|The end of the runway for Bahrain Air|
Although the news might have been unexpected for some, Bahrain Air has been skating on thin ice as a result of continued market challenges, including political instability in parts of the Middle East and North Africa, such as its home country.
According to an official statement, the carrier was instructed to suspend flights to several destinations in 2011, during Bahrain’s State of National Emergency, but received no compensation, despite making official claims.
“The airline is now being required to make immediate payments on past government debts or face closure at the same time as having its scheduled operations, both destinations and frequencies, being reduced considerably by the Civil Aviation Affairs in the Ministry of Transportation,” continued the statement, which was placed on the homepage of Bahrain Air’s website.
“This effectively strangles the airline by simultaneously requesting payments and reducing its ability to generate the necessary revenues both to make these payments and to sustain long term profitability. The airline has also spared no effort to negotiate a solution with the Minister of Transportation (who is also an active board member of Gulf Air). However, he has shown no inclination to provide a meaningful solution. His decisions to restrict route approvals have cost the airline BD 4.5 million in lost revenues over the last 3 months.”
In what appears to be finger pointing, the statement added that Bahrain Air’s AOC was only extended for two months instead of one year by the Minister, even though operational audits had been passed. “In the circumstances, given the position of the Minister, the shareholders decided that had no option but to discontinue financial support and put the company into voluntary liquidation.”
Ending on a sombre note, the airline concluded that the decision marked a “sad day for all Bahrain Air shareholders and employees, and for our loyal and valued guests, and all those who valued the freedom of choice when making their travel plans”.
UPDATE: Bahrain Air CEO Richard Nuttall has told Gulf Daily News that its employees would be ‘taken care of’, according to a news report. "We have close to 300 airline staff who will be affected by this decision. We are working on guidelines to ensure they will get what they deserve," he said, adding that all of the carrier's aircraft were leased and the process of returning the planes would start shortly.
I’m saddened by the news – I have interviewed both the Managing Director and CEO of the airline on numerous occasions and admired their visions and hopes. What do you think of the decision? As always, please feel free to share your comments here, and you can also get in touch on Facebook, Twitter and Google+ - I look forward to connecting with you!
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