UAE's Etihad, Air Arabia launch new low-cost airline

Etihad Aviation Group, the owner of low-cost carrier Air Arabia, on Wednesday announced the signing of an agreement to launch 'Air Arabia Abu Dhabi' - the first low-cost carrier of the UAE capital.

Etihad and Air Arabia will set up an independent joint venture company that will operate as a low-cost passenger airline with its hub in Abu Dhabi International Airport. The new airline will complement Etihad's services from Abu Dhabi and will cater to the growing low-cost travel market in the region.

"With the emirate's diverse attractions and hospitality offerings, travel and tourism play a vital role in the economic growth of the capital and the UAE. By partnering with Air Arabia and launching Abu Dhabi's first low-cost carrier, we are serving this long-term vision," said Tony Douglas, Group Chief Executive Officer, Etihad Aviation Group.

"This exciting partnership supports our transformation programme and will offer our guests a new option for low-cost travel to and from Abu Dhabi, supplementing our own services. We look forward to the launch of the new airline in due course," he added.

Adel Al Ali, Group Chief Executive Officer, Air Arabia, said this step "demonstrates the strength of the UAE aviation sector and serves the vision driving its growth".

"We look forward to a successful partnership and the launch of the new carrier," he added.

Based in Abu Dhabi, the new company will adopt the low-cost business model. Its board of directors, consisting of members nominated by Etihad and Air Arabia, will steer the company's independent strategy and business mandate.

The UAE's travel and tourism sector contributes to over 13.3 per cent of the country's GDP and enjoys a prominent standing as a global aviation hub.

The Middle East and North Africa's low-cost air travel model was first introduced in the UAE in 2003 and has been rapidly growing since then.