Kuwait Air mulls new US route

Kuwait Airways Co. is considering adding a flight to Washington DC or Chicago despite mounting US travel restrictions, as the Gulf carrier revives long-standing efforts to better compete with its regional rivals.

The additions, which may also include new service to Seoul, Manchester, Sarajevo or airports in China, Morocco and Saudi Arabia, are part of a wide-ranging restructuring as Kuwait Air aims to return to profit and lure more high-end customers, Chairman Sami Al Rushaid said in an interview.

Kuwait Airways, one of the Gulf's most successful airlines before the 1990 Iraqi invasion of the country destroyed many of its planes, has been trying to counter the growth of Emirates and Etihad Airways for years. Its ambitions are being hampered by some of the toughest business conditions in decades, with challenges ranging from US travel restrictions to reduced spending power in the region due to low oil prices.

In a bid to compete more effectively in a crowded aviation market, Kuwait Airways has been aiming for a privatisation since parliament authorised a sale in 2008. That plan was recently delayed again after a parliamentary committee in June said it wants the company to remain under government ownership. If a full sale doesn't go ahead, the carrier may decide to sell individual units such as cargo and ground handling instead, Al Rushaid said.

Al Rushaid is revising the carrier's restructuring plan and expects it to post a profit by the 2020/21 fiscal year. Kuwait Airways previously targeted profitability in 2019.

Kuwait Air, which competes on short-haul flights with the locally-based Jazeera Airways, currently flies to 38 destinations, including the biggest European hubs and southern Asian cities such as Mumbai and Bangkok. Its longest route serves New York via Shannon, Ireland.

The carrier's new long-haul routes would be served by Boeing 777 planes that it already owns or has on order. Kuwait Air, which still expects to take delivery of three more 777-300ER models including the final one in August, will finance the deals through an initial sale and leaseback agreement signed this month with Kuwait-based Aviation Lease and Finance Co.

The airline also still expects to take delivery of 15 Airbus SE A320neo planes and 10 A350-900s, whose financing will probably be a mix of bank loans and leasing, according to Al Rushaid. Aircraft deliveries should be completed sometime in 2021 and there are no plans for any more orders.

Courtesy: Gulf News
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