Air Arabia was founded in 2003 as the UAE's third airline. It has grown to become the largest low-cost carrier in the Middle East and North Africa region. Air Arabia connects destinations across the Middle East, Europe, North Africa and Asia with its fleet of over 50 Airbus A320 aircraft. Through innovative techniques like sharklet technology, Air Arabia is able to keep prices 40% lower than other airlines while expanding its network to over 130 destinations. This low pricing strategy has helped Air Arabia attract over 55 million passengers and achieve high revenues despite lower prices by focusing on increasing its customer base. Air Arabia faces ongoing challenges to maintain low prices while managing costs as fuel prices rise.

2. The Start
• Started as Government owned startup
• Founded in February 2003
• UAE’s 3rd airline
• With 2 leased A320 jets

3. Middle East and North Africa's largest Low Cost Carrier (LCC)
Travel prices are generally 40% lower than usual economy prices

4. Current Fleet has 50 Airbus A320 Aircrafts
&
44 new A320 Aircrafts coming soon ..….!!

5. Connects Middle East to Europe, North Africa & Asia
Over 130 destinations

6. And still ex pand ing…..

7. • 160 passenger capacity
• Larger cabin space
• High Comfort with 32 inch seat pitch
• Best legroom with 18 inches seat width
At such a low price

8. How
Is
This
possible

9. Uses sharklet technology to reduce emission
Curved attachments to wings to allow higher takeoff weight
Uses innovative techniques to boost efficiency
Manages fluctuations in fuel price well ahead of time
1
2
3
4

10. Pricing Strategy
Keeping prices low attracted large no. of customers
55 million passengers till now

11. Dedicated efforts towards customer service

12. “Pay less, fly more” motto
Air Arabia has made air travel possible even for them
who could not afford flying expenses

13. Revenue
0
500
1000
1500
2000
2500
3000
3500
4000
2004 2006 2008 2010 2012 2014
Turnover (AED m)
(Low price) * (High no. of customers) = High Revenue

14. Low High
Low
High
Economy
Pricing
Market
Penetration
Market
Skimming
Premium
Pricing
Price
Quality
All these efforts made air arabia market leader in LCC category

15. Let’s have a look at the success journey

16. Awards
• “Middle East's Leading Low-Cost Airline” at the World Travel Awards 2014
• “Airline Business Award” at the esteemed Airline Strategy Awards 2014
• “Best Low Cost Carrier in the Middle East” at Skytrax World Airline Awards 2015
• “Customer Innovation (Loyalty Scheme)” at the Aviation Achievement Awards 2015

17. Continued….
• “Best Low-Cost Airline” at the World Tourism Forum 2015
• Air Arabia ranked 3rd among top 50 airlines in the world in 2016
• “Low Cost Carrier of the Year” at the Aviation Business Awards in
2014, 2015, 2016

18. Challenges
What are the challenges that Air Arabia has to face ?

19. • To provide great value at the lower price
• To manage it's R&D, Operation & staff expenses despite collecting low
fare from the passengers
• To keep fare prices low even when fuel prices in the market are rising
• Difficulty in attracting rich segment customers
Challenges

20. Summary

21. DISCLAMER
Created by Shreyash Wadbudhe, VNIT Nagpur, during a marketing
internship by Prof. Sameer Mathur, IIM Lucknow.