A recent report suggested Qatar Airways continues to face struggles hampering their ambitious growth plans.
The report, published by Airline Geek, said that this is Quite possibly one of the hardest-hit companies was Qatar Airways.
Last month, Qatar Airways reported on Tuesday a 252 million riyals ($69 million) loss for the financial year ending March 31, citing a regional political dispute that has seen it banned from four Arab countries.
“As a result of those canceled routes, though, the airline had numerous aircraft sitting on the ground with nowhere to fly,” the report said. “So they began leasing them out to carriers like British Airways, in that case to temporarily fill in for the carrier’s Boeing 787.”
Saudi Arabia, the United Arab Emirates (UAE), Egypt, and Bahrain have banned Qatar Airways since June 2017 as part of a dispute they have with the government of Qatar.
The Anti-Terrorism Quartet (ATQ), consisting of the four countries, decided to cut diplomatic ties with Qatar for supporting and financing terrorism as well as having close ties with regional foe Iran.
“This turbulent year has inevitably had an impact on our financial results,” Qatar Airways Chief Executive Akbar al-Baker said in a statement.
The report also added that Qatar Airways Group CEO Akbar Al Baker said in a conference in Doha that things are looking up in the growth department as the airline has launched two dozen new routes since June 2017. However, the carrier has slowly become a victim of its own success, as Al Baker also expressed dismay at the fact that the airline is slowly running out of aircraft to meet its route and passenger demands.
The airline, which restated its year-earlier profit to 2.8 billion riyals, said it carried 29.2 million passengers in the year to March 31, down from 32 million a year earlier.
The airline said it had mitigated the impact of the dispute by launching flights to new destinations, increasing flights on existing routes, and leasing aircraft to other airlines.
“New destinations come with launch costs and the necessity to establish market presence, which resulted in an overall net loss,” the airline said.
Much of that shortage still stems from the 2017 boycott, as those countries no longer allow access to their airspace for Qatari aircraft, according to the report. “As a result, the airline has been forced to operate more roundabout routes to various destinations, in many cases requiring an aircraft swap, which has compounded their troubles.”
Qatar Airways had warned in recent months that it would report a loss and since said it could make a loss again this year and potentially need to tap its owner, the government of Qatar, for a capital injection.
Moreover, the report said Qatar’s aircraft shortage is almost the polar opposite of the troubles local competitor Emirates has been experiencing in recent months. Emirates is currently weathering an extreme pilot shortage, which has led to the airline parking dozens of Boeing 777-300ER and Airbus A380 aircraft at Dubai World City Airport until they can find the necessary staff to operate them.