The 'Flydubai incident' tests resilience of the regional aviation sector

The region's aviation sector is facing an immensely challenging period as rising security risks intersect with higher fuel prices and fluctuating demand at a time when airlines are trying to recover from disruption caused by the US-Israeli war on Iran. Now, the "Flydubai incident" has added a new layer of concern.

A Flydubai aircraft made an emergency landing in Tabuk, Saudi Arabia, on Wednesday, two days ago. The circumstances and motives behind the incident remain unclear, but it has once again highlighted security concerns linked to aviation in the region.

The number of flights operated by airlines in the region, particularly Gulf carriers, fell to near-zero after the war began on 28 February. Airlines gradually resumed operations, and flights are now close to their pre-war levels.

James Halstead, managing partner at Aviation Strategy, told Reuters that it was difficult to assess the implications of the Flydubai incident while many questions remained unanswered.

He said its likely impact would vary depending on whether it was linked to terrorism or mental health problems, as happened in the 2015 Germanwings crash.

"If the incident is similar to what happened with Germanwings, its impact on Flydubai as an airline is likely to be greater than its impact on travel in the region," Halstead said. "If it is terrorism-related, the picture is different, and its impact is likely to be largely limited to transport to Israel." 

Following the incident, Flydubai, which is owned by the Dubai government, suspended its flights to Israel until the ongoing investigations are completed.

Data from FlightRadar24 shows that the number of Flydubai flights has already lagged behind those of other Gulf airlines in returning to pre-war levels.

Reuters quoted aviation analyst John Strickland as saying that Flydubai is considered "one of the main economic and tourism tools in Dubai's portfolio".

He added that the region had demonstrated resilience in the face of new complexities and threats since the war with Iran began.

"We have seen very strong and largely thriving demand in the region," he said, noting that he expected Flydubai to overcome the impact of the incident given its position as a key link between Dubai and regional markets.

"It would surprise me if it had any significant impact," he remarked.

Analysts also expected Flydubai to benefit from its position as a major regional carrier.

In relation to Israel, data from Israel's Ben Gurion International Airport shows that Flydubai is among the 10 largest airlines operating there by passenger numbers.

It is also the main Gulf carrier on the route, according to Reuters.

Flydubai was established in 2008 as a low-cost carrier owned by the emirate's government, complementing Emirates' role by serving regional markets and short- and medium-haul destinations.

However, the US-Israeli war on Iran, which began on 28 February, caused heavy losses for the sector after Gulf flights fell to near-zero levels in its early stages before gradually recovering.

This coincided with a sharp rise in jet fuel prices, one of the highest operating costs for airlines, putting pressure on their profit margins.

Meanwhile, the failure of efforts to reach a peace agreement led to another decline in flight volumes in recent weeks.