Kuwait's Jazeera Airways is in talks with competing engine-makers Pratt & Whitney and its current supplier CFM International for a jet engine order and aims to make a decision by the middle of next year.
The budget airline began preliminary discussions with CFM, a General Electric and Safran joint venture, and Raytheon-owned Pratt & Whitney, but is so far “not happy” with the offers from both manufacturers, Jazeera Airways' chief executive Rohit Ramachandran told The National on Tuesday.
“Discussions will continue and we will use this year and part of next year to ensure we have the right terms,” Mr Ramachandran said.
“We will finalise a decision by mid-2024 … we are hoping for better commercial terms and technical guarantees.”
In January 2022, the airline's board approved a $3.4 billion deal to buy 28 narrow-body aircraft from Airbus after signing a preliminary agreement at the Dubai Airshow in November 2021. The deal included 20 A320 Neos and eight A321 Neos.
The engine manufacturers submitted their bids after Jazeera Airways issued a request for proposals in May 2022.
The discussions come as the aviation industry faces supply chain disruptions that have left suppliers and manufacturers scrambling to source raw materials and keep production moving.
A decision on engines to power the aircraft will need to be made about two years ahead of the jets' scheduled delivery starting in 2026, according to Mr Ramachandran.
The comments came after the low-cost airline on Tuesday posted a record annual profit in 2022 on the back of strong travel demand and cost-control measures.
Net profit surged to 20.1 million Kuwait dinars ($66 million) last year, up 184 per cent from 7.1 million dinars in 2021, as the airline tripled the number of passengers carried to 3.6 million.
Load factors, a measure of how well the airline fills available seats, rose to 77 per cent last year. This has offset a decline in yield, or the average fare paid per passenger, by 35.1 per cent to 47.96 dinars.
The record annual profit came despite a “dramatic” increase in fuel prices that added about 9 million dinars to the airline's costs, Mr Ramachandran said.
The airline posted a fourth-quarter net loss of 700,000 dinars, from 7 million dinar profit in the same period of 2021.
The executive expects the airline's annual net profits in 2023 to exceed last year's record levels.
“We fully expect 2023 to be a significantly better year than 2022 and January is evidence of this view we hold, in terms of every single commercial metric,” he said.
Strong demand, low unit costs, load factors of about 80 per cent, healthy yields and “new and current destinations are expected to shore up a very strong result in the first quarter and for the year in general”.
Jazeera Airways “stands to benefit” from the current global economic conditions because of its low-cost business model and a focus on costs, he added.
“You have people who tighten up discretionary spending and go towards low-cost airlines rather than full-service carriers and in that respect LCCs can stand to benefit in adverse economic conditions,” he said.
“Secondly, we have a very tightly controlled cost structure, so when input costs go up because of higher inflation, we’re in a position to make a profit even with reduced margins.”
The airline group's earnings have also benefitted from revenue from its duty-free business at its own terminal. It also benefitted from its own aviation training organisation that provides it with both a “steady pipeline of talent” and a “great source of revenue” from the students paying for the training, he said.
COMPANY%20PROFILE
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How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
How does ToTok work?
The calling app is available to download on Google Play and Apple App Store
To successfully install ToTok, users are asked to enter their phone number and then create a nickname.
The app then gives users the option add their existing phone contacts, allowing them to immediately contact people also using the application by video or voice call or via message.
Users can also invite other contacts to download ToTok to allow them to make contact through the app.
Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
WandaVision
Starring: Elizabeth Olsen, Paul Bettany
Directed by: Matt Shakman
Rating: Four stars
UK's plans to cut net migration
Under the UK government’s proposals, migrants will have to spend 10 years in the UK before being able to apply for citizenship.
Skilled worker visas will require a university degree, and there will be tighter restrictions on recruitment for jobs with skills shortages.
But what are described as "high-contributing" individuals such as doctors and nurses could be fast-tracked through the system.
Language requirements will be increased for all immigration routes to ensure a higher level of English.
Rules will also be laid out for adult dependants, meaning they will have to demonstrate a basic understanding of the language.
The plans also call for stricter tests for colleges and universities offering places to foreign students and a reduction in the time graduates can remain in the UK after their studies from two years to 18 months.
Honeymoonish
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The 12
England
Arsenal, Chelsea, Liverpool, Manchester City, Manchester United, Tottenham Hotspur
Italy
AC Milan, Inter Milan, Juventus
Spain
Atletico Madrid, Barcelona, Real Madrid
The biog:
From: Wimbledon, London, UK
Education: Medical doctor
Hobbies: Travelling, meeting new people and cultures
Favourite animals: All of them
Villains
Queens of the Stone Age
Matador
Analysis
Members of Syria's Alawite minority community face threat in their heartland after one of the deadliest days in country’s recent history. Read more
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
More Iraq election coverage:
Profile box
Company name: baraka
Started: July 2020
Founders: Feras Jalbout and Kunal Taneja
Based: Dubai and Bahrain
Sector: FinTech
Initial investment: $150,000
Current staff: 12
Stage: Pre-seed capital raising of $1 million
Investors: Class 5 Global, FJ Labs, IMO Ventures, The Community Fund, VentureSouq, Fox Ventures, Dr Abdulla Elyas (private investment)
