ABU DHABI // Potentially thousands of AirAsia X ticket-holders hoping to fly between the capital and Kuala Lumpur have been left in the lurch after the long-haul budget airline announced yesterday it was shutting down its Abu Dhabi service.
Barely five months after the carrier announced plans to establish Abu Dhabi as its base in the Middle East to launch onward flights to Europe, the long-haul arm of the low-cost carrier AirAsia began informing customers that flights up to October were cancelled.
The carrier called the move temporary and said it hoped to return to Abu Dhabi.
"We're basically contacting all of our customers who have booked flights to basically say, in fact, we've suspended our service for commercial reasons," said Azran Osman-Rani, the chief executive of AirAsia X.
Flights this month will be reduced from five to three a week, with the last trip scheduled on February 21. More than 30 weeks of flights until October will be cancelled. Ticket-holders on the Abu Dhabi-to-Kuala Lumpur route will be refunded, Mr Azran said.
The chief executive cited "underwhelming" demand for tickets, uneconomical aircraft and an aviation industry crippled by the financial crisis as reasons for the suspension of Abu Dhabi flights to and from Kuala Lumpur.
The airline employed a four-engine Airbus A340 on the route, with 256 seats in economy and 30 premium seats.
AirAsia X hopes to resume services in the future using a smaller, twin-engined A330 aircraft.
"We are not going to be flying, period, to Abu Dhabi until we figure out what's the right strategy, the right hub, the right aircraft and we'll probably come back again," Mr Azran said.
AirAsia and its AirAsia X affiliate fly to more than 130 destinations in China, South East Asia and Australia from its base in the Malaysian capital.
Through its no-frills business model, AirAsia said it typically offered fares up to 60 per cent lower than its competition.
Abu Dhabi ticketholders such as Nafisa Robella were forced to scramble following the news.
Ms Robella and her parents were preparing to fly to Kuala Lumpur on February 20 when she was informed on Saturday that her flight was cancelled.
"I've booked up holiday packages from AirAsia tours and transfers and hotels," she said. "I pre-booked it all, which was about Dh4,000 just for my parents."
The freelance television producer, 28, said she did not have travel insurance and would likely not be refunded for her other travelbookings expenses. She has been told that her return flight may be cancelled as well. "I don't think I can get my money back," she said.
In Kuala Lumpur, the changes also ruined Adrianna Tan's plans for a cheap trip to the Emirates. Ms Tan, 24, a photographer, was planning to purchase tickets on AirAsia X to attend a wedding in October.
"I usually used an AirAsia destination as a jumping-off point to somewhere else," Ms Tan said last night. "I was going to plan maybe Yemen or Syria."
"It's going to make it harder to pop by the UAE."
A spokesman for Abu Dhabi Airports Company said: "AirAsia X has confirmed to Abu Dhabi Airports Company [ADAC] that, from late February 2010, the airline will temporarily suspend its current, five-times-per-week, service to Abu Dhabi.
"ADAC looks forward to the airline recommencing its service to Abu Dhabi International Airport in the near future. ADAC would like to advise any passengers who feel they may be affected by the AirAsia X announcement to contact the airline directly for further details."
The AirAsia X decision to stop serving Abu Dhabi comes as a surprise, as the airline as recently as November joined with local aviation and tourism officials to trumpet its Abu Dhabi flights as a new era of budget travel.
The decision to pull out after just a few months, when airlines typically require years to make a route profitable, added to the mystery.
Also, while it was pulling out of Abu Dhabi, the airline was growing elsewhere; last week it announced Mumbai and Delhi as new destinations planned for this year on A330 aircraft.
"What I understood was that their flights were full, so I don't know what happened," said Jim el Murr, the general manager of Salem Travel in Abu Dhabi. He said the airline could have reached out more to local travel agents; many UAE residents are still unable to purchase tickets online via credit card.
Mr Azran said the airline would continue to fly to Australia, China and London and that holiday-makers could still re-route their flights to those destinations at no extra cost.
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Company%20Profile
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COMPANY PROFILE
Company name: BorrowMe (BorrowMe.com)
Date started: August 2021
Founder: Nour Sabri
Based: Dubai, UAE
Sector: E-commerce / Marketplace
Size: Two employees
Funding stage: Seed investment
Initial investment: $200,000
Investors: Amr Manaa (director, PwC Middle East)
Business Insights
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COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
The specs
Engine: 3.5-litre twin-turbo V6
Power: 380hp at 5,800rpm
Torque: 530Nm at 1,300-4,500rpm
Transmission: Eight-speed auto
Price: From Dh299,000 ($81,415)
On sale: Now
Kanguva
Director: Siva
Stars: Suriya, Bobby Deol, Disha Patani, Yogi Babu, Redin Kingsley
Wicked
Director: Jon M Chu
Stars: Cynthia Erivo, Ariana Grande, Jonathan Bailey
TO A LAND UNKNOWN
Director: Mahdi Fleifel
Starring: Mahmoud Bakri, Aram Sabbah, Mohammad Alsurafa
Rating: 4.5/5
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
The specs
Engine: 2-litre or 3-litre 4Motion all-wheel-drive Power: 250Nm (2-litre); 340 (3-litre) Torque: 450Nm Transmission: 8-speed automatic Starting price: From Dh212,000 On sale: Now
Nayanthara: Beyond The Fairy Tale
Starring: Nayanthara, Vignesh Shivan, Radhika Sarathkumar, Nagarjuna Akkineni
Director: Amith Krishnan
Rating: 3.5/5
Company%20Profile
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ABU%20DHABI'S%20KEY%20TOURISM%20GOALS%3A%20BY%20THE%20NUMBERS
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The specs
Engine: 1.6-litre 4-cyl turbo and dual electric motors
Power: 300hp at 6,000rpm
Torque: 520Nm at 1,500-3,000rpm
Transmission: 8-speed auto
Fuel consumption: 8.0L/100km
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On sale: now
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
Pakistan Super League
Previous winners
2016 Islamabad United
2017 Peshawar Zalmi
2018 Islamabad United
2019 Quetta Gladiators
Most runs Kamran Akmal – 1,286
Most wickets Wahab Riaz –65
