We were informed in July about Armenia's plans to launch a low-cost national airline. The name of the airline has been revealed and more details are available.
Armenia's new national airline is in the works
Air Arabia and Armenia's National Interests Fund (ANIF), signed an agreement in July to establish a national airline in Armenia. The airline will operate as a low cost passenger airline based in Yerevans Zvartnots International Airport.
The new national airline, as it is described, is designed to:
Boost Armenia's rapidly-growing tourism and travel sector. In 2019, this made up 11.8% GDP and accounted 12.5% of Armenia's employment.
Contribute towards the country's economic growth
Armenians have a reliable and affordable option for air travel
Air Arabia is the largest low-cost carrier in the Middle East, North Africa. Although the airline is based out of Sharjah in the United Arab Emirates, there are subsidiaries in Abu Dhabi and Egypt. So the idea that Air Arabia could launch a carrier in another nation is not new. Recently, Air Arabia and Etihad Airways partnered to launch an Abu Dhabi-based airline.
The company is currently working to acquire an Air Operators Certificate (AOC). More details about the launch date and fleet as well as network will be made available in due course.
Armenia's new airline will include Air Arabia
Armenia's new airline, Fly Arna
Air Arabia will be active in the new airline but it won't use the Air Arabia name (even if that is the naming model Air Arabia used up to now for joint ventures).
The name of the airline was decided by Armenians through a competition. Armenians were able to submit their ideas for new names for the airline, and the competition is over. 800 people suggested 500 names.
Fly Arna has been chosen as the new airline's name. Arna is a combination of Armenian National Airlines' first two letters and the first letter in the alphabet Airlines.
This name is described as being inclusive and reflecting the spirit behind the joint venture company that aims to transform the country's aviation sector.
Yerevan Airport will host the new airline.
My view on Fly Arna
This is the best way to go if Armenia wants to start a national airline.
The country has adopted a pragmatic and realistic approach to flying, with a focus on short-haul flying. This is more practical than opening a premium, prestige-focused airline that flies to New York.
The country will tap into the expertise and track record of an airline that has launched low-cost carriers in new countries.
It doesn't matter if a carrier makes a direct profit; there is a general economic benefit for a country with readily available air services
Despite this, the airline faces major challenges. This is evident by the fact that Armenian airlines have been forced to close their doors over the years. These are just a few of the many things that could happen:
Armenia is a developing market but the country only has three million inhabitants
If an airline wants to fly west, the competition in Europe can be fierce. We could see EasyJet and Ryanair start service in Yerevan or expand there.
Wizz Air is a popular airline that serves many destinations east of Yerevan. This latest news could help them grow.
As it stands now, there is already substantial service between Armenian and Russian so that market seems to be well-served. However, I imagine that the new airline will attempt to compete in that market.
It is still to be seen how long Armenia will invest in this airline. This is especially true if it is not immediately profitable. We see too many countries that launch airlines with the intention of supporting the economy. But then, the country is reluctant to finance the idea for very long.
Yerevan hopes to expand its tourism industry
Bottom line
Armenia has teamed up with Air Arabia in order to launch a national airline. The airline will now be called Fly Arna.
Armenia will launch an airline if this is the best way to do it. The government can use Air Arabia's experience in launching a successful airline rather than focusing on politics (though I am sure that they will find a way in).
It remains to be seen if there is enough demand for this product to succeed.
What do you think Armenia's new national airline concept is?
