Gulf Air Finalizes Future Strategy Around Premium Product, Connectivity

RIO DE JANEIRO—Gulf Air is in the final stages of defining its future strategy, now that the airline has fully transitioned operations back to its Bahrain home base.

The strategy is to revolve around the keywords “signature,” “premium” and “connector,” Gulf Air CEO Martin Gauss told Aviation Week on the sidelines of the IATA annual general assembly in Rio de Janeiro June 6. While not revealing many of the details yet, Gauss said the airline plans to take advantage of the fastest minimum connecting time offered in the Middle East region—40 minutes.

Gauss, the former CEO of Air Baltic, has been with Gulf Air for seven months and has been tasked with establishing a new strategy that is to define the airline for the next ten years. He has been working with a consultancy to weigh elements of the strategy for several months and the process is to be completed in the next three weeks.

Choices for the future strategy had been narrowed down by Gauss and his management team before the consultancy had been brought in.

Mumtalakat, Bahrain’s sovereign wealth fund controlling Gulf Air, has also given Gauss “a clear target” of making Gulf Air profitable again. Gauss wants to make use of the “amazing brand from the past” and combine it with new elements such as digitalization and speed. He also says the connection between Gulf Air and Bahrain must become more visible to customers abroad.

Gulf Air was hit hard by the consequences of the Iran war, which led to its airspace being closed for 40 consecutive days. Initially, the airline took its aircraft out of Bahrain, but slowly built up an operation in Dammam, Saudi Arabia, a 115 km (72 mi.) drive across the causeway. “We established a full-blown airline operation in another country,” Gauss said. “The kingdom supported us in an unseen way. We built a major network out of Dammam.”

When the U.S. and Iran announced an initially temporary ceasefire, the airline slowly brought back services to Bahrain over a period of six weeks. As the last flight, the service to New York was moved back earlier this week.

Then, another drone attack on Bahrain was launched by Iran, but Gauss says the airport was only closed for 35 minutes and no flights were cancelled. Gulf Air is currently operating at a 82% load factor, according to Gauss.

Defining its future fleet is a key element of the strategy. The carrier has 15 more Boeing 787-9s on firm order in addition to the ten it already operates. The last Airbus A320/321ceos are to be phased out by the end of the year and will be replaced by A320neo family aircraft. Gulf Air is also looking at another narrowbody type, but Gauss refused to reveal further details. The airline is interested in operating A321LRs on lower demand routes that are too thin for the 787s. The A321XLR is not necessary as 90% of the potential markets can be covered by the LR, according to Gauss.

Three A321s will be transferred to Beond and will become part of the joint venture the two airlines are setting up. Beond will fly the aircraft in a premium configuration to some current Gulf Air destinations such as Malaga, Spain; Geneva and Nice, France. Zurich is also a possibility.