

The airline is expected to deploy single-aisle aircraft serving destinations reachable within four hours from Dubai.

Shaikh Ahmad Bin Saeed Al Maktoum, chairman and chief executive of Emirates Airline and Group and chairman of the new airline, said: "Emirates will assist in the formation of the airline up to its first flight. I am confident that with Gaith as the CEO, this new airline will be very successful. The Emirates Group will assist him in forming the new company and will continue to give all support as required up to its inauguration."