Oman out of Gulf Air

[Qatar ATC]

Exclusive :

Bahrain , Manama

In a un-expected move has decided to drop out from gulf air. Stay tuned for the press release.

[airpilot_A3xx]

They just announced on OMAN T.V. 21:00hrs local MCT time that Oman has pulled out from GF..:{ COO, you just reassured your pilots that Oman was 201% commited to remaining in GF:confused: WHAT happened then mate:confused:

[Panama Jack]

Rather unfortunate, however, probably just a matter of time. My reading of the tea leaves has been that nearly everyone at Gulf Air expected this during the last few months.

Seems to be a very typical regional phenonemon that statements of "commitment" are made, but then there is a failure to follow-up. Since Hogan's departure, it also seems that the two owner states had radically different views for the future of Gulf Air, including on issues of leadership and commitment especially of the financial nature.

Oh well, at least one less item of uncertainly for Gulf Air's future.

[ironbutt57]

http://www.gulf-daily-news.com/Story.asp?Article=181290&Sn=BNEW&IssueID=30047

it's in the GDN....it must be true!!!!:}

[Desert Diner]

It was only a matter of time.

And probably a positive thing for both a potential GF turnaround as well as the future of Oman Air.

[akerosid]

So what happens to long haul flights to/from MCT now? WY has only just ordered A332s, so it doesn't have the aircraft to operate (for example) LHR-BAH.

Also, given that presumably GF will now move its aircraft onto the Bahrain (A9C-) registry, from Oman's A4O-, could they (legally, in "bilateral" terms) continue to operate that route?

[gtaflyer]

Well its going to be interesting to see the GF schedules when not operating out of MCT, just like when GF stopped operating out of AUH. Could gulf air survive after putting so much time and effort in developing the hub ? whats more important is the loss of revenue from those routes - oh no more profuse bleeding !

[Qatar ATC]

Bahrain now sole owner of Gulf Air

By Habib Toumi, Bureau Chief

Manama: Bahrain has become the sole owner of Gulf Air after Oman said yesterday that it was ceasing to be a stakeholder in the airline with immediate effect.
Oman's formal withdrawal was stated in an official letter delivered by its Economy Minister Ahmad Bin Abdul Nabi Makki to Bahrain's finance minister Shaikh Ahmad Bin Mohammad Al Khalifa at a meeting in Manama.
Following the decision, the Gulf Air board of directors held an impromptu meeting that included representatives from both countries to discuss the modalities of the transfer of the Omani shares and assets which, according to analysts, should last a maximum of six months. However, Bahrain's solo management of the company started yesterday.
Once an aviation sector leader in the Middle East, Gulf Air, initially owned by Bahrain, Oman, Qatar and Abu Dhabi, has run into deep financial difficulties and has needed several cash injections.
Qatar withdrew in 2002 to set up its own airline, followed by Abu Dhabi in December 2005.




Source : http://archive.gulfnews.com/articles/07/05/06/10123309.html

[fractional]

Very much predicted. Nothing new. It was just a matter of time (months to a max of 2 years) from the official of AUH from it.
In absence of a business oriented solution and given the fact that these countries still reel on national flag carriers, I think this is good for both at first look.
GF will downsize/rationalise and WY will continue its growth. The worry here is the big cash gap among the different Gulf national flag carriers and this will not be conducive to cheaper prices for the consumer on the "domestic" routes, and on longer routes the smaller carriers will be bullied by a price (dumping) war steered by QR, EK and EY.
Matters will not even out until all Gulf carriers are privatised and have a REAL and TRULY "open skies policy".

[E Tops]

:ok: Fractional, I agree wholeheartedly with your statement, the only issue is that by the time the Big 3 have to operate as self supporting businesses, will Gulf Air and Oman Air will be History??!! I guess that Saturday's decission by Oman has been secretly what Bahrain has been hoping for, after all of the recent statements in the press by certain high powered board members, and that Bahrain will now be able to push on unhindered (except from internal power stuggles!!!!) to try and make Gulf Air profitable. It is still early days, into the Captaincy of Mr Dose, but he does seem to have been given Carte Blanche to turn things around and that has to be a good thing (doesn't it??)

[bus787]

Gud move for Oman to pullout.
But guys it was a Shock for Bahrain and its managment.
managment was expecting Oman to pull out next year.They had one year to benefit from flights their including 767 posting.
Now GF face with again the WAT TO DO sindrome.

[ttg22]

Maybe it's googd or maybe not we will see....but what about the routes and part of the fleet that aparently Oman is been asking to have back?
What about all our licence?

TTg22

[Desert_Storm]

Think this move will benefit GF. 1st. of all, now we can concentrate on one single hub in Bahrain and do all the flights including Europe from the pearl. 2nd. of all, the small cake (if any!!!) will be spared only here, easier maths and less demands. The only thing GF needs is a little bit of creativity from the top floor and a lot of commitment from the few guys who will remain after all this turmoil. About our license, well, don't see any forthcoming problem with'em since were issued by DGCAM Oman so we can keep flying the A40-tail Nº. planes; don't even need any special purpose certification. Cheers mates!

[Desert Diner]

I suppose that GF will have to stop flying all the routes out of Muscat other then to BAH, I mean that would only be fair now, wouldn't it? :rolleyes:

As for the planes:D

Seriously now, I wonder how much of the $1MM per day loss was comming from the Muscat hub and how much from the Bahrain hub.

[bus787]

Desert you r right u can still fly A40 with Omani licence.

Dont you think it will be a bit silly for GF to leave it like it.

Another country controlling your Fleet and licencing.

they can ground you with a flick of switch.

GF should change to Bahrain licences and reg.

GUD 4 u Guys apparntly bah licence is JAA..

[boiler]

Seriously now, I wonder how much of the $1MM per day loss was coming from the Muscat hub and how much from the Bahrain hub
If you assume that all long haul flying was losing the most money, then BAH will most probably be the one that has incurred the most losses.
Long haul from BAH: LHR, FRA, CDG, DUB, BKK, HKG, SIN, SYD, MNL (9)
Long haul from MCT: LHR, BKK, KUL, CGK (4)
Did I miss anything?

[Icarus]

Yeah you did.
Associated costs of operating out of Oman are higher than Bahrain. Deadheading crew and loss of revenue opportunity from those seats, hotel rooms, transport, delays, long connections and incremental associated passenger costs - more hotel rooms, food, hopeless baggage handling/transfer in MCT and the cost of that ineptitude. Also FRA and CDG begin in MCT and transit Bahrain.

[Bombay HF]

Good point about FRA and CDG. This will obviously hurt the yield on those two sectors with many of the passengers flying GF to get to MCT. This could mean the end for those two sectors if AD insists on only operating profitable routes. 28 aircraft to service the entire network today, how many will be needed when Oman pull out? 22 maybe? Will we have enough pilots to crew 22 aircraft when 100+ pilots pass their EY/QR/EK interviews this week?:confused:

[boiler]

Also FRA and CDG begin in MCT and transit Bahrain.
Regardless of where it starts from, the long-haul is still BAH-FRA and this will be the sector losing the most money, and not the short BAH-MCT sector.

Deadheading crew and loss of revenue opportunity from those seats, hotel rooms, transport, delays, long connections and incremental associated passenger costs - more hotel rooms, food, hopeless baggage handling/transfer in MCT and the cost of that ineptitude.
Maybe, but there is no way you can assign these to the cost of a particular leg. I am talking about pure variable-cost that are incurred by a particular flight (fuel, maintenance, landing, etc...), and not some of the problems you mentioned that cannot be quantified.

[Desert Diner]

Maybe, but there is no way you can assign these to the cost of a particular leg. I am talking about pure variable-cost that are incurred by a particular flight (fuel, maintenance, landing, etc...), and not some of the problems you mentioned that cannot be quantified.

Thats sounds like something comming out of management. A management oblivious to losses.

An airline loses money by incurring more costs than making revenue. As to RASM on the outbound Bahrain flights, especialy to Europe, is pretty healthy, even in the back cabins, it would suggest that the losses are coming from base costs.

And in your own words:

Long haul from MCT: LHR, BKK, KUL, CGK (4)


GF is maintaining a base for 4 destinations?:eek:

[fractional]

GF will benefit from this breakup since the economics did not make sense to Oman and Bahrain as partners. The same applies to Abu Dhabi, Qatar and Dubai before. Oman Air will also benefit because the government will not be its eyes on "2 kids". They had always complained of not flying non stop to certain intercontinental destinations from MCT. Well, now they only need to get those airliners and fly them.
GF will now have to look at their home market, serve the high yield business just like EK did at the beginning, strengthen the regional market and the shaken customer base and finally expand its business by targetting "the through traffic" just like the other ones do. Downsizing is rational.
Airlines such as GF, KU, SV, QR, EK, EY, WY and even G9 are here to stay and will never close they way they are right now. The same cannot be said about Jazeera, Sama and NAS.
Almost all these Gulf airlines are state run companies after all despite all sorts of denials where their traffic rights will be always protected which is acceptable. Other airlines worldwide still do it. Obviously, the markets in Europe and America have opened up but only less than 10 years ago where you may an English based airline operating a CDG-FRA route, etc..
It would be interesting to see the different UAE National Airlines operating regionally and internationally from other UAE airports other than theirs in a real sign and test of "open skies". Would it be a clean and equal "fight"? It could make economic sense.
EY would operate through DXB and SHJ, EK through AUH and AAN, besides having G9 operating doing the same through AUH and AAN, etc.. It's a thought that could lead to certain disconfort in the individual Emirates within the UAE.

[boiler]

GF is maintaining a base for 4 destinations?:eek:

I did not say the MCT hub was based on 4 destinations. I would hardly call the ISC as long-haul. I was just comparing the long-haul operations from BAH and MCT. That is all.