Oman Air Reduces Fleet by 29% in Cost-Cutting Move
Oman Air has significantly decreased its fleet size as a part of its strategy to lower operational costs and improve profitability.
Oman Air, the national carrier of Oman, has cut its fleet size by 29%, bringing its total number of aircraft down to 32 as part of a strategic effort to reduce losses.
The airline experienced a 13% decline in passenger numbers, totaling 5.4 million in the previous year. Despite this, Oman Air saw its earnings before interest, taxes, depreciation, and amortization (EBITDA) improve by 40%, reaching OR24 million (approximately $62.2 million), with operating profit also increasing by 40% to OR76 million.
Cost-Cutting Measures
To enhance operational efficiency, Oman Air expanded services to more profitable destinations and improved its load factor, which rose to 75%. The average fare remained stable at OR65. The restructuring of its workforce led to a 24% reduction, yielding savings of OR18 million. Moreover, the airline prioritized employing Omani nationals, achieving an 81% Omanisation rate.
Future Directions
Recently, Oman Air announced restructuring plans aimed at curtailing ongoing losses and preventing further debt accumulation. In January 2024, the airline will cancel flights to select cities in South Asia to strengthen its competitive positioning in the market.
