In October 2019 Etihad announced it would set up its own low-cost carrier in partnership with Sharjah based Air Arabia. To that date the airline was the fifth in the UAE, and the first low-cost carrier in Abu Dhabi. The announcement was given during a period in which when Etihad posted a third consecutive year of losses and after pursuing a strategy of investing in failing airlines and after the government owned Etihad began a five year transformation plan in 2017.
Initially Air Arabia Abu Dhabi was supposed to launch operations in March 2020, with plans to fly to about a dozen destinations in Saudi Arabia, Kazakhstan, Georgia, Armenia, India, Pakistan and Bangladesh.
In April 2020 Air Arabia Abu Dhabi received its air operator certificate from UAE's General Civil Aviation Authority. To that date the airline was yet to commit to a firm launch date due to the travel restrictions during the pandemic.
On July 14, 2020 the airline was launched after the signing of an agreement between Etihad Airways and Air Arabia.[4] The airline started with two based A320-200.[5]
In June 2021 the outbound load factors reached more than 70% while inbound load factors were “much lighter”.[6]
In September 2021 Air Arabia Abu Dhabi expected its annual traffic to grow by 20% to 25% over the upcoming five years.
In October 2022 Air Arabia Abu Dhabi was the second largest carrier in Abu Dhabi with an 8 percent share of seats serving 24 destinations.[7]
Corporate affairs
Air Arabia Abu Dhabi supports the network of destinations and services provided by Etihad Airways, and in turn will meet the needs of the low-cost and growing travel sector in the region. Its board of directors, which is made up of members nominated by the two companies, is responsible for directing the company's independent strategy and developing its business.[8] Air Arabia Abu Dhabi is Etihad Airways’ first major investment, a change from its long-held relationship strategy of airline equity partnerships.[9] Air Arabia Abu Dhabi is expected to take over a number of former and present Etihad routes operated by single-aisle aircraft in the near future.[10]
The airline offers a similar service model to the rest of Air Arabia’s network.[4]
Competition
The ultra-low cost carrier Wizz Air Abu Dhabi has also a base in the Zayed International Airport. Regarding the short distance between Abu Dhabi and Dubai, the hybrid airline Flydubai is a competitor.
Fleet
As of May 2024[update], Air Arabia Abu Dhabi operates the following aircraft:[11][12]
The inaugural flight was to Alexandria on 14 July 2020. The second route started one day later to Sohag.[27]
Reported in July 2022, the airline’s CEO Adel Abdulla Ali said “We will put a circle around Abu Dhabi and wherever we find potential within four to six hours, we'd like to do those routes, including Europe”.[10]
