Etihad, Air Arabia to establish Abu Dhabi-based low-cost carrier

Etihad Airbus A321
Photo: © Pete Webber

Etihad Airways and Air Arabia have announced a plan to establish a new low-cost carrier through a joint venture. The airline will be called ‘Air Arabia Abu Dhabi’ with its hub being Abu Dhabi International Airport.

This exciting partnership supports our transformation programme and will offer our guests a new option for low-cost travel to and from Abu Dhabi, supplementing our own services. We look forward to the launch of the new airline in due courseTony Douglas, Etihad Aviation Group

Air Arabia Abu Dhabi will be the 5th commercial airline based in the UAE, but the first budget airline with its hub in Abu Dhabi. The goal is to complement Etihad’s existing services from Abu Dhabi and expand the low-cost travel market in the region. Further information about the new low-cost carrier, including future fleet or planned routes, are yet to be published.

In the past, Etihad suffered major financial setbacks after investments in other airlines. For example, in 2011, Etihad purchased a 29.21% stake in the now no longer existing Air Berlin, and in 2014 it acquired 49% of Alitalia, which entered a still ongoing insolvency process two years ago. Etihad subsequently announced losses of US $1.5 billion in the same year.