Civil aviation within Bangladesh is comprised of a couple of key airlines. Biman Bangladesh Airlines, recently publicly listed, is the flag carrier, with its main hub at Shahjalal International Airport, Dhaka. Shahjalal is also a hub for GMG Airlines and United Airways.
The Civil Aviation Authority Bangladesh (CAAB) functions as the regulatory body for all aviation-related activities in Bangladesh. It is also the aeronautical service provider.
Airports in Bangladesh
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Lion Air Group’s Malaysian affiliate Malindo Air plans to pursue rapid international expansion with several routes to be launched to Indonesia and India shortly after Dhaka in Bangladesh becomes its first international destination on 28-Aug-2013. Malindo could quickly become the largest international carrier in the Lion Group as Kuala Lumpur is positioned as a transit hub for international connections.
Malindo launched services at the end of Mar-2013 and currently operates 11 domestic routes. But Malindo will now turn its attention to Malaysia’s international market, where it sees more opportunities.
Malindo will also start to leverage network synergies with its Indonesia-based sister carriers. Malindo and Lion’s three Indonesian subsidiaries will offer joint itineraries on hundreds of city pairs connecting Indonesia, where the group serves about 50 destinations, with Malaysia and South Asia. Malindo is particularly keen at tapping the under-served Indonesia-India market.
A new airline entered Bangladesh’s skies in 2013 with the launch of NovoAir on 09-Jan-2013.
NovoAir will become the fourth scheduled operator in the domestic Bangladeshi market, joining Biman Bangladesh Airlines, Regent Airways and United Airways Bangladesh, with its launch occurring less than 12 months after the suspension of GMG Airlines’ operations on 30-Mar-2012.
Launching the service, NovoAir MD Mofizur Rahman noted the potential in the domestic Bangladesh market, while adding that international service may be launched after an initial domestic focus in the first year of operation.
Two of the first destinations for Boeing 747-8 launch operator Lufthansa will be Delhi and Bangalore, notable as the 747-8 will have the largest capacity in Lufthansa's fleet after its A380, which India has not yet permitted foreign airlines to operate with. Lufthansa serves Delhi with daily 747-400 and A340-600 service while Bangalore sees daily 747-400 service. With Lufthansa utilising 46 of the 50 weekly frequencies available to German carriers (Lufthansa is currently the sole operator to India) and the Germany-India bilateral unlikely to be expanded in the near future, the deployment of larger aircraft is Lufthansa's main mechanism to expand in the growing Indian market.
Europe-India services will grow in the near future with British Airways (BA) likely to expand in India following International Airlines Group (IAG), its parent company, acquiring bmi, which has bestowed IAG with 42 London Heathrow slots. The Lufthansa Group of airlines is the largest European airline group serving India while IAG is a distant second and Air France-KLM third.
Kenya Airways plans to launch its first services to North America, South America and Australia by 2017, making it one of the few carriers to serve every inhabited continent. While these three continents will give Africa's currently fifth-largest airline by seats a global presence, its future is pegged on Asia, with the carrier over the next 10 years planning to launch seven new routes into China, six in the Indian Subcontinent and three across North and Southeast Asia as well as having a growing presence in Europe and the Middle East. It is poised to become Africa's largest carrier.
Growth will be fuelled by Africa's status as a burgeoning market, as well as reliance on partners: Kenya Airways will open routes to SkyTeam member hubs in Xiamen (Xiamen Airlines), Hanoi (Vietnam Airlines), Seoul (Korean Air), Moscow (Aeroflot) and Prague (Czech Airlines). The intercontinental focus follows Kenya's strong emphasis on regional Africa, with the carrier aiming to serve every African nation by the end of 2013.
The challenges facing the Bangladeshi aviation industry have been further highlighted in the past week with GMG Airlines suspending operations on 30-Mar-2012. GMG plans to restructure its operation to respond to a number of structural challenges in the industry, including rising competition from Middle East airlines. Meanwhile, the situation at national flag carrier Biman Bangladesh Airlines remains fragile, with the heavily indebted carrier facing a further wave of industrial unrest this month.
International airlines currently hold around two thirds of international capacity to/from Bangladesh. Just under 30 airlines are active in the market, although Biman Bangladesh Airlines remains the largest carrier operating to/from the country with a 28% international capacity share. Despite it being a price-sensitive market environment (which should support low cost carriers), development on this front has been limited and the market remains dominated by full service airlines.
Kingfisher Airlines will become part of oneworld from 10-Feb-2012, becoming the first carrier from the Indian subcontinent to join any of the global airline alliances. Air India’s application to become a member of the Star Alliance was rejected at the end of Jul-2011 while Jet Airways is yet to announce its alliance plans but is said to be in discussions with both Star Alliance and SkyTeam (SkyTeam is reportedly in discussions with a number of Indian airlines, including LCCs). Kingfisher Airlines will also be the first of three airlines to join oneworld in 2012, in its largest membership expansion drive for five years, with airberlin set to follow shortly after Kingfisher and Malaysia Airlines joining later in the year.
Joining oneworld will give Kingfisher Airlines, currently facing considering financial pressures, global visibility, brand awareness and scope to improve revenue. According to reports in The Business Standard, Kingfisher is expecting at least a 5% increase in revenue through codeshare agreements with partner airlines. There will also be cost savings through common use of inventories and joint purchases. oneworld’s continued confidence in the struggling carrier is also a positive boost for the carrier, which has significantly reduced capacity and is currently seeking INR6.7 billion (USD127 million) in short-term working loans.