RIYADH: Lebanon’s flag carrier Middle East Airlines — wholly owned by the central bank, Banque du Liban — plans to launch a low-cost subsidiary to serve destinations in the EU and the Middle East in what would be a welcome addition to the sector.
Amid an economy in freefall, soaring ticket prices, and competition from Hungarian budget carrier Wizz Air Abu Dhabi’s limited but cheaper flights, analysts told Arab News how the proposal could still have a positive impact on the country’s aviation sector.
Jassem Ajaka, an economist and university professor, believes the MEA has “kind of a monopoly in terms of direct flights.”
However, negotiations with the International Monetary Fund include liberalizing various sectors, which could see increased competition for the company if new competitors enter the market.
Ajaka sees the low-cost subsidiary as a strategic play, adding: “Launching an LCC (low-cost carrier) during this monopoly scene is a step to keep its position, especially as many customers suffer from high ticket prices and look for indirect flights through cheaper airlines. This could help MEA recollect those travelers.”
