SalamAir Takes First A321neo As It Seeks To Broaden Horizons
SalamAir has taken delivery of its first Airbus A321neo which expands the Oman-based LCC’s range from its home bases at Muscat and Salalah.
The 212-seat aircraft’s ability to fly for roughly eight hours means SalamAir can reach destinations further into Europe, Africa and the Far East.
“The employment of this aircraft to our fleet with its additional range and extra 32 seats to our existing [six] A320neo will support the growth plans of our airline’s network,” SalamAir CEO Mohamed Ahmed said.
SalamAir previously stated ambitions to grow to around 20 aircraft by 2024—but that was before the COVID-19 crisis reshaped the air transport market.
“Being in a country like Oman, which is the poorest among the GCC countries with lower willingness to pay from customers, SalamAir—with its low-cost model—grabbed the opportunity when it was established in 2016,” said Linus Benjamin Bauer, the MD and founder of Dubai-based consultancy Bauer Aviation Advisory. SalamAir commenced commercial operations in 2017.
Over the last decade, Oman has been experiencing the most significant expansion in its population in at least fifty years. “It had one of the fastest-growing populations across the globe with a growth rate of more than 9% per year,” Bauer told Aviation Daily, noting that this had been driven by the large influx of migrant workers who have arrived in the country to build infrastructure.
VFR travel demand has been soaring in tandem with the oil-rich state’s rising headcount, which should give SalamAir’s growth plans a boost in the post-pandemic era.
“However, given SalamAir’s fleet plan, they must reduce their unit cost (CASK) and increase revenues (RASK) to ensure they can enjoy financial sustainability,” Bauer said. Despite having a homogenous A320 family fleet and the cost advantages that brings, the LCC’s maintenance fees are one of its key cost drivers, according to Bauer. “The newly delivered A321neo provides SalamAir the opportunity to reduce its operating costs if the maintenance-related processes are optimized,” Bauer said.
From a strategic point of view, the airline’s existing codeshare partnership with flag-carrier Oman Air should be extended to explore potential synergies and shared services.
“A stronger partnership between SalamAir and Oman Air would enhance Oman’s position on the regional aviation map. In addition to that, it would support SalamAir’s expansion plan,” Bauer said.
“If I look at the macro-environment of the Omani carriers, structural reforms and economic policy readjustments will be required for a sustainable post-coronavirus future for the Omani carriers including SalamAir,” Bauer added.