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Apart from Fly Jinnah, another airline will soon launch domestic services in Pakistan. It will be interesting to see what sort of pricing strategy these carriers will start on. Image Credit: Bloomberg

Dubai: Fly Jinnah, Air Arabia’s joint venture in Pakistan, is scheduled to take to the skies by end of this month, but it might be a while before the low-cost carrier goes international as it is bound by several local regulations.

“To get an international license under the same name, an airline needs to have 2-3 years of domestic experience and at least five aircraft,” said an official from Pakistan’s Civil Aviation Authority (CAA). “But this requirement may be waived off on the basis of the airline’s performance.”

If Fly Jinnah starts UAE flights, it would give another option to the more than 1 million strong Pakistani expat population in the Gulf country. In 2021, Pakistan was the number two destination from Dubai International (DXB) with 1.8 million passengers. The launch of a UAE route would also immediately pit it against rivals such as Airblue and Pakistan International Airlines (PIA).

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Fly Jinnah could even be allowed early entry into international services, but that for now remains more of a conjecture.

“It is a very busy route, and the capacity is definitely required, but I don’t think it would be possible to drop the prices even lower than some of the other carriers,” said a Dubai-based travel agent. “Some of the regular players are also increasing capacity.”

PIA and Airblue are charging passengers around Dh350 for flights from Dubai to Karachi – other airlines are seen charging more than Dh500 on the same route. Regardless of the hurdles ahead, Fly Jinnah seems to be well on track to begin domestic operations. “The airline is hiring staff and likely to get an air operator certificate (AOC) shortly,” said the CAA source.

The exact launch date for services is still not known, and Air Arabia did not respond to Gulf News’ query about the same.

Pricing plans

Going into a market full of low-cost operators, Fly Jinnah will need to quickly work towards differentiating itself. “They can focus on providing ancillary services such as internet services or in-flight sales of food and beverages,” said Fahad Masood, an aviation analyst. In a market where air travel is still not hugely popular, Fly Jinnah can operate flights connecting some of the country’s more ‘far-flung’ regions to its metropolitan hubs. “The airline can act as a feeder to the full-service network carriers as well,” said Masood.

In the post-pandemic era, airlines can no longer afford to operate flights at a loss and load factors of 80 per cent are a must, he added.

Market share

Fly Jinnah’s launch has not gone down well with everyone, least of all Pakistani airlines who are concerned about losing market share. In February, PIA CEO Arshad Malik, CEO of PIA said in a letter that allowing a new carrier to operate in Pakistan’s domestic market would be ‘counter-productive’ for an ‘ailing’ and ‘suppressed’ aviation sector.

Competition is already heating up in the space with another private airline - Q-Airways - set to start domestic operations in Pakistan. The airline will initially operate flights between Karachi, Lahore, and Islamabad.

Growth prospects

Air Arabia, which is also launching a new venture in Armenia, needs a much bigger fleet for its expansion plans. It currently has six Airbus A321neos and plans to lease more of the fuel-efficient aircraft before summer. “The market has come back much faster (than expected), and we need to grow the business in Abu Dhabi and the two new airlines,” said CEO Adel Ali. “Pakistan has a population of 200 million plus – we think there’s an opportunity.”

Pakistan could potentially be a large domestic market - but not anytime soon if experts are to be believed. Its current domestic volume of 4 million seats in 2019 meant just 0.02 seats per person, which is quite low.