Royal Jordanian Airlines will add seven Brazilian Embraer 195 aircraft to its fleet to expand its regional network and tap booming air passenger demand in the Middle East, its CEO said on Wednesday.
Chief Executive Samer Majali said the deal with Embraer for the seven planes, to be signed on Wednesday, will give the airline an edge over rivals, especially in fast-growing routes in the Middle East and east Mediterranean.
"We are trying to place ourselves to be the dominant carrier in the Levant. We want to create Amman as the regional hub for the Levant region," Majali said.
The airline was the first commercial airline to resume flights to Iraq after the war in 2003.
Royal Jordanian is state-owned but the government plans to part-privatize it, possibly as early as this year.
Four of the aircraft have been acquired in a capital lease in deal worth USD$130-$140 million. The other three are on operating leases but no details of these contracts were available.
The airline is also taking delivery of six new Airbus planes -- four A320 and two A321 planes -- all of which will be in service by the end of 2006.
Royal Jordanian has a three-year modernization scheme to expand its fleet to 35 aircraft from 21 to serve a far-flung network of over 50 destinations across Asia, the Middle East and Africa.
Majali said the airline would take delivery of two of the Embraer planes in October and December of this year and three more in 2007 and the last two planes in 2008.
"They are optimal in terms of size and allow you to increase frequency and keep your costs fairly low," Majali said.
Royal Jordanian has over the last year added more flights to key Arab destinations and cities such as Cairo, Beirut, Aleppo, and Alexandria along with more flights to Gulf destinations and expanded its lucrative Iraq network serving Baghdad, Basra and Arbil.
Jordan is a major logistics and business hub for Iraq.
Majali said the firm was cashing in on growing regional travel helped by liberalization of air policies in the Middle East that cleared remaining restrictions on foreign carriers.
Intra-regional travel has been boosted by the September 11 attacks on the United States which hampered Arab travellers from flying outside their region, Majali said.
Royal Jordanian is boosting its flights and service within the Middle East in contrast to a policy of streamlining flights to long-range US and Asia destinations.
"The growth in our regional network is the highest growth rate of the entire system," Majali said.
Royal Jordanian flew 1.8 million passengers in 2005 with revenues expected to rise to 469 million dinars (USD$661.5 million) this year against 387 million dinars in 2005. It has co-sharing marketing alliances with many airlines, including Austrian Airlines, America West and Thai Airlines.
