Air Arabia, established in 2003, has become the largest low-cost carrier in the Middle East and North Africa, operating over 150 destinations with a fleet of 44 Airbus A320 aircraft. The airline focuses on providing affordable prices, with fares averaging 40% cheaper than regular economy, while maintaining a strong customer service orientation. Despite facing competition and potential market challenges, Air Arabia's strategic innovations, such as fuel hedging and technology upgrades, have positioned it for consistent profitability and growth.

1. Pay-less, fly more

2. Took off in 2003 with only two leased Airbus A320 jets
Today fly over 150 destinations using 44 A320 aircrafts
Become the Middle East and North Africa’s first and
largest low cost carrier (LCC)

3. Great Flying Experience
Affordable Price
Good Customer
Service

4. Plan was to target 85% potential regional customers
who cannot afford normal flying experience
Prices are on an average 40% cheaper than the regular
economy fare

5. Offering one of the most And all are fitted with
spacious economy cabin world-class comfort seats

6. Ready to serve its customers Flytivities
Special assistance to pregnant women
and passengers with special needs
Airport
Activities
Flytivities
Airport
Activities

7. How do they do it?!

9. Opting for brand new planes has reduced fuel
costs and environmental impact

10. This is your captain
speaking. Welcome
aboard!
Using a universal aircraft
model lowered their training
expenditure.

11. In 2012, Air Arabia smartly equipped its fleet with sharklet
technology to reduce emissions by upto 4% on fuel-burn

12. Air Arabia
foresaw the
inevitable
fluctuations of
fuel price and
dealt with them
ahead of time by
a fuel hedging
strategy to
constantly
maintain its low
prices and thus
preserve

13. CSR
(emotional bonding)
Online booking app
(Manage Booking)
Airewards
(Customer Loyalty)

14. Price Cutting Traps
Air Arabia dodges all the
price cutting traps. Unlike
many other low-priced airlines, Air Arabia has
consistently kept its vision customer oriented :
its crew members are dedicated and view
passenger’s comfort as key to the company’s
success.

15. Value Pricing
Provide great
flying experience
with good customer
care at low cost
Loyal
Customer
Cost cutting
strategy
accompanied by
customer
oriented vision

16. AWARDS
Stood as the
most
admired
airlines in
the Middle
East

17. EXPANSION
5 Hubs
Air Arabia growing foot print based in
UAE, Morocco, Egypt and Jordan
AED 11 billion
Air Arabia’s total assets
Over 116
Global routes
Over 55 million
Passengers till date
AED 531 million
Air Arabia’s net profit in the year 2015

18. Lets try to answer some questions regarding the Case Study
on Air Arabia Airlines in “ Marketing Management “ by Philip
Kotler and Kevin Lane Keller

19. Why don’t all other airlines
apply the same business
model as Air Arabia?
Other rivals targeted comfort and
luxury driven consumers and shifted
their focus to hybrid model. But Air
Arabia has always been keen on serving
people who can’t afford to pay high
prices for travelling via air. This makes
Air Arabia to provide lowest cost prices
than anyone else. Also other companies
might be hesitating in applying same
business model as Air Arabia because
then they send bad message to its target
segment that they lack innovation and
creativity.
What challenges does Air
Arabia face?What will happen
if other airlines apply the
same business model as Air
Arabia?
There is always threat from new
entrants and other low-priced airlines
as they may decrease its sale rates.
Also if Air Arabia expand to bigger
airports then it may suffer problem due
to large pressure on cost. But still
concerning to its present growth late in
innovation and managing capabilities no
other companies stood against it in the
field of low cost carriers (LCC).

21. Disclaimer
Created by Akshay Mahajan, IIT Kanpur, during a
marketing internship under Prof. Sameer Mathur,
IIM Lucknow.