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AIRLINES Air Cairo


that we built it up over the years, so we will keep it.” While the self-professed low-fare


SHIFTING STRATEGIES


Air Cairo is not the only Egyptian carrier shifting its business model in response to the myriad challenges bearing down on the North African nation. Local rival Nesma Airlines has


already completed its volte-face from charter operator into a fully scheduled carrier. “It wasn’t a strategic plan to be all-scheduled,” MD Ashraf Lamloum admits. “[It was] due to the impact of the circumstances that we faced.” The carrier launched in 2010 with a similar business model to Air Cairo, targeting Europeans who visit the Red Sea and Nile River resorts on package holidays. But as the fallout from the Arab Spring intensified, it began basing aircraft in Cairo for scheduled flights to Saudi Arabia – tapping a resilient country pair that has limited exposure to tourism. It now serves nine Saudi cities from Egypt’s capital, as well as flying domestically within the kingdom. Lamloum says that Nesma could resume charter


operations as soon as this summer, but only if the prices offered by travel agents are commercially attractive. “Our ideal [setup]… is to be mixed charter [and] scheduled,” he insists. “Charter operations secure foreign currency; scheduled operations give you better yields and higher frequencies.” Another local operator with a strong presence in


Saudi Arabia is Nile Air, the largest private carrier in Egypt. It presently deploys five Airbus A320s and one Airbus A321 from Cairo and Alexandria, versus Nesma’s Egyptian fleet of three A320s and one Airbus A319. CEO Ahmed Aly favours the country pair for its


diversity, explaining: “In Saudi Arabia, we’ve got the religious Hajj and Umrah traffic; we’ve got the visiting friends and relatives traffic, in terms of the large Egyptian community living out there; we’ve got the strong inbound tourism from the Gulf region; we’ve got the corporate agreements with the oil companies and with universities in Saudi Arabia and Egypt; and we’ve also got the government traffic.” His nine-point Saudi network is complemented by other regional services to Al Ain, Baghdad, Basra, Istanbul, Kuwait and Port Sudan. And while there are no plans to scale up traditional charter flights, Nile Air is slowly broadening its leisure horizons. Last year, the airline launched domestic routes from Cairo to Hurghada and Sharm el Sheikh, as well as connecting the latter resort with Amman. Voicing confidence about a near-term pickup in Egyptian tourism, Aly adds: “We certainly believe that in the foreseeable future Nile Air will have a presence in the European market.”


22 ISSUE 1 ROUTES NEWS 2017 routesonline.com


airline is now committed to expansion, the outlook for parent company EgyptAir remains unclear. The flag-carrier lost $1.5 billion in the five years following the Arab Spring. Its 2016 financial results have not been disclosed, but it is hard to imagine any rebound given the fallout from Metrojet Flight 9268 and the three other security incidents. Plans to grow the group’s fleet


from about 75 to 120 aircraft by 2025 have repeatedly been shelved, with management ordering just nine planes last year versus a projected figure of 70. CEO Safwat Mosallam insists that eight of those units – all Boeing 737-800s – will be delivered on schedule this year, although civil aviation minister Sherif Fathy has spoken publicly about deferrals. Even if the new Boeings do arrive on


time, they will almost certainly be used as replacement – rather than expansion – units. EgyptAir disposed of three A320s last year and is planning to phase out more Airbuses, as well as selling four stored 737-500s. Notwithstanding the resumption of Japanese charter flights in 2016, its network remains heavily contracted against pre-crisis levels. With so many problems blighting


Egyptian tourism in recent years, some pundits believe the market may have finally bottomed out. Colliers International, a commercial real estate firm, says that hotel revenues are now climbing across the country. Germany’s decision to lift travel restrictions against Sharm El Sheikh has also buoyed hopes of an upturn.


Nonetheless, Britain and Russia are


among the countries still opposing non-stop flights for fear of another airborne atrocity. As long as the shadow of terrorism looms over Egypt, none of its airlines can take recovery for granted. £


Air Cairo began as a charter specialist in 1997 but has diversified into the low-cost market


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