Tuesday, 1 January 2013

GACA slams on the brakes

Full article in JPG format:
page 46/47 & page 48

The recent decision by GACA, Saudi Arabia's civil aviation authority, to delay awarding new domestic air licences came as little surprise to people familiar with the kingdom's heavily regulated, duopolistic market. The much-vaunted liberalisation process had advanced as far seven bidders being shortlisted - among them consortia comprising Gulf Air, Bahrain Air and Qatar Airways - but it became clear that the familiar stumbling block of regulatory price intervention was hindering a deal.

"GACA needs more time to choose the best operating models after it completes the analysis and evaluation of the bids that were received from the companies," the authority said in late November, making no reference to the widely reported withdrawal of several bids in protest at the country's domestic fare cap. Earlier that month, GACA had insisted it was in the final stages of issuing the licences...