Wataniya Airways Suspends Flights

Independent Kuwaiti carrier Wataniya Airways suspended operations on March 16 after failing to overcome the financial issues that had forced it to restructure its operations and reduce its fleet last year. The airline was launched in summer 2008, inaugurating operations in January 2009 to destinations in the Persian Gulf, wider Middle East and Europe. It had attempted to differentiate itself from the country’s flag carrier Kuwait Airways and low-cost operator Jazeera Airways by offering a ‘luxury’ service using the exclusive Sheikh Saad General Aviation Terminal at Kuwait International Airport as its local hub. Its Airbus A320 fleet were also configured in a comfortable 122-seat configuration seating 26 passengers in Business First with a 44in (112cm) pitch and 96 in Premium Economy with a 34in (86cm) pitch - this compares with the 180-seat high-density layout adopted by many other airlines.

However, although passenger numbers were showing positive signs Wataniya has failed to secure the custom it required to make the business sustainable, with the global economic climate obviously impacting its development. Last December it grounded a third of its fleet parking up three A320s, reducing its network and cutting its staff. It had been hoped that this would be enough to safeguard the future of the carrier but recent political tensions in the Middle East and restrictive bilateral arrangements in the region have forced it to suspend operations.

“Given the current financial situation of the company and the lack of fair trade requirements in the local market, as well as the difficult political and security situation in the region, the board has decided to cease all Wataniya Airways operations," it said in a statement, adding that the company’s shareholders will now “determine the future of the company”, a matter that would be discussed at an emergency board meeting planned for the next couple of days.

Source: Flightbase (August 14-20, 2011) and IATA BSP (January 2010 – December 2010)

Over its two plus years of operation, Wataniya has served a total of 13 destinations from Kuwait International and the table above shows its performance on these routes during 2010 and the competition it faced. As can been seen, it has been fighting against domestic and overseas carriers on all but one of its routes, its six-times weekly link to Vienna. On some of these it has secured a good share of the market, particularly to Bahrain, Beirut and Sharm el Sheikh where it carried more passengers than Kuwait Airways in 2010. These routes show very different stories though. To Beirut and Sharm el Sheikh, Wataniya has secured high-yield traffic, however, the ‘luxury’ title was perhaps a false title on its flights to Bahrain where an average fare of $87-88 versus the $123-128 being offered by Gulf Air and $102-114 of Kuwait Airways would suggest that yields were not particularly strong and the airline had been selling cheap tickets to secure a strong customer base or simply for market share. Interestingly Jazeera Airways, the market leader which offers a low-cost service, had average fares of $81-87 on the route in 2010.

Wataniya Airways had developed a strong and loyal customer base and these travellers will now have to make use of the budget offerings of Jazeera Airways or national carrier Kuwait Airways when they travel in the future.