Etihad Aviation Group, owner of the national airline of the UAE, and Air Arabia, the Middle East and North Africa’s first and largest low-cost carrier, today announced the signing of an agreement to launch ‘Air Arabia Abu Dhabi’, the capital’s first low-cost carrier.
Etihad and Air Arabia will establish an independent joint venture company that will operate as a low-cost passenger airline with its hub in Abu Dhabi International Airport. The new carrier will complement Etihad Airways’ services from Abu Dhabi and cater to the growing low-cost travel market segment in the region.
“Abu Dhabi is a thriving cultural hub with a clear economic vision built on sustainability and diversification. With the emirate’s diverse attractions and hospitality offerings, travel and tourism play a vital role in the economic growth of the capital and the UAE. By partnering with Air Arabia and launching Abu Dhabi’s first low-cost carrier, we are serving this long-term vision,” says Tony Douglas, group chief executive officer at Etihad Aviation Group.
Based in Abu Dhabi, the new company will adopt the low-cost business model. Its board of directors, consisting of members nominated by Etihad and Air Arabia, will steer the company’s independent strategy and business mandate.
The MENA low-cost air travel model was first introduced in the UAE in 2003 and has been rapidly growing since then. Today, the Middle East market enjoys the third highest gains in intra-regional low-cost carrier penetration rate. Low-cost carriers accounted for a 17% share of seat capacity to and from the Middle East in 2018, compared to only 8% in 2009.
