Kuwait Airways reverses strategy as it suspends privatisation plan

Premium Analysis

It is a hard ask to sell a product that is losing money, but that is what the Kuwait Government has been attempting to do with the privatisation of Kuwait Airways Corporation (KAC). Despite the carrier’s inherent potential – a potential amplified by its position as the national carrier of one of the Gulf regions’ riches oil states – the airline was always going to be a tough sell to investors.

Legislation for the privatisation has been in play since Jul-2008, but privatisation appeared to be largely stuck in red tape. In concert with this, the delays to the valuation and financial analysis of the airline, the state of competition in Kuwait’s local air market and the general global economic situation and the ongoing operational and structural problems at the carrier, all conspired against the process.

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