Air Arabia considers future fleet order

The airline is now looking in to buying new narrow-body aircraft from Boeing.

Analyst Saj Ahmad commented: In the same way that flydubai stuck with the 737 MAX 8 family to follow on from its existing 737-800 fleet, there is a very good argument for Air Arabia to extend its current A320 family into the A320neo as part of its future fleet needs.
 
“That said, the critical differentiator may well come down to how yield per seat affects Air Arabia given that its current A320s are configured to carry between 4-7% fewer passengers. That may not seem much, but the key element is the 12 business class seats that flydubai enjoys as a revenue-generating advantage that Air Arabia is losing on every single flight since it lacks a comparable business class product. This has been a huge money spinner for flydubai.
 
“That added revenue is bound to influence the selection of either the A320neo or 737 MAX. Boeing has obviously been pitching these sorts of attributes in order to "flip" an A320 customer over to the 737 MAX like it has done with United Airlines and Silk Air, but Air Arabia will be keen to see whether the cost of switching fleets is more costlier than staying with the incumbent type in operation.”
 
Ahmad added: “With flydubai making a massive statement of intent at the 2013 Dubai Air Show with a huge order for 75+25 737 MAX 8s, Air Arabia has, from UAE-originating routes at least, been pushed back into second place behind its Dubai rival. If it aims to draw parity, then the size of its impending order as well as the airplane it selects will undoubtedly be a make-or-break decision as they look to catch up to flydubai.”