Gulf Air has baffled industry observers and turned around its fortunes from near-collapse to profitability.GULF AIR has in the past five years suffered from just about every twist of fate that can befall an airline. Questionable management practices plunged the airline into the red, to the tune of US$159 million in 1995. And when two major shareholders, Qatar and Oman, launched their own carriers, the aviation industry began speculating that it might even fold.
A lot has changed since Gulf Air's management team was taken over by its current president and CEO, Dr Sheikh Ahmed bin Saif al-Nahyan, previously a pilot for the carrier and a member of the powerful ruling family of Abu Dhabi, the largest of the seven federating units of the United Arab Emirates.
He took over at the helm when the airline was in deep trouble, but with the confidence that he would have the full political and financial backing of his family. It was the al-Nahyan who shamed the governments of Qatar and Oman into recommitting themselves to the future of Gulf Air by offering to buy out their stakes.
That offer was not just a simple commercial move: Abu Dhabi was well aware that the struggling economy of Bahrain (the fourth equal partner) would suffer tremendously if the airline crashed.
Three years on and it is as if the crisis never happened. The reinjection of capital from all four owner-governments that resulted from Abu Dhabi's decisive move provided Gulf Air with the impetus it needed to return to profit in 1997 and 1998.
"The resurgence in the financial strength of Gulf Air and its progressive trends have been acknowledged... it is a matter of gratification that Gulf Air merited a prominent position in the list of top 100 airlines of the world," Sheikh Ahmed said.
On the operations side, Gulf Air Cargo has led the way, with volumes expanding by 10.2 per cent last year to 134,311. It has stolen the march on passenger numbers, which were up 3.4 per cent to almost 5.1 million.
Both sides of the business are set to expand further with the airline's decision to invest in six new Airbus A330-200s, the first of which was delivered this June.
By the end of this year, four will have been pressed into service, with the remaining two due to arrive in the first quarter of 2000. Then Gulf Air can decide whether it wants to avail the six more it has options on.
Not surprisingly, Sheikh Ahmed sees the arrival of the A330-200s as a milestone for the carrier.
"Gulf Air has invested more than $550m in the purchase of (the) six Airbus A330 aircraft, reflecting the commitment of the airline to constantly modernise its fleet, providing better quality products and higher standards of service to its customers," he said.
"We have spared no effort to equip the aircraft with the best systems available in the industry, reflecting our commitment to offer value-added services."