5 Minutes With… Samer Majali, CEO, Gulf Air

What will your company be focusing on this year?

Ultimately our goal is to improve our business functions to provide the best value for money to our customers. This year focus has been on streamlining the route network, optimising the fleet, improving sales efficiency, introducing new and innovative products and services and further rationalising all cost elements to reduce expenditure.

Above all, we continue to be the flag carrier of the Kingdom of Bahrain and support the country’s economic ambitions by being a commercially sustainable and dynamic airline that effectively serves the people and the economy of Bahrain, and represents the Kingdom on the world stage.

Are you concerned that the current volatile global economic climate will affect your strategy?

Historically airlines’ profit margins are less than one per cent. Aviation is a financially frail industry, with airlines becoming more than ever variable-cost companies, whose expenses fluctuate in line with geo-economic and political events.

Currently the entire sector is battling not only with the challenging economic climate but also fluctuating oil prices, and on a macro level the regional political situation. Such events affect an airline’s strategy. By way of example, Gulf Air’s forced suspension of flights to Iran and Iraq last year and the Eurozone crisis caused a notable drop in revenue.

Having said this, it is no doubt the aviation industry is growing and the passengers traffic is expected to reach 10 million a day by 2015. The industry is said to be supporting $3.5 trillion in global economic activity and 33 million jobs.

But to be successful, airlines need to adapt to change and constantly identify new ways to navigate the turbulent operating environment.

What are the growth areas currently for your industry?

The region is the heart of opportunity for the aviation industry. In the future the Middle East is set to become the world’s dominant travel hub. Major investment in airlines, airports and air traffic control has been  earmarked with passenger and cargo traffic growth of eight per cent annually expected until 2015. The region’s strategic location as a hub for passenger transit between Europe and the major growth market of Asia Pacific as well as the growing international, intra-Middle East and domestic tourism will further fuel this growth.

What new products will your company launch this year?

Gulf Air has been implementing an aggressive re-fleeting strategy. The airline currently operates one of the youngest fleets in the region with an average fleet age of just 4.7 years.

Will you be expanding into new territory?

Gulf Air has one of the largest networks in the region, further reinforced by the recent re-launch of our flights to Iran and Iraq. We continually analyze the  commercially viability of potential new routes with a view to reinforcing our regional leadership position.

What will be the biggest challenges for UAE businesses in your sector in 2012?

Recently the cost of fossil fuels has been reducing; whilst this is a positive news for airlines it is likely to have a wider negative impact on the region, whose main revenue stream is from oil and natural gas. Less liquidity generally reduces investment which may prove challenging for growing companies.

Will you be hiring this year?

Staffing levels are continually monitored to ensure the operational needs of the organization are met.

What’s your leadership style?

A good leader has the ability to energize and motivate employees. In my experience this is best achieved through a consultative leadership style. However this does not suit all personalities.

What makes the perfect employee?

A person driven by passion for their job and constantly striving to make a difference.

Define success in five words…

Success is hard work.

Three tips for becoming the boss…

1.     People management
2.     Focus
3.     Drive

When I’m not at work I like to…

Enjoy other people’s company.