MENA Airline Report 2005

A review of a busy year for airlines in the Middle East & North Africa region.

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By  Neil Denslow Published  December 1, 2005

|~|report_m.jpg|~||~|Afriqiyah Airways Afriqiyah Airways pushed forward with its international expansion plans this year, as it benefited from the end of Libya’s political isolation. The airline launched a number of new routes over the year, including Kano, the industrial heart of Nigeria, Bangui in the Central African Republic and Douala, Cameroon. Flights were also started to Amsterdam, Afriqiyah’s fourth European destination after Paris, London Gatwick and Brussels. A number of other routes are also under consideration for launching in the near future, including Johannesburg, Manchester, Dubai and Dakar. To support this growth, the airline has overhauled its IT systems by rolling out SabreSonic. The passenger management solution from Sabre Airline Solutions will help the carrier enhance its service levels, including introducing e-ticketing. The airline’s fleet remained unchanged during the year, but the carrier is evaluating A330-200s for its long-haul routes and A320s for its regional operations. Air Algérie Air Algérie’s fleet renewal process moved into full swing this year, with the airline receiving aircraft from both Airbus and Boeing. From Seattle, the airline received its eighth 737-800 in July, raising its total fleet of 737s to 13. The aircraft was also fitted with blended winglets, as were two other of the airline’s 737-800s. Two more –800s are due to arrive in August 2006. From Toulouse, meanwhile, five A330s flew to Algiers during the year, completing a deal signed in 2003. To make room for these new aeroplanes, Air Algérie retired a number of aircraft from its fleet, including an A330-300, a 727-200, a 737-400, a 767-200ER and five of its 13 737-200s. Another 27 aeroplanes are understood to be up for sale, including the airline’s fleet of seven Fokker 27-400s. The fleet modernisation programme also showed that investors are confident in the airline’s future, as it has been able to raise funds in the market. In May, for instance, it signed a US $167 million loan from banks and institutional investors. Such support suggests that the government should be able to find a buyer when it moves ahead with its part-privatisation plans. Next year meanwhile, may see the launch of scheduled services to Montreal, the USA and, possibly, China as well. Air Arabia Sharjah’s low cost carrier achieved a number of landmarks during 2005, which was only its second year of operation. The most notable was the fact that the airline was able to report a breakeven first year, beating its business plan. It reported revenues of $59 million, which was generated from 5398 flights and 546,687 passengers. The 1 million passenger barrier was also crossed in June, the airline’s 18th month of operation. Air Arabia’s growth, however, continues to be stymied by the lack of open skies in the region, which limits both its frequencies and routes. The airline did manage an important breakthrough in 2005, when it gained access to the Indian market. A daily service to Mumbai began in March, which later went double-daily. Nagpur was added to the timetable in October as well. The airline is now seeking permission to serve five other secondary destinations in India, but when this will be granted is unclear. Other new routes launched over the year included Astana, Almaty, Amman, Aqaba, Kabul, Luxor and Sharm El Sheik. The airline now serves 23 destinations in total, and it plans to add more, especially in central Asia and the Mediterranean. These routes are presently operated by five A320s, the last of which arrived in January. However the airlines plans to have a fleet of 12 to 15 aircraft within the next five years. Air Cairo The Egyptian charter carrier ordered six CFM-powered A318s alongside the Paris air show, as it planned a major expansion of its services. Presently, the carrier flies two A321s that are leased from its majority owner, EgyptAir, on services to Europe and the Middle East. The operations will expand significantly once the carrier begins to receive its A318s from the third quarter of next year. Al Khayala National Air Services, one of the largest private jet operators in the region, launched the Middle East’s first privately owned carrier in August, when Al Khayala took to the skies. However, reflecting Saudi Arabia’s closed skies policies, the all-business class airline only has one route at present, Jeddah-Riyadh. This service is flown 20 times a week, but the majority of Al Khayala’s flights are operated on a charter basis. Once Saudi Arabia liberalises its market, NAS plans to add more destinations to Al Khayala’s timetable. To support this goal, and the expansion of its charter service, NAS ordered five A318 Elites, with five options, at Dubai 2005. NAS also confirmed at the airshow that it plans to launch a domestic low cost carrier by the summer of 2006. Atlas Blue Atlas Blue has continued to grow its operations in line with the Moroccan government’s wider investment in tourism. The Marrakech-based carrier, which is 100% owned by Royal Air Maroc, had a strong year in both its low cost and charter business. The carrier flew services across Europe for a range of travel companies, including First Choice. The airline had said that it would purchase new aircraft over the course of the year, but these plans are yet to come to fruition. Its long-term goal though is to operate a fleet of 24 aircraft by 2013. The business plan also predicts profits of $1 million on revenues of $123 million this year, rising to $10 million profits and a turnover of $480 million by 2012. Buraq Air Libya’s sole private carrier agreed an order for three 737-800s in March, as it prepares to launch a number of international services next year. Buraq Air presently only flies domestically and to Aleppo and Istanbul, but it is aiming to launch seven or eight new destinations in the Middle East and Europe next year. However, these plans are reliant upon Libya successfully negotiating bilaterals.||**|||~||~||~|EgyptAir EgyptAir continued its fleet renewal process this year by ordering 12 new 737-800s in a deal valued at around US $850 million. The order was a surprise, as the carrier had previously announced that it was looking to reduce the number of aircraft types it operated in its predominately Airbus fleet. The carrier’s change in policy was widely ascribed to political factors, as the order coincided with Egypt’s closely watched presidential election. During the year, the Egyptian flag carrier also received three more of the seven A330-240s that it ordered in 2003. Two more are still to arrive. The airline also developed its cargo operations in line with a plan announced in 2004. In July, the carrier received its first converted A300-600F; another is due in June 2006. With the expanded cargo fleet, the airline planned to launch flights to Paris, Rome and Amsterdam. In terms of passenger services, the airline was affected by the Sharm El Sheik bombing in August, which impacted on the number of tourists visiting Egypt. More positively, the highlight of EgyptAir’s year was the resumption of flights to Beijing after a two year hiatus. The airline also expanded its network through cooperation with other carriers, notably including Austrian, Olympic and Singapore Airlines. EgyptAir is also taking part in AACO’s Arabesk project, which has already led to cooperation with Gulf Air, as well as the Arabian Air Pass. Emirates The Dubai-based carrier made its traditional showstopping order at its home airshow, when it ordered 42 Boeing 777s with 20 options. The mega-deal capped a year of headlines for the Emirates. In May, the airline reported its 2004 results, which showed yet more growth. Revenues across the group, which also includes Dnata and MMI, were up 34.9% on the year before to hit $5.2 billion. This produced a group profit of $707.9 million, a 49% rise on 2003’s figures. The airline arm made net profits of $637 million, up from $427 million in 2003, while carrying 12.5 million passengers. Despite rocketing fuel prices, this trend continued into 2005, with Emirates reporting group profits of $251 million for the first six months of the financial year 2005-06, up 7% on the same period in 2004-05. Emirates’s fleet also continued to grow, with around one new aircraft a month arriving in Dubai. The airline crossed the 80 aircraft mark in September when it received its fifth 777-300ER out of a total order for 30. It also received four A340-500s over the year, completing its order of 10. EK’s A380 deliveries, however, have been postponed in line with the wider delays in the superjumbo project. Emirates SkyCargo also ordered three A310 freighters early in the year, as the carrier looked for more capacity and greater flexibility for its cargo operations. Financing for these aircraft came from a wide range of sources, including China and Japan, as Emirates pushed into new markets for funds. The carrier also issued an Islamic Sukuk, a first for an airline, which received subscriptions of $824 million against an initial target of $550 million. This helped finance a number of major projects that will support the future growth of the carrier, including a new headquarters, an engine test facility and a huge MRO facility at Dubai Airport, which boasts nine A380-sized hangars. The new aircraft helped Emirates expand and reinforce its network. New routes launched over the year included Seoul, the Seychelles and Alexandria. Frequencies to another 20 cities were also increased, including the launch of a second daily flight to New York and a fifth to Heathrow. EK’s next destinations over the coming months will include Abidjan, Hamburg and Beijing.||**|||~||~||~|Etihad Airways 2005 has mainly been a year of preparation and consolidation for Etihad. The carrier has launched a number of new routes, including Brussels-Toronto and Johannesburg, but the main bulk will begin next year once it starts to receive its huge fleet of Airbus and Boeing aircraft. The first 777s were due to arrive this year, but the deliveries were delayed by the Boeing strike. These aircraft will now arrive from January, along with the first Airbus aeroplanes. In total, the two-year-old carrier now flies to 20 destinations, with Frankfurt and Cairo also having joined EY’s network this year. The airline is aiming to serve 70 destinations by 2010, and it will add a host of cities next year, including Jakarta, Manchester, Manila, Paris and, possibly, Shanghai. Its fleet of three freighters, meanwhile, are already flying to 10 scheduled destinations, including Almaty, Amman, Frankfurt, Khartoum and Mumbai. These flights should help the carrier achieve its 2005 goal of carrying a total of 100,000 tonnes of cargo, five times what it carried in 2004, its first year of operations. To prepare for its rapid passenger fleet rollout, Etihad has spent much of 2005 laying the foundations for its future plans. Robert Strodel, for instance, was promoted from head of cargo to CEO over the summer to lead the carrier’s development going forward. The airline also implemented a number of back end tools, such as Lufthansa Systems’ network planning and MIDT analysis applications. Large scale construction work also took place at Abu Dhabi airport to support the growth of Etihad’s fleet. Two new terminals were built over the summer, for instance, and plans were also drawn up for a second runway and a new 60 million passenger capacity midfield terminal. In terms of its fleet, Etihad only received two passenger aircraft this year, a pair of leased A330-200s, which arrived in February. The carrier did, however, select Trent 900s for the four A380s it has on order, as well as ordering two A330/340 full flight simulators from CAE. Etihad also announced that it would offer passengers live TV and internet in every seat using a combination of IFE systems from Connexion by Boeing and Thales. Gulf Air For Gulf Air, 2005 will be remembered as the year that it lost the second of its four original owners. Abu Dhabi’s decision to pull out of the carrier, three years after Qatar, was not unexpected given the amount that the emirate has invested in rival carrier Etihad Airways, but the timing did catch out observers. The two remaining owners, Bahrain and Oman, quickly pledged their long term commitment to Gulf Air, and James Hogan, the carrier’s president & CEO, also said that it was ‘business as usual.’ However, the withdrawal obviously raised questions about the carrier’s future, and it is now going through a major strategy review as it switches from three hubs to two. Abu Dhabi’s pullout, which will be completed in the spring of 2006, took the gloss off what was otherwise a successful year for the airline. Most notably, the carrier was able to report that 2004/05 was its first profitable year since 1997, as Project Falcon, Hogan’s three-year turnaround plan for the airline, began to bear fruit. However, the $4 million net profit hid an operating loss, which was mainly caused by the year’s record fuel prices. The airline was only able to report a profitable year because of two major deals signed in early 2005 that gave it an exceptional windfall. It firstly sold off its distribution arm to Sabre Travel Networks, as part of a new joint venture between the two companies. Then, in April, it signed a huge $138 million MRO deal with Lufthansa Technik, which included the sale and leaseback of the airline’s existing rotable components inventory. The airline also signed a number of codeshare and partnership deals with other carriers over the year, as it looked to extend its network. Gulf Air is one of the leading players in AACO’s Arabesk codeshare project, which has already led to deals with MEA, EgyptAir and Saudia. The carrier also agreed a frequent flyer programme partnership with Jet Airways, as well as signing an MoU with US cargo carrier, Evergreen. This deal demonstrated the airline’s greater focus on freight, which also included the establishment of a separate cargo division and talk about operating freighters. In terms of passenger services, the carrier launched a new service to Dublin and also returned to Johannesburg after an eight year hiatus. The airline also issued its first e-ticket in November, as well as upgrading its first and business class cabins earlier in the year.||**|||~||~||~|Iran Air It was another difficult year for Iran Air, and for the country’s aviation sector in general, as US sanctions continued to impede Iranian airlines. The national flag carrier has long grounded five Boeing planes because of its inability to get spare parts, and in November, five Airbus planes joined this list as well. Washington had agreed to ease sanctions in March to allow in some civilian aircraft parts to support an EU package of incentives aimed at persuading Iran to abandon its nuclear programme. However, the EU talks subsequently broke down before Iran was able to receive any parts. Cut off from Western aircraft, the country has been investing more heavily in CIS aeroplanes and domestic production. A local manufacturer, HESA, for instance, is aiming to produce one Antonov An-140 a month within three years, having finally overcome the funding issues that had long delayed the project. These planes will be supplied to a number of local carriers including Safiran Air and Aseman Airlines. In April, the country also re-opened its new main international airport in Tehran. The much-delayed Imam Khomeini International Airport had originally opened almost exactly a year before. However, it was closed down on its first day of operations by the military amidst security concerns about the foreign contractors that were running the facility. It re-opened under the control of a domestic consortium, including Iran Air, but the start of operations were marred by Britain and Canada raising safety concerns about the runway. Iraqi Airways Commercial aviation in Iraq took further steps towards normality during 2005, led by the increasing expansion of Iraqi Airways’s operations. The national carrier opened a number of new routes during the year, despite insurance costs causing sky-high ticket prices. The new routes included Beirut, Cairo, Dubai, Istanbul and Tehran. The twice-weekly service to Iran was suspended after just over a week, however. To support its network expansion, the Iraqi flag carrier also expanded its fleet by taking on three 727-200 Advances and a 767-200 over the course of the year. All of the planes were sourced in the US and leased to Iraqi Airways by Jordanian-based Teebah Airlines. Hamilton Aerospace, which has worked closely with Teebah Airlines on the fleet expansion, said in November that another 767 would join the fleet soon. It stated that Iraqi Airways was also planning to have four 737s and four 767s operational by the end of next year. Aside from Iraqi Airways, a number of other carriers also launched services into and out of Iraq. For instance, Kurdistan Airlines, which is owned by Iraq’s autonomous Kurdish region, made its maiden flight from Erbil to Dubai in August. Tigris Airways made its first flight the same month, heading to Cairo from Baghdad. While Ishtar Airlines, which was founded by former Iraqi Airways pilots, began flights in March. International carriers are still rare in Iraq, but air links are improving. SyrianAir recently launched a thrice-weekly service to Baghdad and privately-owned Phoenix Air began flights between Dubai and Basra in September. Royal Jordanian, which has long served Baghdad up to twice-a-day, also announced plans in November for flights to Basra and Erbil. Jazeera Airways The Middle East’s second low cost carrier, Jazeera Airways, began operations in late October. The privately owned Kuwaiti airline’s launch network included Amman, Beirut, Damascus Dubai and Bahrain. Alexandria and Luxor were added in December after the arrival of a second A320. As part of the carrier’s original launch order, two more A320s will be delivered next year, which should enable the launch of flights into the Indian subcontinent. At the Dubai airshow, the carrier also signed another deal for a further six A320s. Jordan Aviation Traditionally a charter carrier, with a particular focus on UN flights, Jordan Aviation won permission to launch scheduled service from Aqaba beginning in June. Its first destination was Dubai. A service to Bahrain was later added in October. In 2006, the carrier will add more routes, and it also said that it will order a pair of either 737s or A320s, in line with its strategic plan of operating 23 aircraft in five years’ time. Kuwait Airways The Kuwaiti flag carrier achieved an important step towards improving its operations and fleets in June, when the national parliament approved both its 2005 budget and its accounts for the last seven years. The airline has long been saddled with huge debts that were caused by the need to replace much of its fleet following Iraq’s 1991 invasion of the country. However, the government was unable to clear these debts because of opposition in parliament. The June vote paved the way for government to step in and sort out the state-owned carrier’s finances; however, the parliament shelved plans to privatise the carrier during the same special session. The airline has begun to turn itself around though, as it posted an operating profit of $10.3 million for the six months to September. This has been achieved through cost-cutting, continuing a project that has been on-going for some years. In particular, the airline carried on reducing staff numbers through a hiring freeze for non-technical positions and early retirement. It also sort to boost its network through cooperation with other airlines. This included a codeshare on Air China’s Beijing-Kuwait service, and participation in AACO’s Arabesk and Arabian Air Pass projects. ||**|||~||~||~|Middle East airlines The assassination of former prime minister Rafik Hariri in February and the subsequent withdrawal of Syrian forces rocked the whole of Lebanon, including its national carrier. However, the revitalised MEA was able to ride through the subsequent downturn in the country’s economy and tourism due to the reforms put in place by CEO, Mohamed El-Hout, over the last few years. These have seen the carrier renew its fleet and cut both staff number and routes, while turning into a successful business. In 2004, the airline achieved record profits of $50 million. 2005 is unlikely to match this figure because of the instability seen in Lebanon this year, but the airline is confident of being comfortably in the black. This should also help the government’s attempts to privatise the carrier, beginning with a sell-off of around 10% of the company late next year. MEA’s profitable results have also been achieved despite the fact that it operates in the most competitive aviation market in the region, because of Lebanon’s open skies polices. To protect its market share, the carrier is therefore investing in improving its customer service levels. New projects over the year included a new business lounge in Beirut airport and IT upgrades, such as a company-wide CRM system and plans to install self-service check-in kiosks. It has also cut its operating costs by agreeing to outsource its A321 engine maintenance and overhaul to Lufthansa Technik. The Lebanese flag carrier also expanded its network through codeshare deals, including ties with Gulf Air and Qatar Airways. It is also taking part in the Arabian Air Pass and Arabesk. Plans to launch a regional airline in partnership with SyrianAir are also still ongoing, but moving slowly. Oman Air Oman Air’s main focus in 2005 was on improving its back office operations, particularly its use of IT. The carrier launched a major project with Sabre Airline Solutions at the beginning of the year to implement a range of new systems, including the introduction of e-ticketing, an internet booking engine and a frequent flyer programme, as well as enhancements to its planning and revenue management functions. The project reached a notable milestone in October, when the airline issued its first e-ticket. The carrier also implemented other cost-saving measures throughout the year, including retrofitting winglets on its three 737-800s, and signing a five year time & material contract with Snecma Services covering the CFM56-7B engines on its fleet of Boeing 737s. The sixth and final one of these arrived in Muscat in late March. A few months’ later, in June, the airline’s CEO, Abdulrahman bin Harith Al Busaidy, announced that he was leaving the company after nearly five years of service. He was replaced by Ziad Al-Haremi, formerly the airline’s commercial manager. Palestinian Airlines The Israeli withdrawal from the Gaza Strip may soon mean a return to scheduled services for Palestinian Airlines from its base at Gaza International Airport. The runway at the seven year old airport was destroyed in 2002, and since then the Palestinian carrier has been largely confined to Umrah charter services from Egypt’s Al Arish airport. It may return to Gaza soon, however, and the Palestinian Authority is already talking about privatising both the airline and the airport. Qatar Airways Qatar Airways made one of the biggest splashes at this year’s Paris airshow by announcing plans for two knockout orders. The Qatari flag carrier revealed at Le Bourget that it was planning to buy 60 A350s and 20 777s, including freighters, -200LRs and –300ERs. The deals were also significant for the two airframe manufacturers. The A350 order sealed the launch of the new aircraft for Airbus, while the 777 deal was the first time that Qatar had ordered Boeing aeroplanes. Also at Paris, the carrier announced a $100 million deal with Lufthansa Technik, covering the maintenance and overhaul of the V2500 engines on its fleet of 17 A320 family aircraft, and the installation of Rockwell Collins’s Tailwind 560 live TV system on its 15 A330s. The carrier also subsequently signed a major IT deal with Lufthansa Systems, which included the selection of the vendor’s FACE solution as its future reservation and passenger system. In terms of its network, Qatar Airways launched a number of new destinations over the course of the year. These included Yangon, Osaka, Tunis, Algiers, New Delhi, Cape Town, Madrid and Berlin. Further destinations will be added next year, including Hong Kong and, possibly, the USA. To support its global expansion the carrier also invested heavily in marketing, including sponsoring the CNN programme Quest and the Doha 2006 Asian Games. Work also began this year on the construction of the new $5.5 billion Doha International Airport, which is scheduled to open in phases from 2009. The new airport will initially be capable of handling 12 million passengers a year, rising to 50 million passengers when fully developed in 2015.||**|||~||~||~|Royal Air Maroc Royal Air Maroc confirmed its position as one of Africa’s most successful airlines in 2005 with another year of growth. The airline reported that it had carried nearly 4.5 million passengers across its mainline and Atlas Blue operations in the first nine months of the year alone, an increase of more than 20% compared to the same period in 2004. The growth in traffic was attributed to both increasing demand, including a 68% boost on flights to Africa, and to greater fleet utilisation, which hit 11.22 hours per aircraft per day. On the back of this success, RAM also agreed an order for five 787s, which made it the launch customers for the Dreamliner in the Middle East & Africa region. Earlier in the year, the airline also received two more of the large number of 737-800s that it has on order. The airline also launched a number of new routes over the year, including flights to Valencia, Istanbul, Douala in Cameroon, Ouagadougou in Burkina Faso and the French city of Lille. RAM also continued to strengthen its many other operations over the year, as it is following a strategy of turning its diverse operations in 21 different subsidiaries. These include Atlas Blue, as well as Air Senegal and Air Gabon, both of which it has a 51% stake in. RAM may also gain a stake in another carrier, as it is helping six central African airlines to form a regional carrier called Air Cemac. The RAM Group also includes a number of maintenance companies, as well as the CasaAero Training Centre, a training joint venture with Alteon that opened in November. Royal Jordanian Royal Jordanian enjoyed one of its best years ever in 2005, which culminated in the carrier being invited to join oneworld in October. RJ should now become the first airline from the Arab world to join one of the major airline alliances around the end of next year. The invite was proof of the successful turnaround of Royal Jordanian and its transformation into a profitable and reliable airline. The carrier reported a $21.8 million net profit for 2004 and then a $8 million net profit and 15% increase in revenues in the first half of 2005, as the reconstruction of Iraq helped drive business into Amman. RJ’s finances were also boosted by further steps in its privatisation programme. Abraaj Capital, a UAE venture capitalist, bought an 80% stake in Joramco, RJ’s former maintenance division in January. A consortium of Jordanian investors, including RJ, then bought Arab Wings, Royal Jordanian’s former executive flight division the following month. RJ also boosted its operations through a number of initiatives to extend its network and improve its customer service levels. For instance, it signed codeshare deals with Thai Airways and Austrian Airlines during 2005. It also launched new services to Milan and Alexandria, as well as boosting its services to Kuwait and Saudi Arabia. The carrier’s US routes, which are flown in a codeshare with America West/US Airways, were also switched to non-stop in line with the airline’s wider policy of simplifying its timetable. This policy also saw RJ subsidiary Royal Wings turned into a dedicated charter service with its own A320. Regional routes were instead handed over to a new brand, RJ Xpress, which is operating two recently received Q400s from Amman’s main airport, Queen Alia International. Customer service levels were also improved through the introduction of e-ticketing beginning in April. In terms of its fleet, RJ has announced plans to buy 15 regional jets in the near future, which are expected to be Embraer 170s. The airline will also begin to receive a new fleet of IAE-powered A320s over the next two years. Saudi Arabian Airlines The region’s largest airline in terms of fleet size marked its 60th anniversary this year, and it also announced plans to extend its fleet further. The airline became the first carrier in the Middle East to order regional jets when it signed a deal for 15 Embraer 170LRs in April. The aircraft, the first two of which are due to arrive this month, will be used by Saudia to build regional hubs in Hail and Abha. The Saudi flag carrier’s order should also help it fight off proposed competition in the country. Saudia’s domestic monopoly ended this year with the launch of Al Khalaya, an all-business class carrier flying between Jeddah and Riyadh. However, the flag carrier is likely to face greater competition in the years ahead with a number of companies talking about launching a low cost carrier, including the Al Tayyar Group and NAS. Saudia, however, looks to be in good financial order to face competition, even if its privatisation plans have moved forward little over the past 12 months. The carrier earned record revenues in 2004, totalling $3.6 billion, up over 30% on 2003, and a profit of $117.3 million. The airline also improved its customer service levels, by rolling out more self-service check-in kiosks and introducing an SMS-based information service. In terms of its network, Saudia added a twice-weekly passenger service to Hyderabad. Its freighters also began a new route to Shanghai, the airline’s ninth all-cargo destination.||**|||~||~||~|Sudan Airways With a peace deal ending 21 years of civil war in Sudan, the national flag carrier was able to resume a number of long-suspended routes. These included Juba, in the south of the country, as well as Entebbe and Nairobi, the capitals of Sudan’s southern neighbours, Uganda and Kenya. To support this expansion, the airline has expanded its fleet over the year by introducing five Fokker 50s. The Sudanese government is now looking to attract foreign investment in the country’s infrastructure, including a stake in Sudan Airways, and a number of airports. However, US sanctions will probably need to come to an end before major investment can be secured. Syrian Arab Airlines Syrian Arab Airlines continued upgrading its back end IT systems in 2005, signing deals with both Mercator and SITA SC. The airline firstly opted to implement Fastrac, the revenue accounting package from the Emirates Group’s IT arm, before launching a project with SITA to migrate onto internet protocol (IP) based communications. The projects will help the airline to cut its costs, while also enabling a range of new services and functions, including e-ticketing. In terms of its operations, SyrianAir launched a new route to Baghdad in October, and it also began a study to look at other possible destinations, including China and Brazil. The airline was also reported to be nearing a deal with Airbus for seven aircraft earlier in the year, but this is yet to be concluded. Trans Mediterranean Airlines TMA teetered on the brink of collapse all year under the weight of its huge debts. Once the world’s largest air cargo carrier, the airline now no longer even flies its own aircraft, instead buying capacity on other carriers. The airline fired 46 of its 53 pilots over the summer, which led to protests in Beirut, even though none of the pilots had flown for some time. The airline is still looking for a buyer or a merger with MEA, but both look unlikely at present. TunisAir TunisAir suffered the region’s only major air crash this year, when an ATR 72 operated by its regional subsidiary, Tuninter, crashed off the coast of Sicily in August. The crash, which killed 16 people, was thought to have been caused by the fact that the aircraft was fitted with an ATR 42 fuel gauge. This mistake meant that the pilot saw an incorrectly high reading on the instrument panel. Earlier in the year, TunisAir was able to report that it achieved its first net profits in four years in 2004 following an upswing in tourism in the country. The airline had also implemented a two-year restructuring plan that had led to lower costs and 700 job cuts. As a result, it reported net profits of $19.7 million versus a $7.05 million loss for 2003. The first half of 2005, which is traditionally weaker for the carrier, saw a $12.5 million loss, compared to a $11.3 million loss in the same period in 2004. However, the airline is reportedly drawing up plans for a fleet renovation programme. From 2007 to 2016, it is set to introduce between six and 12 new aircraft into its fleet. The airline is also planning to extend its network through the Arabesk project. Yemenia Yemenia agreed a notable deal in October, when it outsourced all of its passenger sales and support functions to Mercator, the IT arm of the Emirates Group. The deal will improve services for the airline’s customers, as well as paving the way for the introduction of e-ticketing. The Yemeni flag carrier also drew up plans to expand its network with the introduction of daily flights to Cairo and Dubai in the near future, and the introduction of nine European destinations next year. Yemenia should also sign codeshare deals next year, as it is a member of the Arabesk project. The airline is also reportedly in discussions with Boeing about plans to buy 10 787s.||**||

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