SriLankan Airlines mulls joint venture with foreign airline
ECONOMYNEXT – SriLankan Airlines aims to enter into a joint venture with a foreign airline, possibly Middle Eastern, on a revenue sharing basis in order to survive in the highly competitive market, its chief executive said.
The three top Middle Eastern airlines – Emirates, Qatar and Etihad, had expanded fast and aggressively and were offering SriLankan Airlines stiff competition, said Suren Ratwatte, chief executive of the national carrier and the budget carrier Mihin Lanka.
“We want to talk about a joint venture on a revenue sharing basis.” he told the annual conference of the Chartered Institute of Logistics and Transport Sri Lanka.
A joint venture with revenue shared was necessary in order to give the partner airline the right incentive, he said.
Such an arrangement would also help lower unit costs, he added.
Ratwatte said the three Middle Eastern airlines were potential partners under consideration.
The fierce competition among the top three Middle Easter airlines might help SriLankan Airlines play them against each other and try to get the best deal.
“All three of them were suffering owing to reduced profits and looked ready to “do a deal,” Ratwatte said.
Emirates has added so much capacity that it’s now the biggest airline in terms of available seat kilometers,” he said. “Qatar is now in 10th place and Etihad 13th.” (Colombo/December 01 2015)