GF future hinges on new plan

Gulf Air's strategy to bring radical changes in all of its vital sectors to ensure its financial growth may result in a resounding success or in removing it from the airline industry and replacing it by a Bahraini airline company.
The new strategy, to be implemented by the Canadian aviation consultants Simat Helliesen and Eichner Inc.

(SH&E), includes a comprehensive change of job structure, the implementation of a new network plan, the restructuring of its fleet and a re-assessment of its employees in all sectors, a report in the London-based daily Al Hayat said yesterday.

Gulf Air's deficit currently stands at around $100 million which the four owner countries said they would pay only if the first stage of the strategy drawn by SH&E was successful.

The airline had made efforts last year to improve its performance and cut expenses, paying $159 million to cover its deficit. However, the amount was exhausted mainly by the airline's operational costs.

In the case of the strategy's success, the owner countries will accept paying their dues. However, if the strategy fails, then a new airline project will be revived. The Delmon Air project, which is currently frozen, comprises the setting up of a Bahraini airline with Cathay Pacific owning 25 per cent of the stake, the newspaper said.

The strategy, to be announced at a Press conference on Tuesday or Wednesday, will include amending the position of Chief Executive and President to just Chief Executive and eliminating the positions of assistant managers.

According to the report, the airline is conducting interviews for the post of Chief Executive Ð and is looking particularly for either an Englishman or a US citizen.

A Danish Deputy Chairman for Financial Affairs and an American Head for the Planning and Network Scheduling Department which had been separated, based on the new strategy, from the Finance Department, have been already appointed.

The strategy includes closing down unprofitable destinations and increasing the flexibility of the company fleet to deal with its profitable destinations. This will result in the airline doing away with wide-body aircrafts and using medium aircrafts and 100-seater aircrafts.

The report said that the airline might downgrade the number of its employees (5,200), but will upgrade the number of air-hosts. Members of the airline's executive committee will arrive in Bahrain on Monday to discuss a number of urgent matters and sign the contract with SH&E for the new strategy, Al Hayat said.