flydubai is charting its own path to success

The new discount carrier is on the move, as its executives relocate and it establishes its own identity serving smaller cities that are below the radar of the big carriers.

DUBAI, UNITED ARAB EMIRATES - AUGUST 9:  An Emirates and a flydubai plane on the tarmac at Terminal 2 of the Dubai International airport in Dubai on August 9, 2009.  (Randi Sokoloff / The National)  For Stock. *** Local Caption ***  RS042-080909-flydubai.jpg
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This month, executives of flydubai will complete their move from spacious digs at the Emirates Group headquarters and begin a new phase for the budget airline at a more humble building close to Terminal 2, the hub for many budget flights to the Indian subcontinent and Iran. This relocation is in line with the carrier's no-frills business model and marks the cutting of many ties to Emirates Airline. Dubai had wanted to start a low-cost airline for some time, but did not have sufficient capacity at Dubai International Airport, according to Ghaith al Ghaith, flydubai's chief executive. When Emirates began preparations to move its network over to Terminal 3 last year, which would free up space at the airport's other terminals, the opportunity for a new carrier finally opened up. From those early days, it was clear flydubai needed to forge its own culture and identity. "From day one, we made a decision that there would be no link with Emirates," Mr al Ghaith has said. However, Dubai did rely heavily on Emirates's considerable experience to launch the new carrier. When the start-up was announced by a Dubai Emiri decree last March, it was stated that Emirates would "support" the new company to get off the ground and it was not long before its first executives were working out of Emirates new headquarters. As well, both airlines have the same chairman, Sheikh Ahmed bin Saeed, the central figure in Dubai's aviation industry. In addition, Mr al Ghaith had been one of highest ranking Emirates executives until he was tapped to head the budget airline. Flydubai's founders had a number of potential models to study. Southwest Airlines in the US has largely bucked the downturn and recorded profits, while Ireland-based Ryanair is the world's largest international airline by traffic, having carried 49 million passengers last year. Still, the start-up wanted to find its own way. "We've always said we want to be the flydubai of Dubai," Mr al Ghaith says. Now that the airline has been flying for three months, it is clear flydubai is indeed charting its own course. Everything from the airline's route network, fare structure product, culture as well as its look and feel are being created in-house. The airline is a relative latecomer to the region's budget airline market, after Air Arabia brought cheaper aviation to the Middle East in 2003 and Jazeera Airways launched in Kuwait two years later. For its part, flydubai is a classic lean-and-mean budget airline, using just one aircraft type, the Boeing 737-800, to reduce maintenance and training costs. Unlike Jazeera or Air Arabia, it does not allow free check-in baggage and luggage fees are a source of revenue. It also wants to be the first airline to eliminate check-in desks, with passengers eventually printing their own e-tickets and heading straight to security. It has also eschewed the top-heavy corporate structure of full-service airlines, with their extended list of senior vice presidents. The airline has a small but growing executive team without the corporate titles. Its third employee hired, for example, is in charge of customer experience and inflight product development but only goes by the title of manager. Despite its focus on frugality, flydubai is trying to leave its mark on the industry. Small flourishes include a colourful cabin design to make budget travel less drab, with two-toned food trays as well as operating the only aircraft with an orange recline button. To do away with plastic, it uses paper packaging for the sandwich wraps sold in flight, and these hot snacks require no utensils. Perhaps most importantly, flydubai's seats offer two more inches of legroom than other airlines. It accomplished this by moving up the seat's magazine above the food tray, freeing up the lower back of the seat. And flydubai's ultra-thin seats are made of carbon fibre and weigh about 12.5 kilograms. That is less than the average airline seat, which saves flydubai more than US$100,000 (Dh367,300) a year per aircraft on fuel costs according to a back-of-the-envelope calculation by flydubai executives. After launching a few initial routes to serve UAE workers from Syria, Egypt and Lebanon, a new strategy is beginning to unfold. With its latest route to Djibouti, flydubai is showing it is not just following Air Arabia's network but is targeting cities that would be considered too small to be viable for the wide-bodied aircraft of Emirates or the other big airlines. Although flydubai suffered a setback when it recently postponed the launch of its India flights, the subcontinent features prominently in its plans, as will the GCC. Longer term, it is looking to Iraq, Iran and Africa. The emphasis on smaller cities, especially outside of India, will help reshape some views of the airline and its ambitions. Some analysts had suggested that Dubai was launching flydubai to protect Emirates from Air Arabia's success in serving India, even if it meant diminishing demand for Emirates. "Emirates Airline's market share in the Middle East-India traffic stands at 24.4 per cent and we suspect the group is introducing an affiliated [low-cost carrier] to cannibalise its own sales, rather than losing the market share to Air Arabia," EFG-Hermes said in a report. "Emirates Airline could be the main loser as flydubai could take significant market share, especially given that it will operate out of Dubai," it said. But as it launches connections to new and untapped destinations, it is becoming clear that flydubai is no longer under Emirate's wing. Flydubai may aspire to be as successful as its big sister, but will do so in its own way.