RJ’s Dreamliner to the Rescue?

Royal Jordanian’s first Boeing 787 Dreamliner took off on its inaugural flight from QAIA to London Heathrow Airport on September 1, with the loss-making airline no doubt hoping the addition of the next-generation airplane to its fleet will boost its prospects of weathering some particularly tough operating conditions.

Shareholder grumblings over RJ’s economic performance have been growing louder of late. Al Ghad reported that calls were made at the airline’s AGM last month for a cost cutting review of RJ’s route network and remuneration packages. The airline’s management in turn promised to let shareholders vote on a plan to raise the airline’s capital by the end of the year.

The Dreamliner that came into service last month is one of five due to be delivered to RJ by the end of the year as part of a modernization plan to replace the national carrier’s long-range fleet of aging Airbus A340s and A330s.

The Dreamliner uses around 20 percent less fuel than similarly sized airplanes already in service – a crucial selling point for an airline like RJ, whose losses of around JD75 million as of the end of 2013 are as much about the cost of jet fuel as they are about continuing regional instability.

“As with all airlines that have ordered the aircraft, RJ will be looking to the much greater fuel efficiency of the aircraft to reduce their costs,” explained aviation consultant John Strickland, adding that the Dreamliner’s smaller passenger capacity also opens up some potentially lucrative new destinations for RJ which weren’t viable before.

Hussein Dabbas, former RJ chief and now IATA’s vice president for Africa and the Middle East, agreed the inclusion of the Dreamliner to the airline’s fleet was a wise and necessary move. But he cautioned it wouldn’t be a panacea for the airline’s malaise, which has seen it suspend eight routes since the start of the year for security and cost-cutting reasons. “It’s a very important aircraft. It’s a move to the next century of civil aviation,” he said. “It definitely will help economically on certain routes, but RJ is suffering primarily from the fact that Jordan is situated in an area which is surrounded by political upheavals.”

Several other Middle Eastern airlines, including Qatar Airways and Abu Dhabi’s Etihad Airways, have placed multimillion-dollar orders with Boeing for its new Dreamliner. Boeing is locked in heated competition for customers with rival Airbus, whose huge flagship A380 is widely seen as a bet by the European manufacturer that future air travel will take place more between mega-hubs like Dubai, rather than on point-to-point routes more suited to the Dreamliner.